Every year in August I organize four lunches for serious investors on successive Fridays in eastern Long Island. There are different groups of 25—30 people at each one and many of the great names of the hedge fund, real estate and private equity world attend, along with some academics and government folk.

We have the biggest data calendar of the year, climaxing with the employment report. It is right before the Labor Day weekend. It is a natural setup for politicians and pundits alike.

This week the Federal Reserve Bank of Kansas City is hosting its annual Economic Policy Symposium in Jackson Hole, Wyoming and a number of Fed officials have commented on “inflation.” Why is targeting inflation so important? Because rising inflationary pressures will cause the Federal Reserve to raise interest rates and such periods tend to prove challenging for the stock and bond markets.

I hope investors have taken steps to prepare for some potentially disruptive economic storms, including this weekend’s central bank symposium in Jackson Hole, Wyoming, and the possibility of a contentious battle in Congress next month over the budget and debt ceiling.

We see three factors that potentially support Japanese equities going forward: 1. Improving earnings outlook amid a strengthening domestic economy and synchronized global expansion. 2. Currently attractive equity valuations compared to developed market peers. 3. Continued monetary stimulus from the Bank of Japan and a potentially stable yen.

The development of a personal trading or investing philosophy is usually an evolutionary and highly personal process. Through a combination of experience, trial-and-error, and the attainment of knowledge, successful market participants hone their skills until they find a strategy that works for them and that is consistent with their general mindset.

This will be the first in a series of articles where I will cover popular and/or high profile stocks. The primary objective of this series will be to put a spotlight on the importance of forecasting future growth prior to making an investment decision.

The changing demographics of the municipal bond market in recent years, coupled with their reliable tax-free-income stream, has made munis a compelling core allocation for today’s fixed-income investors.

Once again, the expected quiet summer week was instead filled with action. With analysts of all stripes analyzing every aspect of the changes in the Trump Administration, the financial punditry will do the same.

REITs are vulnerable to an increase in interest rates or an economic contraction. If you have been thinking of increasing your allocation to REITs to generate more cash flow, this new research – and current valuations – should serve as a cautionary warning.

The development of a personal trading or investing philosophy is usually an evolutionary and highly personal process. Through a combination of experience, trial-and-error, and the attainment of knowledge, successful market participants hone their skills until they find a strategy that works for them and that is consistent with their general mindset.

The latest bout of volatility illustrates why investors should stay focused on the longer-term. Risks for a more substantial pullback in the near-term still exist, as valuations remain elevated; but we believe solid U.S. and global economic growth, strong earnings, low inflation and still-ample global liquidity should allow the bull market to continue.

A review of last month’s market-moving events across countries and asset classes

We’ve heard Warren Buffett continue to repeat an important phrase, “what the wise man does in the beginning, the fool does in the end.” This begs the question, when does a foregone conclusion become what we call “a well-known fact”?

Last week, President Trump promised to unleash "fire and fury" on North Korea, which prompted its leader Kim Jong Un to see that bid and raise it to a direct threat against the U.S. territory of Guam. Collectively at Schwab (Schwab Center for Financial Research as well as our experts in Washington, DC) we believe the likelihood of military action remains low.

In a normal, quiet summer week we would be lazily considering consumer confidence and the Fed minutes. Instead, the escalating war of words between the U.S. and North Korea has claimed the agenda.

Supply and demand theories suggest worker scarcity would increase the price paid for labor. This has certainly been the case during recent American expansions, when annual wage gains topped 4%.

With President Trump taking vacation at the same time as Congress and a light data calendar, what will the pundits feast upon? Corporate earnings results and new stock market records mean that the price targets at the start of the year are now obsolete.

U.S. equity indexes continue to post record highs and the proverbial "wall of worry" appears to be losing bricks. The high expectations for earnings season have largely been bested, the U.S. economy continues to trend in a "Goldilocks" zone—not too hot, nor too cold...

Howard Marks’ “Memos” are a must-read. Years ago, I was invested in Marks’ hedge fund. We exited our fund of funds business in 2007, though it would have served me well to have stayed in his fund. Like most great investment managers, he keeps risk front of mind.

In July, the Institute for Supply Management’s (ISM) Non-Manufacturing Index fell to an 11-month low of 53.9, 3.5 points below its June reading of 57.4. The index measures the non-manufacturing, services industries such as food services, education, real estate, health care and more.

The muni backdrop looks benign, but be mindful of potential credit risks.

Our Summer Outlook comes a bit late this year as we were traveling in the weeks after July 4th. Our itinerary included the San Francisco area, the Washington DC area, Castle Rock and Colorado Springs. 

Venezuela is sliding closer and closer toward the brink, and things look as if they’ll get worse, unfortunately, before they improve.

As our regular readers are aware, we’ve been pounding the table all year arguing that foreign stocks are in a position to structurally outperform domestic stocks. At the risk of sounding like a broken record, we thought we would – in one post – review the setup that makes foreign equities relatively attractive at this juncture.

“Dual mandate” is one of the most commonly used phrases in U.S. central banking. The current Chair of the Federal Reserve often mentions it in both speeches and testimony to Congress. Not surprisingly, this is an extremely hot topic in monetary economics, and execution of this mandate has profound significance.

I’m in the process of writing another book, going into great depth regarding one of the most important things discussed in my book The Most Important Thing: cycles, their causes, and what to do about them. It will be out next year, but this memo will give you a preview regarding one of the most important cyclical phenomena.

I continue to believe that the two most important issues receiving inadequate investor attention are productivity and the role of central bank liquidity in the performance of financial markets. Productivity is critical to both earnings improvement and a rising standard of living.

There was something of a change in tone last week. There is more recognition of improving conditions. With a tailwind from improving earnings.

A growing number of Federal Open Market Committee officials have voiced concerns over decelerating inflation since the June FOMC meeting, and the latest inflation print likely did little to alleviate them.

Ray Dalio, chairman of Bridgewater Associates, wrote last week that the global economy is heading toward a new stage where markets won’t get the same level of support from the global monetary policy makers. “The directions of policy are reversing,” he noted.

Markets seem not to care what the media or polls have to say. The Dow Jones Industrial Average continues to hit new all-time highs. Even though it’s stalled a few times, the “Trump rally” appears to be in full-speed-ahead mode, more than eight months after the election.

With Market Indices at or Close to All-Time Highs, Investors Puzzle Over the Course Ahead. Meanwhile, The Slow-Growth Economy Is Perceived as the New "Goldilocks Scenario."

A review of last month’s market-moving events across countries and asset classes.

The Fed’s “balance sheet reduction” may have profound implications for the dollar, gold, stocks and bonds. We’ll provide an outlook.

It never fails that when you decide to slip out of the office for a break, the markets will act up. Last week was not an exception to the rule as investor anxiousness continued to cause activity on trading desks. Rising global yields continued to stress risk parity funds and leveraged hedge funds who were positioned for lower interest rates.

To a large extent, the U.S. financial crisis was actually made by the Fed… It was ultra-low rates that fueled the search for higher yield that enabled creatively engineered mortgage products (CDOs, CDOs of CDOs, adjustable rate and no-doc mortgages and AAA-rated garbage).

During the 35 year secular bull market that began in October 1981, there were a number of sharp increases in yields in which bond prices fell. But investors who held on were bailed out by the secular bull market and eventually recovered all the losses and with gains to show for their patience.

Of the 14 commodities we track closely at U.S. Global Investors, wheat rose to take the top spot for the first half of 2017, returning more than 25 percent. The grain was followed closely by palladium—used primarily in the production of catalytic converters—which gained 24 percent.

It is a Seinfeld market. The story is about nothing, but must be described along the way. With nothing better to discuss, people will be asking what should we expect for the rest of 2017.

Recent economic data reports have helped to fill in the picture of the economy in the first half of the year. However, investors should be more concerned with the prospects for the second half of the year.

I listened to Bob Farrell several times a week. Bob was the chief stock market analyst at Merrill Lynch. Do you remember those old “squawk boxes?” On my desk sat a small speaker box. It was the firm’s way of communicating to the thousands of brokers.

A holiday-interrupted week is loaded with important economic data. Since many market participants will skip Monday to stretch their weekend, the action will focus on Friday’s employment situation report.

We are at the far edge of a monumental mesa here, but speculators are ignoring the cliff, assuming that they are on a permanently high plateau. The unfortunate aspect of these mesas and valleys is that they encourage backward-looking investors to believe that projected returns based on “old valuation measures” are no longer relevant, precisely when valuations are most informative about future returns.

I think that now is a good time to take another look at royalty companies. Here are the top six things I believe investors should know about this specialized sector.