Nominal retail sales in August were up 0.05% month-over-month (MoM) and up 2.13% year-over-year (YoY). However, after adjusting for inflation, real retail sales were down 0.14% MoM and down 0.45% YoY.
The Census Bureau's Advance Retail Sales Report for August revealed headline sales were up 0.1% last month. The latest reading was higher than the expected -0.2% monthly growth in consumer spending.
The new thing in electricity is datacenters. The new new thing is … coal?
The Federal Reserve is widely expected to begin cutting interest rates at its September meeting. Market performance may depend on whether the pace of cuts is fast or slow.
The Federal Reserve (Fed), and markets, overreacted to the slightly higher inflation seen during the first quarter of the year. After that scare, the Fed went from expecting three cuts in the federal funds rate in 2024 to just one cut during its June dot plot release.
In this article, Russ Koesterich discusses why the next bout of market volatility may last a bit longer than previous downturns and how to best position your portfolio against this backdrop.
The money manager who hasn’t cracked open the Journal of Finance, Journal of Financial Economics, Journal of Portfolio Management, or Financial Analysts Journal for the past few years probably hasn’t lost any steps.
The time has come! After the most aggressive tightening cycle in modern history, the Fed is ready to turn the page and begin dialing back its policy restraint after the second longest ‘on hold’ period (14 months) in history. Barring any surprises, the Fed should lower interest rates at its meeting next week—the first rate cut in over four years—in the hopes of preserving a soft landing for the economy.
As we move into the final stretch of 2024, many investors may be asking themselves: Is it time to give airline stocks another look? According to a new report from Bank of America (BofA), the answer might very well be yes
Due to balance sheet concerns, the higher-for-longer interest rate environment has been a significant headwind for the relative performance of U.S. small-cap equities.
In this video, Chuck Carnevale, Co-Founder of FAST Graphs, a.k.a. Mr. Valuation and Professor Nathan Mauck, Phd. are going to talk about how to approach growth stock investing. As Mr. Valuation, Chuck is a proponent of growth at a reasonable price, often referred to as GARP investing, and Professor Mauck is going to provide some insights into what that actually means.
“Fracking” is an expletive in environmental circles. Yet the spirit of shale is creeping into a business with transformational potential for the energy transition. Schlumberger NV, the industrial giant best known for sucking oil and gas from shale, the seabed (and other places besides), this week announced a breakthrough in direct lithium extraction, or DLE.
How an election affects stock market performance depends more on how close and contentious it is than on whether the winner is Republican or Democrat, liberal or conservative.
While the pace of Federal Reserve cuts is in question, all roads lead to lower interest rates.
Recent Fed commentary and economic data have crystallized investor confidence in rate cuts coming in less than a week
Wholesale inflation increased more than expected last month. The producer price index for final demand increased 0.2% month-over-month (s.a.). On an annual basis, headline PPI decelerated from 2.1% in July to 1.7% in August.
Gold climbed to a record after another faster-than-forecast US inflation print and an uptick in applications for unemployment benefits substantiated bets that the Federal Reserve will cut interest rates next week.
If you entered this NFL season as a Kansas City Chiefs fan, you’re probably hoping for a Super Bowl win after clinching three of the past five Super Bowls and having Patrick Mahomes as your quarterback and Taylor Swift backing the team.
Multiple jobholders account for 5.1% of civilian employment. The survey captures data for four subcategories of the multi-job workforce, the relative sizes of which we've illustrated in a pie chart.
Let's take a close look at August's employment report numbers on Full and Part-Time Employment. The latest data shows that 82.5% of total employed workers are full-time (35+ hours) and 17.5% of total employed workers are part-time (<35 hours).
This series has been updated to include the August release of the consumer price index as the deflator and the monthly employment update. The latest hypothetical real (inflation-adjusted) annual earnings are at $51,005, down 6.7% from over 50 years ago. After adjusting for inflation, hourly earnings are below their all-time high from April 2020.
Let's do some analysis of the Consumer Price Index, the best-known measure of inflation. The Bureau of Labor Statistics (BLS) divides all expenditures into eight categories and assigns a relative size to each. The pie chart illustrates the components of the Consumer Price Index for Urban Consumers, the CPI-U.
Inflation cooled for a fifth straight month in August, dropping to its lowest level since February 2021. According to the Bureau of Labor Statistics, the headline figure for the Consumer Price Index fell to 2.5% year-over-year, right in line with economist expectations. Additionally, core CPI cooled to 3.2% as expected.
Here’s a quote attributed to P. J. O’Rourke, an American author, journalist and political satirist: “There is a simple rule here, a rule of legislation, a rule of business, a rule of life: beyond a certain point, complexity is fraud.”
When you pay attention to details in the financial services industry, you elevate your firm’s standing and demonstrate to clients that their relationships are valued. Small, considerate gestures can transform clients’ perception of your service, often bridging the gap between a satisfactory experience and an exceptional one.
Banks and shadow banks are meant to exist in separate worlds, but the financial links between them are increasingly seen as a source of potential instability. That’s a problem for banks because the business of forging those ties has lately been among the hottest activities on Wall Street.
Is now the time for a small-caps ETF? Rate cuts and other potentially positive indicators could position the space to benefit.
In emerging markets, technological advancements present a unique opportunity to empower underserved communities.
How do you convey your value and convince qualified prospects that hiring you will be a worthwhile investment without breaching your compliance obligations as an advisor?
The safest way to ensure retirement security is to match, on a year-by-year basis, future spending needs with a reliable stream of inflation-adjusted income and maturing fixed-income assets. As we’ve already seen, a conventional stock/bond portfolio may not cut that mustard.
Given the backdrop of monetary policy stimulus, the global economy is poised for growth and international stocks for continued leadership.
Investors weighing election risks ahead of the first US presidential debate between Vice President Kamala Harris and former President Donald Trump are already a lot more jittery than they were before Trump and his onetime opponent, President Joe Biden, met onstage in June.
On the back of recent cooling in economic growth, an uptick in unemployment, and moderating inflation, the Federal Reserve (Fed) looks set to begin its rate-cutting cycle at its September meeting.
An analysis of the leadership reversal and market sell-off observed in recent weeks and why an emphasis on equities with consistent fundamentals is justified.
August’s employment report, which was weaker than markets were expecting but stronger than our call, cements our view that the easing cycle will begin during the next FOMC meeting, September 17-18.
Friday’s employment report suggests the US economy may be slowing down faster than most investors think
Part one of this series described the burgeoning bull steepening yield curve environment and what it implies about economic growth and Fed policy. It also discussed the three other predominant types of yield curve shifts and what they suggest for the economy and Fed policy.
In this article, we’re going to throw some cold water on the DI love-fest by explaining why most tax-sensitive investors would be better off with a simpler approach to tax loss harvesting.
US Bitcoin exchange-traded funds have posted their longest run of daily net outflows since listing at the start of the year, part of a wider retreat from riskier assets in a challenging period for global markets.
Since the end of the “Yen Carry Trade” correction in August, bullish positioning has returned with a vengeance, yet two key risks face investors as September begins. While bullish positioning and optimism are ingredients for a rising market, there is more to this story.
We are entering a time I think will include a deep crisis. We are going to need each other. We really do need to “find our tribe.”
The U.S. economy may be heading into choppy waters, and investors might be wise to buckle up.
The main focus for investors should is no longer if the Fed will cut rates in 2024, but how much and how quickly the Fed will lower interest rates.
The concept of portable alpha is over 40 years old. And while it has evolved through various forms over that time, it continues to be a valuable portfolio tool for institutional investors. Arguably, the most popular iteration right now is adding alpha expected from hedge funds on top of synthetic beta exposure.
The yield on the 10-year note ended September 6, 2024 at 3.72%, the 2-year note ended at 3.66%, and the 30-year at 4.03%.
Most people see “blockchain” and “funds” in the same sentence and immediately think of pools of money betting on cryptocurrencies like Bitcoin and Ether. That isn’t how Singapore sees the utility of distributed ledgers.
Recent changes to the FAFSA form and process include a simpler form, fewer questions and a revised eligibility formula. Our Bill Cass highlights what you need to know to apply for federal financial aid for college.
Presidential elections tend to have limited impact on market performance, regardless of party win (although markets prefer Democratic switches). Investors should capitalize on the uptick in market volatility, which investors can use for strategic investing.
Private assets are the fastest-growing market in the financial world, but could be the most challenging field for ETF providers to penetrate.
Investors should be careful what they wish for in hoping for an aggressive Fed rate cutting cycle, given stocks tend to do better when cuts are slow and steady.
After a decade of consistent outperformance, Japanese small caps began underperforming their large cap peers in 2018, a trend that has accelerated since 2023.
This week I had the chance to run a half-day workshop helping seasoned, successful advisors learn techniques for emerging as strong leaders, so I’ll share some of the information here in this column.
Equity bulls looking for signs of relief after Tuesday’s stock rout may get a hand from a familiar friend: corporate America.
The sharp selloff that wiped a record $279 billion off Nvidia Corp.’s market value on Tuesday has traders scouring charts for clues as to where the pain might end.
A soft landing for the U.S. economy still appears to be the most likely outcome.
Here is a look at real (inflation-adjusted) charts of the S&P 500, Dow 30, and Nasdaq composite since their 2000 highs. We've updated this through the August 2024 close.
You did everything by the book. Your prospect talked and you listened. But listening alone is not enough to build trust.
Half your coworkers might have just spent August in Europe, but there were no holiday doldrums in the booming world of ETFs.
It’s the story of so many stock market manias: A transformative technology juices a few companies, a bunch of more questionable outfits follow in their wake, and Wall Street buys it all. Then time sorts out what’s real from fake.
Apple Inc.’s upcoming iPhone release has sent its stock price soaring because of promised artificial-intelligence features. Those gains appear vulnerable, at least in the short term, if history is any guide.
After a bit of an early-August swoon, the stock market came roaring back in the last few weeks of the month. The S&P 500 finished up 2.4%, though certainly in the early days of August, that did not feel like a particularly likely outcome. In client conversations a few days into the selloff, our feeling was to stay put and not tinker with the portfolios we suggested in early August.
The Institute for Supply Management (ISM) manufacturing purchasing managers index (PMI) inched up to 47.2 in August but remains in contraction territory for a fifth straight month. The index has now contracted for 21 of the past 22 months. The latest reading was worse than the forecast of 47.5.
The August S&P Global US Manufacturing PMI™ fell to 47.9 in August from 49.6 in July, indicating a modest deterioration in business conditions for a second straight month. The latest reading was just below the forecasted reading of 48.0 and is the index's lowest level of the year.
As I write this, gold continues to trade above $2,500 an ounce after surging past the psychologically important level for the first time ever in mid-August. For seasoned gold mining investors, this should be a moment of validation. After all, the yellow metal has long been seen as the ultimate hedge against economic uncertainty.
As of August 31, 2024, the 10-year note was 339 basis points above its historic closing low of 0.52% reached on August 4, 2020.
Seven of our eight indexes on our world watch list have posted gains through August 30th, 2024. The U.S.'s S&P 500 finished in the top spot with a year-to-date gain of 19.09%. Tokyo's Nikkei 225 finished in second with a year-to-date gain of 15.49% while India's BSE SENSEX finished in third with a year-to-date gain of 14.57%.
The weekly leading economic index (WLEI) is a composite for the U.S economy that draws from over 20 time-series and groups them into the following six broad categories which are then used to construct an equally weighted average. As of August 23rd, the index was at 24.827, down 1.545 from the previous week, with 4 of the 6 components in expansion territory.
Establishing the optimal workplace retirement plan follows a pecking order, which starts by prioritizing plan design over investments. Our Mike Dullaghan discusses the process.
The Federal Reserve’s preferred measure of underlying US inflation rose at a mild pace and household spending picked up in July, reinforcing policymakers’ plan to start cutting interest rates next month.
Copper has been trending lower since the middle of May, but supply disruptions in Latin America could help reverse that trend.
Valid until the market close on September 30, 2024
This article provides an update on the monthly moving averages we track for the S&P 500 and the Ivy Portfolio after the close of the last business day of the month.
The BEA's core Personal Consumption Expenditures (PCE) Price Index for July showed that core inflation continues to be above the Federal Reserve's 2% long-term target at 2.6%. The July core Consumer Price Index (CPI) release was higher, at 3.2%. The Fed is on record as using core PCE data as its primary inflation gauge.
Personal income (excluding transfer receipts) rose 0.32% in July and is up 4.1% year-over-year. However, when adjusted for inflation using the BEA's PCE Price Index, real personal income (excluding transfer receipts) was up 0.16% month-over-month and up 1.6% year-over-year.
The latest Chicago Purchasing Manager's Index (Chicago Business Barometer) edged up to 46.1 in August from 45.3 in July. The latest reading is better than the 45.0 forecast but keeps the index in contraction territory for a ninth straight month.
With the release of July's report on personal incomes and outlays, we can now take a closer look at "real" disposable personal income per capita. At two decimal places, the nominal 0.21% month-over-month change in disposable income comes to 0.06% when we adjust for inflation. The year-over-year metrics are 3.09% nominal and 0.58% real.
The BEA's Personal Income and Outlays report revealed inflation remained at its lowest level since early 2021. The PCE price index, the Fed's favored measure of inflation, was up 2.5% year-over-year, just below the forecasted 2.6% growth. On a monthly basis, PCE inflation was up 0.2% from June, as expected.
When you see that behavior at extreme valuations, it tends to be a sign of underlying skittishness and risk aversion. When valuations are setting record extremes because the news can’t get any better, even a slightly less optimistic outlook becomes a risk.
The late Jack Bogle — father of the first index fund — famously loathed their exchange-traded offspring, warning that it only incentivize speculative trading among “fruitcakes, nut cases and lunatic fringe.” Fast forward to 2024, and critics warn a new generation of ETFs are designed to do exactly that.
Many recent studies have been done on the economics of different generations. Researchers want to know if Millennials and Gen Z are in fact worse off than their Boomer and Gen X parents. There are quite a few ways to look at this data.
The path for lower rates in the U.S. has finally arrived.
While short-term fluctuations and sudden selloffs have tested the markets, key indicators such as corporate profits, employment data, and economic resilience have held firm.
The second estimate for Q2 GDP came in at 2.95%, an acceleration from 1.41% for the Q1 final estimate. With a per-capita adjustment, the headline number is lower at 2.48%, a pickup from 0.95% for the Q1 headline number.
Rules are made to be broken, so I would call this a 50 percent starting place in your discussion with the client. I certainly wouldn’t recommend only a 50 percent equity portfolio to a young client with a high willingness and need to take risk or the same to any client who had a low willingness and need to take risk.
Real gross domestic product (GDP) is comprised of four major subcomponents. In the Q2 GDP second estimate, three of the four components made positive contributions.
If your home and/or its contents are destroyed or damaged by a disaster such as a fire or flood, the insurance company will need a complete list of what was lost. Do you have such a list?
The National Association of Realtors® (NAR)unexpectedly fell 5.5% in July to 70.2, its lowest level in history. Pending home sales were expected to inch up 0.2% from the previous month. The index is down 8.5% from one year ago.
Nvidia Corp.’s earnings report needed to be perfect for a stock that’s added nearly $2 trillion in market value in the past year. In the end, a broad beat still sparked a selloff.
Nvidia Corp.’s earnings report was impressive by virtually any metric — except its own recent history.
Nvidia Corp. failed to live up to investor hopes with its latest results on Wednesday, delivering an underwhelming forecast and news of production snags with its much-awaited Blackwell chips.
An extended period of elevated interest rates may have long-term implications for both consumers and businesses—affecting how investors value company shares.
Small Cap
The Big Four Recession Indicators: Real Retail Sales Down 0.1% in August
Nominal retail sales in August were up 0.05% month-over-month (MoM) and up 2.13% year-over-year (YoY). However, after adjusting for inflation, real retail sales were down 0.14% MoM and down 0.45% YoY.
Retail Sales Up Only 0.1% in August, But Better Than Expected
The Census Bureau's Advance Retail Sales Report for August revealed headline sales were up 0.1% last month. The latest reading was higher than the expected -0.2% monthly growth in consumer spending.
AI Heralds a New Deal for Old Coal Plants
The new thing in electricity is datacenters. The new new thing is … coal?
Schwab Market Perspective: Fed Watch
The Federal Reserve is widely expected to begin cutting interest rates at its September meeting. Market performance may depend on whether the pace of cuts is fast or slow.
The Federal Reserve: Between a rock and a hard (market) place
The Federal Reserve (Fed), and markets, overreacted to the slightly higher inflation seen during the first quarter of the year. After that scare, the Fed went from expecting three cuts in the federal funds rate in 2024 to just one cut during its June dot plot release.
Why the Next Spike in Market Volatility May Last
In this article, Russ Koesterich discusses why the next bout of market volatility may last a bit longer than previous downturns and how to best position your portfolio against this backdrop.
Who Needs Academic Finance Literature?
The money manager who hasn’t cracked open the Journal of Finance, Journal of Financial Economics, Journal of Portfolio Management, or Financial Analysts Journal for the past few years probably hasn’t lost any steps.
Shifts in the Fed’s Dot Plot Should Set the Market’s Tone
The time has come! After the most aggressive tightening cycle in modern history, the Fed is ready to turn the page and begin dialing back its policy restraint after the second longest ‘on hold’ period (14 months) in history. Barring any surprises, the Fed should lower interest rates at its meeting next week—the first rate cut in over four years—in the hopes of preserving a soft landing for the economy.
It’s Time to Reconsider Airline Stocks. Here Are Four Reasons Why.
As we move into the final stretch of 2024, many investors may be asking themselves: Is it time to give airline stocks another look? According to a new report from Bank of America (BofA), the answer might very well be yes
Positioning for a Small-Cap Market Rotation in Our Model Portfolios
Due to balance sheet concerns, the higher-for-longer interest rate environment has been a significant headwind for the relative performance of U.S. small-cap equities.
Growth At A Reasonable Price – The Risks And Rewards
In this video, Chuck Carnevale, Co-Founder of FAST Graphs, a.k.a. Mr. Valuation and Professor Nathan Mauck, Phd. are going to talk about how to approach growth stock investing. As Mr. Valuation, Chuck is a proponent of growth at a reasonable price, often referred to as GARP investing, and Professor Mauck is going to provide some insights into what that actually means.
The Spirit of Fracking Comes to US Lithium Mining
“Fracking” is an expletive in environmental circles. Yet the spirit of shale is creeping into a business with transformational potential for the energy transition. Schlumberger NV, the industrial giant best known for sucking oil and gas from shale, the seabed (and other places besides), this week announced a breakthrough in direct lithium extraction, or DLE.
Elections and the Stock Market: Polarization Trumps Politics
How an election affects stock market performance depends more on how close and contentious it is than on whether the winner is Republican or Democrat, liberal or conservative.
Federal Reserve: On the Road Again
While the pace of Federal Reserve cuts is in question, all roads lead to lower interest rates.
Positioning Ahead of the Fed: ETFs for a Lower Rate Era
Recent Fed commentary and economic data have crystallized investor confidence in rate cuts coming in less than a week
Producer Price Index: Wholesale Inflation Increases in August
Wholesale inflation increased more than expected last month. The producer price index for final demand increased 0.2% month-over-month (s.a.). On an annual basis, headline PPI decelerated from 2.1% in July to 1.7% in August.
Gold Climbs to a Record as US Data Bolster Fed Rate Cut Case
Gold climbed to a record after another faster-than-forecast US inflation print and an uptick in applications for unemployment benefits substantiated bets that the Federal Reserve will cut interest rates next week.
Q2 2024 Earnings Season Review: Beating Expectations Isn’t Enough
If you entered this NFL season as a Kansas City Chiefs fan, you’re probably hoping for a Super Bowl win after clinching three of the past five Super Bowls and having Patrick Mahomes as your quarterback and Taylor Swift backing the team.
Multiple Jobholders Account for 5.1% of All Employed
Multiple jobholders account for 5.1% of civilian employment. The survey captures data for four subcategories of the multi-job workforce, the relative sizes of which we've illustrated in a pie chart.
A Closer Look at Full-time and Part-time Employment
Let's take a close look at August's employment report numbers on Full and Part-Time Employment. The latest data shows that 82.5% of total employed workers are full-time (35+ hours) and 17.5% of total employed workers are part-time (<35 hours).
Middle Class Hourly Wages as of August 2024
This series has been updated to include the August release of the consumer price index as the deflator and the monthly employment update. The latest hypothetical real (inflation-adjusted) annual earnings are at $51,005, down 6.7% from over 50 years ago. After adjusting for inflation, hourly earnings are below their all-time high from April 2020.
Inside the Consumer Price Index: August 2024
Let's do some analysis of the Consumer Price Index, the best-known measure of inflation. The Bureau of Labor Statistics (BLS) divides all expenditures into eight categories and assigns a relative size to each. The pie chart illustrates the components of the Consumer Price Index for Urban Consumers, the CPI-U.
Consumer Price Index: Inflation Cools to 2.5% in August
Inflation cooled for a fifth straight month in August, dropping to its lowest level since February 2021. According to the Bureau of Labor Statistics, the headline figure for the Consumer Price Index fell to 2.5% year-over-year, right in line with economist expectations. Additionally, core CPI cooled to 3.2% as expected.
It's Increasingly Difficult to Defend Your Complex Portfolios
Here’s a quote attributed to P. J. O’Rourke, an American author, journalist and political satirist: “There is a simple rule here, a rule of legislation, a rule of business, a rule of life: beyond a certain point, complexity is fraud.”
Small Changes Can Make Big Impacts in Enhancing Client Interactions
When you pay attention to details in the financial services industry, you elevate your firm’s standing and demonstrate to clients that their relationships are valued. Small, considerate gestures can transform clients’ perception of your service, often bridging the gap between a satisfactory experience and an exceptional one.
Wall Street’s Hottest Business Is About to Cool
Banks and shadow banks are meant to exist in separate worlds, but the financial links between them are increasingly seen as a source of potential instability. That’s a problem for banks because the business of forging those ties has lately been among the hottest activities on Wall Street.
Look to This Outperforming SMID-Cap ETF as Rate Cuts Loom
Is now the time for a small-caps ETF? Rate cuts and other potentially positive indicators could position the space to benefit.
The New Emerging Markets
In emerging markets, technological advancements present a unique opportunity to empower underserved communities.
Financially Stuck? Start Moving With the Power of the ‘Micro Yes’
How do you convey your value and convince qualified prospects that hiring you will be a worthwhile investment without breaching your compliance obligations as an advisor?
Why Should You Care When Stocks Plunge?
The safest way to ensure retirement security is to match, on a year-by-year basis, future spending needs with a reliable stream of inflation-adjusted income and maturing fixed-income assets. As we’ve already seen, a conventional stock/bond portfolio may not cut that mustard.
Rate Cuts Support a Brighter 2025
Given the backdrop of monetary policy stimulus, the global economy is poised for growth and international stocks for continued leadership.
The Stocks, Bonds and Currencies Investors Are Watching During the Trump-Harris Debate
Investors weighing election risks ahead of the first US presidential debate between Vice President Kamala Harris and former President Donald Trump are already a lot more jittery than they were before Trump and his onetime opponent, President Joe Biden, met onstage in June.
Do AAA CLOs Still Make Sense in a Declining Rate Environment?
On the back of recent cooling in economic growth, an uptick in unemployment, and moderating inflation, the Federal Reserve (Fed) looks set to begin its rate-cutting cycle at its September meeting.
Emphasize Consistency to Navigate Volatility
An analysis of the leadership reversal and market sell-off observed in recent weeks and why an emphasis on equities with consistent fundamentals is justified.
Employment Weakness Cements Our View
August’s employment report, which was weaker than markets were expecting but stronger than our call, cements our view that the easing cycle will begin during the next FOMC meeting, September 17-18.
Slower Faster
Friday’s employment report suggests the US economy may be slowing down faster than most investors think
A Bull Steepening Is Bearish for Stocks
Part one of this series described the burgeoning bull steepening yield curve environment and what it implies about economic growth and Fed policy. It also discussed the three other predominant types of yield curve shifts and what they suggest for the economy and Fed policy.
Direct Indexed Tax Loss Harvesting: Are the Benefits Worth the Fees?
In this article, we’re going to throw some cold water on the DI love-fest by explaining why most tax-sensitive investors would be better off with a simpler approach to tax loss harvesting.
US Bitcoin ETFs Bleed $1.2 Billion in Longest Run of Net Outflows
US Bitcoin exchange-traded funds have posted their longest run of daily net outflows since listing at the start of the year, part of a wider retreat from riskier assets in a challenging period for global markets.
Risks Facing Bullish Investors As September Begins
Since the end of the “Yen Carry Trade” correction in August, bullish positioning has returned with a vengeance, yet two key risks face investors as September begins. While bullish positioning and optimism are ingredients for a rising market, there is more to this story.
The Time Has Come
We are entering a time I think will include a deep crisis. We are going to need each other. We really do need to “find our tribe.”
The Yield Curve Inversion Just Ended, but Economic Risks Remain
The U.S. economy may be heading into choppy waters, and investors might be wise to buckle up.
Fed Rate Cuts Coming in September: What’s Next?
The main focus for investors should is no longer if the Fed will cut rates in 2024, but how much and how quickly the Fed will lower interest rates.
Portable Alpha: Divorcing and Remarrying Alpha and Beta
The concept of portable alpha is over 40 years old. And while it has evolved through various forms over that time, it continues to be a valuable portfolio tool for institutional investors. Arguably, the most popular iteration right now is adding alpha expected from hedge funds on top of synthetic beta exposure.
Treasury Yields Snapshot: September 6, 2024
The yield on the 10-year note ended September 6, 2024 at 3.72%, the 2-year note ended at 3.66%, and the 30-year at 4.03%.
Why Singapore Is Bringing Blockchain Into Mutual Funds
Most people see “blockchain” and “funds” in the same sentence and immediately think of pools of money betting on cryptocurrencies like Bitcoin and Ether. That isn’t how Singapore sees the utility of distributed ledgers.
Navigating Financial Aid: New FAFSA Rules and Tips for Families
Recent changes to the FAFSA form and process include a simpler form, fewer questions and a revised eligibility formula. Our Bill Cass highlights what you need to know to apply for federal financial aid for college.
Maintain Your Investment Strategy During Election Years
Presidential elections tend to have limited impact on market performance, regardless of party win (although markets prefer Democratic switches). Investors should capitalize on the uptick in market volatility, which investors can use for strategic investing.
Can ETFs Capture Private Equity Markets?
Private assets are the fastest-growing market in the financial world, but could be the most challenging field for ETF providers to penetrate.
It's Time … For a Fed Pivot
Investors should be careful what they wish for in hoping for an aggressive Fed rate cutting cycle, given stocks tend to do better when cuts are slow and steady.
Small Wonders: Overlooked Japan Small Caps Poised for Resurgence
After a decade of consistent outperformance, Japanese small caps began underperforming their large cap peers in 2018, a trend that has accelerated since 2023.
What Every Leader Should Understand
This week I had the chance to run a half-day workshop helping seasoned, successful advisors learn techniques for emerging as strong leaders, so I’ll share some of the information here in this column.
Would-Be Corporate Dip Buyers Armed With Fresh $107 Billion
Equity bulls looking for signs of relief after Tuesday’s stock rout may get a hand from a familiar friend: corporate America.
Nvidia Rout Has Traders Watching $100-Share Level Amid ‘Vacuum’
The sharp selloff that wiped a record $279 billion off Nvidia Corp.’s market value on Tuesday has traders scouring charts for clues as to where the pain might end.
August Sees Markets Close Strong After Tough Start
A soft landing for the U.S. economy still appears to be the most likely outcome.
The S&P 500, Dow and Nasdaq Since Their 2000 Highs
Here is a look at real (inflation-adjusted) charts of the S&P 500, Dow 30, and Nasdaq composite since their 2000 highs. We've updated this through the August 2024 close.
Listening Is Not Enough to Make the Sale
You did everything by the book. Your prospect talked and you listened. But listening alone is not enough to build trust.
Sizzling ETF Flows in Manic Markets Fuel a $609 Billion Haul
Half your coworkers might have just spent August in Europe, but there were no holiday doldrums in the booming world of ETFs.
Shorts Are Circling Some of the AI Boom’s Biggest Question Marks
It’s the story of so many stock market manias: A transformative technology juices a few companies, a bunch of more questionable outfits follow in their wake, and Wall Street buys it all. Then time sorts out what’s real from fake.
Apple Rally Fueled by AI Promises Approaches a Crucial Test
Apple Inc.’s upcoming iPhone release has sent its stock price soaring because of promised artificial-intelligence features. Those gains appear vulnerable, at least in the short term, if history is any guide.
Quant Street September 2024 Investor Letter: All Eyes on the Fed
After a bit of an early-August swoon, the stock market came roaring back in the last few weeks of the month. The S&P 500 finished up 2.4%, though certainly in the early days of August, that did not feel like a particularly likely outcome. In client conversations a few days into the selloff, our feeling was to stay put and not tinker with the portfolios we suggested in early August.
ISM Manufacturing Index Contracts for 5th Straight Month
The Institute for Supply Management (ISM) manufacturing purchasing managers index (PMI) inched up to 47.2 in August but remains in contraction territory for a fifth straight month. The index has now contracted for 21 of the past 22 months. The latest reading was worse than the forecast of 47.5.
S&P Global US Manufacturing PMI™: Lowest Level of 2024
The August S&P Global US Manufacturing PMI™ fell to 47.9 in August from 49.6 in July, indicating a modest deterioration in business conditions for a second straight month. The latest reading was just below the forecasted reading of 48.0 and is the index's lowest level of the year.
Why Gold Stocks Could Be a Contrarian Investor’s Dream Right Now
As I write this, gold continues to trade above $2,500 an ounce after surging past the psychologically important level for the first time ever in mid-August. For seasoned gold mining investors, this should be a moment of validation. After all, the yellow metal has long been seen as the ultimate hedge against economic uncertainty.
Treasury Yields: A Long-Term Perspective
As of August 31, 2024, the 10-year note was 339 basis points above its historic closing low of 0.52% reached on August 4, 2020.
World Markets Watchlist: August 30, 2024
Seven of our eight indexes on our world watch list have posted gains through August 30th, 2024. The U.S.'s S&P 500 finished in the top spot with a year-to-date gain of 19.09%. Tokyo's Nikkei 225 finished in second with a year-to-date gain of 15.49% while India's BSE SENSEX finished in third with a year-to-date gain of 14.57%.
RecessionAlert Weekly Leading Economic Index
The weekly leading economic index (WLEI) is a composite for the U.S economy that draws from over 20 time-series and groups them into the following six broad categories which are then used to construct an equally weighted average. As of August 23rd, the index was at 24.827, down 1.545 from the previous week, with 4 of the 6 components in expansion territory.
The Pecking Order of 401(K) Plan Design: A Bird’s Eye View
Establishing the optimal workplace retirement plan follows a pecking order, which starts by prioritizing plan design over investments. Our Mike Dullaghan discusses the process.
Fed Favored Inflation Gauge’s Mild Gain Sets Stage for Rate Cut
The Federal Reserve’s preferred measure of underlying US inflation rose at a mild pace and household spending picked up in July, reinforcing policymakers’ plan to start cutting interest rates next month.
Supply Disruptions Could Push Copper Prices Higher
Copper has been trending lower since the middle of May, but supply disruptions in Latin America could help reverse that trend.
Moving Averages: S&P Finishes August 2024 Up 2.3%
Valid until the market close on September 30, 2024
This article provides an update on the monthly moving averages we track for the S&P 500 and the Ivy Portfolio after the close of the last business day of the month.
Two Measures of Inflation: July 2024
The BEA's core Personal Consumption Expenditures (PCE) Price Index for July showed that core inflation continues to be above the Federal Reserve's 2% long-term target at 2.6%. The July core Consumer Price Index (CPI) release was higher, at 3.2%. The Fed is on record as using core PCE data as its primary inflation gauge.
The Big Four Recession Indicators: Real Personal Income Up 0.2% in July
Personal income (excluding transfer receipts) rose 0.32% in July and is up 4.1% year-over-year. However, when adjusted for inflation using the BEA's PCE Price Index, real personal income (excluding transfer receipts) was up 0.16% month-over-month and up 1.6% year-over-year.
Chicago PMI Edged Higher in August
The latest Chicago Purchasing Manager's Index (Chicago Business Barometer) edged up to 46.1 in August from 45.3 in July. The latest reading is better than the 45.0 forecast but keeps the index in contraction territory for a ninth straight month.
Real Disposable Income Per Capita Up 0.1% in July
With the release of July's report on personal incomes and outlays, we can now take a closer look at "real" disposable personal income per capita. At two decimal places, the nominal 0.21% month-over-month change in disposable income comes to 0.06% when we adjust for inflation. The year-over-year metrics are 3.09% nominal and 0.58% real.
PCE Inflation Rises 2.5% in July, Less Than Expected
The BEA's Personal Income and Outlays report revealed inflation remained at its lowest level since early 2021. The PCE price index, the Fed's favored measure of inflation, was up 2.5% year-over-year, just below the forecasted 2.6% growth. On a monthly basis, PCE inflation was up 0.2% from June, as expected.
Fed Pivots and Baby Aspirin
When you see that behavior at extreme valuations, it tends to be a sign of underlying skittishness and risk aversion. When valuations are setting record extremes because the news can’t get any better, even a slightly less optimistic outlook becomes a risk.
One-Day-Only Funds Are Jack Bogle’s Nightmare Brought to Life
The late Jack Bogle — father of the first index fund — famously loathed their exchange-traded offspring, warning that it only incentivize speculative trading among “fruitcakes, nut cases and lunatic fringe.” Fast forward to 2024, and critics warn a new generation of ETFs are designed to do exactly that.
Break the Cycle and Create Generational Wealth
Many recent studies have been done on the economics of different generations. Researchers want to know if Millennials and Gen Z are in fact worse off than their Boomer and Gen X parents. There are quite a few ways to look at this data.
The Shot Heard Round The World
The path for lower rates in the U.S. has finally arrived.
Fundamentals Matter
While short-term fluctuations and sudden selloffs have tested the markets, key indicators such as corporate profits, employment data, and economic resilience have held firm.
Q2 Second Estimate: GDP Per Capita versus GDP
The second estimate for Q2 GDP came in at 2.95%, an acceleration from 1.41% for the Q1 final estimate. With a per-capita adjustment, the headline number is lower at 2.48%, a pickup from 0.95% for the Q1 headline number.
The 50 Percent Rule
Rules are made to be broken, so I would call this a 50 percent starting place in your discussion with the client. I certainly wouldn’t recommend only a 50 percent equity portfolio to a young client with a high willingness and need to take risk or the same to any client who had a low willingness and need to take risk.
An Inside Look at the Q2 2024 GDP Second Estimate
Real gross domestic product (GDP) is comprised of four major subcomponents. In the Q2 GDP second estimate, three of the four components made positive contributions.
How to Get Full Protection From Your Homeowners Insurance
If your home and/or its contents are destroyed or damaged by a disaster such as a fire or flood, the insurance company will need a complete list of what was lost. Do you have such a list?
Pending Home Sales Unexpectedly Fall 5.5% in July to All-Time Low
The National Association of Realtors® (NAR)unexpectedly fell 5.5% in July to 70.2, its lowest level in history. Pending home sales were expected to inch up 0.2% from the previous month. The index is down 8.5% from one year ago.
Nvidia Pays Price of Lofty Expectations, Stoking Fear for Rivals
Nvidia Corp.’s earnings report needed to be perfect for a stock that’s added nearly $2 trillion in market value in the past year. In the end, a broad beat still sparked a selloff.
With AI Story Intact and Rate Cuts Imminent, Markets Turn Higher
Nvidia Corp.’s earnings report was impressive by virtually any metric — except its own recent history.
Nvidia Tumbles After Disappointing Forecast, Blackwell Chip Snags
Nvidia Corp. failed to live up to investor hopes with its latest results on Wednesday, delivering an underwhelming forecast and news of production snags with its much-awaited Blackwell chips.
Debt Burdens, Elevated Rates to Test Equity Investors
An extended period of elevated interest rates may have long-term implications for both consumers and businesses—affecting how investors value company shares.