Commentary

This Is Nuts…Again. Reducing Risk As Tech Goes 1999

When looking at the acceleration in the price of the Nasdaq, and particularly within the small group of stocks driving that advance, you can begin to fathom our concerns. Furthermore, the divergence between the Nasdaq and the S&P 500 index is emulating the late 90’s.

Commentary

The Death Of Fundamentals & The Future Of Low Returns

Over the last quarter, the “Death of Fundamentals” has become apparent as investors ignore earnings to chase market momentum. However, throughout history, such large divergences between fundamentals and price have resulted in low future returns. This time is unlikely to be different.

Commentary

The Theory Of MMT Falls Flat When Faced With Reality (Part II)

If you missed Part-1 of our series on the “Theory Of MMT Falls Flat When Faced With Reality,” start there. In Part-2, we complete our analysis of the theory and the potential ramifications. The premise of our discussion was this recent explanation of “Modern Monetary Theory” by Stephanie Kelton. As discussed previously, economic theory always sounds much better than how it works out in reality.

Commentary

The Theory Of MMT Falls Flat When Faced With Reality (Part I)

If you haven’t heard of Modern Monetary Theory, or “MMT,” you will soon. If you recently lost your job due to the economic shut down, and received a stimulus check, you are already a beneficiary. As we will discuss in Part-1 of this two-part series, MMT’s theory falls flat when faced with reality.

Commentary

Unicorns, Rainbows, & Fully Invested Bears

With sentiment currently at very high levels, combined with low volatility, and a high degree of investor complacency, all the ingredients necessary for a market reversal are currently present. Am I sounding an “alarm bell” and calling for a massive correction? No.

Commentary

Is It 1999 or 2007? Retail Investors Flood The Market

Is it 1999 or 2007? Retail investors flood the market as speculation grows rampant with a palpable exuberance and belief of no downside risk. What could go wrong?

Commentary

The Great Divide Between Stocks & The Economy

There are a tremendous number of things that can go wrong in the months ahead. Such is particularly the case of surging stocks against a depressionary economy.

Commentary

Rationalizing High Valuations Won’t Improve Outcomes

Rationalizing high valuations won’t improve future return outcomes.

Commentary

The Bull Is Back! Markets Charge As Economy Lags

On Friday, the Bureau Of Labor Statistics released the widely expected employment report for May. Despite continued weekly jobless claims over the last month exceeding more than 8-million, the BLS reported an increase of more than 2.5 million jobs in May.

Commentary

CFNAI Economic Indicator Crashes Most On Record

In 2013, I wrote an article discussing comments made by Russ Koesterich, CFA, regarding the Chicago Fed National Activity Index (CFNAI). Given this economic indicator just crashed by the most on record, it is worth reviewing his comments.

Commentary

Is The Fed Walking Into A Trap?

Currently, the Fed is injecting liquidity into the markets and economy at a record pace. While liquidity does have positive short-term benefits, is the Fed walking into a trap?

Commentary

Did The Fed Over-React To A “Natural Disaster?”

Is it possible the Fed over-reacted to a natural disaster? There are two different types of “recessionary” events that occur throughout history. The first is a “business cycle” recession, which happens with some regularity as excesses build up in the economy. These cycles generally take 12-18 months to complete as those excesses are reversed.

Commentary

Why Siegel Is Wrong About End Of Bond Bull Market

Jeremy Siegel, in time, will likely be proved wrong about the end of the “40-year bond bull” market. History suggests that not only is the “bond bull” alive and well, it likely has quite a long way as the U.S. will become more like Japan over time.

Commentary

The Federal Reserve & It’s Ongoing Destruction Of The Bottom 90%

The Federal Reserve seemingly is an ongoing mission to destroy the bottom 90%.

Commentary

“Savings Mirage” Won’t Save The Economy

The fiscal and monetary responses to the “coronavirus” created a surge in savings. While many hope those savings will go back to work, the “savings mirage” won’t save the economy.