The essential survival tactic for a hypervalued market, and its resolution ahead, is to recognize that market valuations can experience breathtaking departures from historical norms for extended segments of the market cycle, so long as shorter-term conditions contribute to speculative psychology rather than risk-averse psychology. Yet those departures matter enormously for long-term returns.

In addition to popping champagne corks and black-eyed peas (at least in the South) on New Year’s Day, year-end brings something else for economists and portfolio managers: annual forecasts. People want to know what the coming year will bring. I would like to know, too. But since I’m on the other side of your monitor, I must give you my own forecast. Caveat emptor applies.

The number-one skill elite gamblers and investors cite is the ability to calculate the odds of winning or losing on any hand, bet, trade or strategy. Those who do the calculation have a distinct advantage over those who don’t.

With the year quickly coming to a close, it might be time to start thinking about rebalancing the gold holdings in your portfolio. That includes bullion, jewelry, gold stocks and well-managed gold funds—all of which I recommend giving a collective 10 percent weighting. Because it’s been such a strong year for stocks—they’ve advanced more than 20 percent as of today—it’s likely that most investors will need to add to their gold exposure to meet that 10 percent weighting as we head into 2018.

Few things in this world can be predicted with accuracy over multiyear periods and fewer still over multidecade spans. One exception is population demographics. Based on data today, we have a good idea how populations will develop through 2050.

Jeremy Grantham co-founded GMO in 1977 and serves as the firm’s chief investment strategist. Lucas White is the lead portfolio manager for the GMO Climate Change Strategy. In this interview, Jeremy and Lucas discus the risks and opportunities in climate-change-focused investing.

In its November report, mortgage security firm Freddie Mac called 2017 the “best year in a decade” for the housing market by a variety of measures. These include low inflation, strong job growth and historically-low mortgage rates. This assessment is very encouraging, not just for homebuyers and builders and the U.S. economy in general, but also for commodities, resources and raw materials as we head into 2018.

The U.S. Congress passed a significant bill today that makes sweeping changes to the country’s tax code. How much of a boost could the new law provide to financial markets and the nation’s economy?

Mexican asset prices reflect current and potential economic and political risks. But a likely turn in the country’s economic cycle makes for a potentially attractive entry point for longer-term investors, and the financial sector may soon benefit.

There’s so much to talk about in this week before Christmas it’s hard to know where to start. The economy continues to gain momentum. Last week, the Atlanta Fed revised its GDPNow forecast from 2.9% to 3.2% for the 4Q.

A report issued by the CFPB in August 2017 claimed that using a reverse mortgage to delay Social Security is a bad idea. This report gained a lot of press coverage and is likely serving as the primary resource for people seeking to learn more about the matter. I will provide the analysis that shows why the CFPB is wrong.

Delusions are often viewed as reflecting some deficiency in reasoning ability. The risk of thinking about delusions in this way is that it encourages the belief that logical, intelligent people are incapable of delusion. An examination of the history of financial markets suggests a different view.

US stocks will likely rise in 2018. By how much is anybody's guess: the standard deviation of annual returns is too wide to get even close to a correct estimate on a consistent basis. Earnings growth implies 6% price appreciation, but tax cuts could boost that to 13%.

I help advisors convert prospects into clients, often restructuring the way they communicate. Here are three costly but common errors. To keep the clients you worked so hard to convert you can’t afford to make these errors.

Times have changed, in more ways than one. This December has been especially hectic, with the transition in Brexit negotiations, U.S. tax reform debate and Bitcoin setting new highs every few minutes.

The U.S. Federal Reserve (the Fed) delivered another rate hike today, raising its target policy rate by 25 basis points to a new range of 1.25-1.50%. The decision was widely anticipated by economists and fixed income investors.

We prefer to take economic risk in equities over credit given tight spreads, low yields and a maturing cycle. We expect increasing profitability to power equity returns, especially in Japan and emerging markets (EM).

Long-term interest rates remain stuck in a range that has defined the last six years. Russ discusses why 2018 may see more of the same.

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

Even as the Fed is expected to hike rates in December as part of its policy normalization, a majority of ECB governing members continue supporting the bank’s asset-purchase programme. Shifting central bank dynamics will make the landscape increasingly difficult for investors to navigate says Franck Dixmier, Global Head of Fixed Income for Allianz Global Investors.

While many people believe that technological progress and job destruction are accelerating dramatically, there is no evidence of either trend. In reality, total factor productivity, the best summary measure of the pace of technical change, has been stagnating since 2005 in the US and across the advanced-country world.

This article is in response to Kerry Pechter’s article, The Ambiguity of Tax Deferral. In contrast to the idea that there are different, but valid, ways to look at traditional tax-deferred 401(k) and IRA accounts, I show that there are right and wrong conceptual models. Wrong models lead to wrong decisions and do not explain outcomes.

Economic growth continues, and although this cycle has been the slowest recovery in post-war history, the slower growth has allowed for a prolonged cycle. Inflation remains low—since peaking in 1980, the U.S. has experienced consistent disinflation.

Wondering how style factors work and how to use them? The five Ws tell the story of the value, momentum, quality, size and minimum volatility factors.

Two weeks ago, we introduced this report and covered the mass arrests that took place in Saudi Arabia over the weekend of November 4, when several princes and notable figures were detained. The official reason given for the arrests was corruption, but many have speculated that the move was a cover for Mohammad bin Salman (MbS) to consolidate power and purge elements of a potential coup.

Will the global growth momentum of 2017 carry over into next year? Is there a risk of a pullback in the short term? See what our strategists' views on global investment markets and economies are for the year ahead.

The gradual reversal of expansionary monetary policies – at differing paces globally – will require some investors to adjust their approaches. Protecting purchasing power will remain a priority as official inflation understates real-world costs.

On Friday, the Commodity Futures Trading Commission (CFTC) approved bitcoin futures trading on the Chicago Mercantile Exchange (CME) and the CBOE Futures Exchange (CFE). Bitcoin has risen by a factor of ten since the start of the year.

This is a part of our the weekly poll series we will launch on our site. It takes one minute and once you submit your response you'll be taken to a page where you can see the results. Continue the conversation on the results page about why you chose your answer by clicking on "COMMENT ON" APViewpoint link.

“Most people get interested in stocks when everyone else is,” Warren Buffett famously said. “The time to get interested is when no one else is.” The same logic applies to Christmas decorations, gold and mining stocks.

US tax reform looks to impact many areas of our lives, and one of these could be the way Americans save and invest for retirement. As we wait for Congress to refine and vote on the latest tax proposals, Drew Carrington, head of Institutional Defined Contribution at Franklin Templeton Investments, breaks down how lawmakers might target retirement dollars for tax revenue.

Are you ready to die younger than your parents? It may not be what you want, but for society it is not at all that bad. In the years to come, we will literally drown in healthcare costs, but declining longevity, which is an emerging trend, could just about to solve that problem.

The U.S. economic expansion is now the third-longest on record. Does this mean a recession is looming? Senior Investment Strategist Paul Eitelman digs into the data and assesses the risks.

In each of the first three quarters of 2017, there have been double-digit year-over-year percentage increases in the quarterly average level of the S&P 500 stock-price index – 19.3% in Q1, 15.5% in Q2 and 14.2% in Q3.

A massive amount of stock market capitalization is tied up in companies based on both their potential market share and hypothetical future profits. The popular arguments in their favor come from looking at a company’s total addressable market (TAM). Sky high price-to-earnings ratios and massive capitalizations are common in companies with a large TAM as we finish up 2017.

This is the third week of a weekly poll series we will launch on our site. It takes one minute and once you submit your response you'll be taken to a page where you can see the results. Continue the conversation on the results page about why you chose your answer by clicking on "COMMENT ON" APViewpoint link.

Even if you don’t mislead or offend clients, if you bore them, the time and effort to communicate with clients is wasted. There are six components to doing a great job of communicating online. While some advisors get two or three of them right, almost no one nails all six … and as a result, you aren’t getting the return that you could.

In 2017, corporate credit, including high yield, saw a resurgence in interest within a longer-term trend of increasing supply. In recent weeks, however, it has shown some cracks.

There could always be an exogenous event like military conflict with North Korea, strife in the Middle East that cuts off oil flow or Russian aggression in the Baltics that unsettles markets. The market is assuming none of that will happen, and if the market is right, we have at least one to two years to go before we get into serious trouble. My overall conclusion is that there are significant investment opportunities outside the United States and many portfolio managers are under-weighted globally.

In the concluding piece of our three-part series on principles of the low-return imperative, we discuss why we believe investors can no longer take on risks they don't expect to get paid for—and identify two key risks we see as unrewarded.

The book is closing on third quarter earnings, which were stellar; but is it time to worry about a bar set too high in 2018?

The financial impact of 2017’s three devastating hurricanes has varied greatly depending on the region affected. From a credit standpoint, the most important takeaway is that each region’s ability to withstand the financial impact of the storms depends on its credit quality ahead of the storm.

I want to outline a process I created many years ago that I teach to managers, leaders of firms and staff members so they can learn to solve their own problems.

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

With the Republican tax bill looming, we've updated this article to include the latest figures and estimates for federal debt and taxes.