Stocks Disconnected from Reality? Here's Why Valuations Are Still Rational
It’s hard to recall a more confusing quarter for investors. While economic data plumbed depression-level depths for most of the past three months, equity markets rallied heavily. This odd juxtaposition led many to opine that markets had disconnected entirely from the economy. We disagree.
4 Markers We’re Watching for Coronavirus Progress
We entered the new year with fresh economic momentum fueled by global central bank rate cuts and a tamping down of the trade war. Global markets rallied until mid-January, at which point news of a novel coronavirus outbreak in China emerged.
Ever Changing ... Never Changing
A new decade, seismic shifts and the importance of diversification.
Peak Political Uncertainty
Never in my investment career can I recall political “happenings” carrying so much weight in daily market movements. Today’s markets are whipsawed by political slings and arrows, often in the form of tweets or breaking news reports. And “investors” increasingly are reacting impulsively to a reality that’s shifting minute-by-minute.
Is It Too Late Now to Say Sorry? Second Quarter 2019
- Investors must channel their inner Justin Bieber and ask themselves, “Is it too late now to say sorry?” More specifically: Did the Federal Reserve tighten so much last year that no matter what they do this year, the recession writing is already on the wall?
- Secondly, are the U.S. and China capable of finding a trade war solution after one side eventually says they are sorry?
First Quarter 2019
Q1 2019 proved to be the exact opposite of Q4 2018; it was the quarter where nearly everything worked. Virtually all asset classes produced positive returns, from U.S. and International equities of all sizes and sectors, to higher quality bonds and junk bonds, and, yes, even commodities floated with the rising tide.
Fourth Quarter 2018 - The Year When Nothing Worked
2018 will be broadly remembered as a year when nothing worked and daily stock market volatility spiked. This contrasted with 2017 where seemingly everything pushed higher, and volatility was low. But in 2018, nearly every single asset class and all but one major stock market index (Brazil) around the globe posted negative returns.
Goldilocks and the Three Fears
It is hard to say with certainty what drives trading on any particular day, but it doesn’t seem a stretch to say that over the past few months a combination of tariffs and Federal Reserve rate hike fears have broadly impacted both equity and fixed income markets.
Second Quarter 2018: Unique But Not Different
For much of this recovery and expansion, many have opined that this economic cycle would ultimately end very differently than those of the past. We have resisted this narrative and instead explained our belief that this cycle will indeed follow the same path and end like all others.
First Quarter 2018 Singles and Doubles, Not Home Runs
2018 began much as 2017 ended, with steadily rising equity markets, low interest rates and burgeoning market optimism. Indeed, investors were increasingly convinced that the lowest stock and bond market volatility since 1965 was set to continue in 2018. Who could blame them?
Fourth Quarter 2017: This is (not yet) the Summer of 1969
What a difference a year makes. It is hard to recall but at the turn of calendar to 2017 investors were debating whether stronger economic growth would ever return, largely because it had been so weak for much of late 2015 and 2016.
Third Quarter 2017: I’m All Right … Don’t Nobody Worry About Me
The reports of the coming economic demise continue to prove premature. For much of the past few years, we have filled these pages with our data-driven retort to the constant noise about the next impending economic and market downturn.
"Ain't No Mountain High Enough"
Who can forget the harrowing start to the year that saw markets plunge 13% in the first 20 days of January? China debt fears, global deflation, secular stagnation worries, the Brexit and the United States election surprises were the dominant headlines of 2016.