Most people don’t understand how to be good decision-makers, but they could get better, says Annie Duke, a decision strategist and retired professional poker champion.
Projections and analyses don't reflect the potential effects of the Covid-19 pandemic on Social Security. Without swift action by the government, a new crisis may be at hand.
It identified 244 companies during the 2020 annual proxy season that weren’t doing enough to either prepare their businesses for a warming planet or inform investors about the climate-change risks.
The Fed’s recent stress tests raised concern about solvency risks to US banks. But as second-quarter earnings season begins, investors may find that some banks are much more resilient than expected.
Many reports now say that the uber-wealthy have pulled back their spending on non-essential goods and services due to the coronavirus. But that doesn’t mean they’ve cut spending entirely.
Imagine telling clients you’re their guru, guide and gladiator. Learn a simple framework to help articulate your distinctive value.
It is said that a rising tide lifts all boats, and that goes for monetary tides as well. Watching the market every day, this is exactly what it has felt like; stocks just want to go up...fundamentals be damned.
Recently, in the wake of the dramatic, catalyzing events associated with the COVID-19 pandemic, analysts have struggled to match the action in the Economy with that of the Financial System. Existing disparities of inequality and maldistribution have been dramatically exacerbated as the financial indices have soared.
The economic calendar is extensive with a focus on housing and consumer behavior. Expect market participants to look for any sign that the economic recovery is stalling in the face of the COVID-19 surge and the slower pace of reopening.
It is safe to say that expectations are low as the bottom up consensus for the S&P 500 calls for a year over year earnings decline of about 45% in the 2Q. This would be the largest year over year decline since 2008. But that is well understood at this point.
Wells Fargo & Co. plummeted after reporting its first quarterly loss since 2008 as loan-loss provisions soared with the bank expecting a more severe downturn from the coronavirus pandemic.
Since 2014, mega-cap stocks have substantially outperformed small-cap stocks. However, today we sit at the widest valuation gap between small caps and large caps in nearly two decades. This doesn’t seem to be a case of simple mean reversion. Rather, there have been several fundamental factors contributing to the performance gulf between large caps and small caps over the past few years—some of which have been more structural in nature, and many of which still exist today.
In order to accelerate its presence in North America, TrackInsight has joined with Nasdaq to distribute its services to financial institutions and promote the usage of the platform amongst its network of investment professionals.
More managers are questioning whether the traditional asset mix can produce the same returns going forward.
The most watered-down smart-beta ETFs have attracted the most money.
Let's take a closer look at Thursday's employment report numbers on Full and Part-Time Employment.
When it comes to growth, think small.
It's time to think about something other than COVID, statues, the election, and defunding the police. How about higher education? Specifically, student loans and grants.
The conventional wisdom is that put options are too expensive to use as “tail risk” insurance against extreme losses in equities. But reports earlier this year of their spectacular success in a fund advised by Nassim Nicholas Taleb prompted me to evaluate whether investors should use them.
Buffett changed his mind and bought a 10% stake in all four of the largest U.S. airlines. For a few years it seemed that he was finally right about the airlines.
Supporting the beaten-down labor market is the Federal Reserve’s “major focus,” not inflation nor risk asset prices. Doing “whatever we can and for as long as it takes.”
Next time you see a client’s resolve to stay invested waver, ask them two questions…
How can we reconcile the dissonance between economic conditions and stock valuations? I offer four theories.
The value of this year’s annual hedge fund performance survey was turned on its head when a pandemic shut down the global economy and sent securities plummeting. But a deeper look at consistently performing funds revealed managers that as a group have largely been able to weather the storm better than the market and their peers.
All of the increased tax burden falls on the top 2%, a problem for a couple of big reasons, the author maintains.
Saying that extreme stock market valuations are “justified” by low interest rates is like saying that poking yourself in the eye is “justified” by smashing your thumb with a hammer.
The economic calendar was thin. Investors remained concerned about rising cases of COVID-19. A return to a full lockdown appears unlikely, but the pace of improvement in the economy is expected to slow.
The U.S. Treasury is expected to announce a June budget shortfall of about $863 billion, bringing the 12-month total to nearly $3 trillion (or about 14% of pre-pandemic GDP). The red ink will continue. Lawmakers are expected to approve another round of federal stimulus later this month. None of that is worth losing sleep over.
Virtual meetings are inherently different from face-to-face encounters, largely because they eliminate many of the social obligations that deeply influence interpersonal behaviors. Experience with conducting virtual meetings in a variety of contexts has revealed that they are typically harder to manage than live meetings.
The global market outlook is already hazy in light of the COVID-19 pandemic, and the upcoming US presidential election adds another layer of uncertainty.
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.
Precious metals were the big winners for the first six months of 2020. Spot gold took the first place position, rising over 17 percent, followed in second place by silver, up nearly 2 percent. Palladium rounded out the top three, essentially flat at negative 10 basis points.
Today we’ll look at the data, including some non-government sources. As you will see, millions of workers will stumble through this period, and they may be the lucky ones.
So much has happened already that it may seem hard to believe we’re only halfway through the year. What can we expect for the remainder of 2020? An economic recovery looks promising, but a second wave of the pandemic could set us back. See what Commonwealth CIO Brad McMillan is watching and what other factors could affect how we end the year in our Midyear Outlook 2020: Will Risks Create Detour on Road to Recovery?
COVID-19’s path is evident everywhere we look: spending, saving, staffing, sentiment, and sports.
The first half of 2020 was dominated by the COVID-19 pandemic, which hit the municipal bond market hard. State and local governments experienced a sharp and sudden drop in revenue, and an increase in expenses, amid stay-at-home orders and business shutdowns.
I find it very interesting that Alexion Pharmaceuticals Inc. (ALXN) after going public in 2001, did not generate their first profit until December 2008. As we all know, this was in the throes of what is now known as the Great Recession of 2008.
Low yields plus rising defaults seemingly leave little ground for bond investors seeking safety or income—or both. But for investors who remain flexible, those objectives aren’t as distant as many think.
Wells Fargo & Co. is launching a $400 million fund to donate the fees it got from the Paycheck Protection Program back to small businesses, particularly ones that are minority-owned.
Brad McMillan, Commonwealth’s CIO, gives his 2020 midyear outlook. The rest of 2020 will be about the virus. We’re seeing localized outbreaks, but the necessary countermeasures are in place. So, we can reasonably expect the virus to remain under control. Despite the medical setbacks, millions of jobs have returned, along with consumer confidence and spending. The recovery remains on track and is likely to continue. And that's exactly what the markets are expecting. But will there be volatility ahead? Watch this video to find out. Follow Brad at blog.commonwealth.com/independent-market-observer.
In a new white paper, the GMO Emerging Markets Equity Team argues that Emerging Markets in aggregate are more resilient today than in prior periods, an important consideration as investors evaluate the rebound the asset class has experienced since late March.
We've updated our monthly workforce analysis to include Thursday's Employment Report for June. The unemployment fell to 11.1%, and the number of new nonfarm jobs (a relatively volatile number subject to extensive revisions) came in at 4.8M.
In 1976, Grateful Dead released “What a Long Strange Trip It’s Been.” The second quarter felt like a long strange trip, except it took place over just three months. We entered the quarter trying to flatten the curve, did so, and saw the economy reopen and social distancing restrictions relaxed to a degree.
Against the backdrop of this new reality, and as most people are doing these days, I found myself browsing through Netflix. That’s when I noticed that the classic Robert Zemeckis movie, Back to the Future, was one of the trending titles. This made me think: what if we could travel back in time, not even as far back as 1955, but rather to January 1 of this year?
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.
High-quality companies outside the U.S. look especially attractive to us. And their stocks have underperformed recently, possibly giving them greater upside potential.
The 20th century Baby Boom was one of the most powerful demographic events in the history of the United States. We've created a series of charts to show seven age cohorts of the employed population from 1948 to the present.
The S&P dropped at the end of last week and then started Monday high. The index hovered around a 65 point range the rest of the week. The index is up 0.70% from last Thursday and is down 2.44% YTD.
Note: This commentary has been updated with the latest numbers from Thursday's Employment Report. Consider: Today nearly one in three of the 65-69 cohort and one in five of the 70-74 cohort are in the labor force.
Here's an interesting set of charts that will especially resonate with those of us who follow economic and market cycles. Imagine that five years ago you invested $10,000 in the S&P 500. How much would it be worth today, with dividends reinvested but adjusted for inflation? The purchasing power of your investment has increased to $15,442 for an annualized real return of 8.72%.