It’s becoming more and more difficult to be in the fossil fuel business. On both sides of the Atlantic, lawmakers and unelected bureaucrats are turning up the heat, so to speak, on companies over the issue of climate change.
Today we’ll take another walk through the inflation debate. Is it still transitory or should we expect a light-1970s inflation going forward? The answer is critically important.
We don’t disagree the S&P 500 could well hit a target of 5000. But, let us be honest about the reasons why...
The bond market has been in hibernation for months, and investors may have become complacent about risks.
On September 3, 2021, Prime Minister Yoshihide Suga announced his decision to not run in the upcoming ruling Liberal Democratic Party leadership race later this month. Portfolio Manager Shuntaro Takeuchi provides his thoughts on the current political environment and outlook for Japanese equities.
Month-over-month nominal sales in August was up 0.71% and up 15.1% YoY. Real Retail Sales, calculated with the seasonally adjusted Consumer Price Index, increased by 0.43% and was up 9.4% YoY.
Many Fed members are vocal about tapering soon, but the Fed has not backed their words with action. Might the Fed be speaking loudly but carrying a feather?
The Census Bureau's Advance Retail Sales Report for August was released this morning. Headline sales came in at 0.71% month-over-month to two decimals and was above the Investing.com forecast of -0.8%. Core sales (ex Autos) came in at 1.81% MoM.
This morning's seasonally adjusted 332K new claims, up 20K from the previous week's revised figure, was above the Investing.com forecast of 330K.
The latest Manufacturing Index came in at 30.7, up 11.3 from last month's 19.4. The 3-month moving average came in at 24.0, down from last month. Since this is a diffusion index, negative readings indicate contraction, positive ones indicate expansion. The Six-Month Outlook came in at 20, down 13.7 from the previous month's 33.7.
Several policy-related risks loom in September and October that may lead to an increase in market volatility. The debt ceiling needs to be raised (likely by mid-October), the government needs to be funded to avoid a shutdown by the end of September...
Here is a table showing the annualized change in Headline and Core CPI, not seasonally adjusted, for each of the past six months. Also included are the eight components of Headline CPI and a separate entry for Energy, which is a collection of sub-indexes in Housing and Transportation. We can make some inferences about how inflation is impacting our personal expenses depending on our relative exposure to the individual components.
Real interest rates on Treasuries have been strongly negative throughout 2021. But why do investors keep piling into these negative “real” yielding assets? BlackRock’s systematic investment experts decode the markets to reveal why rates are so disconnected from fundamental values and what it means for your bond portfolio.
There are several “paradigm shifts” impacting markets today, according to Templeton Global Macro CIO Michael Hasenstab. He outlines how central banks might approach tapering of pandemic-driven asset purchases, and the potential investment risks and opportunities he sees.
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.
It’s unfortunate but true: Influential Republican politicians are playing another round of political chicken that could easily lead to a damaging brush with default on the national debt.
As of September 13, the price of Regular and Premium was down a penny each from the previous week. According to GasBuddy.com, California has the highest average price for Regular at $4.38 and Mississippi has the cheapest at $2.78. The WTIC end-of-day spot price closed at 70.45, up 3.1% from last week and up 48% from the beginning of the year.
The headline number for August came in at 100.1, up 0.4 from the previous month. The index is at the 57th percentile in this series.
The volatility caused by the pandemic has driven greater interest in alternatives to diversify portfolios and preserve wealth. It is part of a shift from passive to active management. However, getting information on these alternative assets has been disjointed. My guest, Mark Salameh, created AltsAxis to fill a major gap by becoming that one place allocators can access a wide range of dynamic, comprehensive, and objective data that they can use to make a well-informed alternative investment decision.
Applying a relatively single-indicator trend-following strategy is an excellent way to obtain meaningful exposure to the overall market with significantly lower downside risk and higher long-term risk-adjusted returns.
In addition to football, this fall will be eventful for our team of monetary policymakers at the Federal Reserve. Quarterbacked by Chairman Powell, the Fed will draft its route to easing its accommodative stance now that the economic recovery has put some points on the scoreboard.
Value has its day in the sun. But are investors learning the right lessons from it?
With the S&P 500 up nearly 20% and international developed stocks up 13% year-to-date, the markets are having a banner year so far.
U.S. equity markets continued to rally in August, with all three major indices setting new record highs during the month. We did see some midmonth volatility, but the Dow Jones Industrial Average gained 1.50 percent, while the S&P 500 experienced a 3.04 percent gain.
New research confirms that institutional investors, such as mutual funds, outperform the market before fees, and they do so at the expense of retail investors. That is bad news for retail investors and for investors in active mutual funds, who underperform after fees.
U.S. Treasuries ended their 4-month streak of positive returns and falling yields in August. Intermediate maturity yields rose more than shorter and longer maturities, as the market began to see through the impact of the Delta variant and focus more on the Federal Reserve’s plan to scale back their bond buying program.
Markets now know that the taper can be divorced from interest rate hikes. But for how long? What are your expectations on the timing of tapering?
With the Q2 GDP Second Estimate and the August close data, we now have an updated look at the popular "Buffett Indicator" -- the ratio of corporate equities to GDP. The current reading is 214.2%, up from 204.7% the previous quarter.
We've updated our monthly workforce analysis to include the latest Employment Report for August. The unemployment rate dropped to 5.2%, and the number of new nonfarm jobs (a relatively volatile number subject to extensive revisions) came in at 235K.
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 $20,758 for an annualized real return of 14.5%.
The latest JOLTS report (Job Openings and Labor Turnover Summary), with data through July, is now available.
The real estate market may be cooling slightly, but those who have sold their homes recently or plan to will still be reaping big gains from Westchester, New York, to Oakland, California.
Uncertainty always exists in financial markets.
As of August 31, 2021, the 10-year note was 78 basis points above its historic closing low of 0.52%, reached on August 4, 2020
Let's take a closer look at Friday's employment report numbers on Full and Part-Time Employment.
Special purpose acquisition companies (SPACs)—also known as blank-check companies—have gained immense popularity among investors since the beginning of 2020, despite being around for decades.
The First Eagle Credit Opportunities Fund (FECRX) takes an intensive, research-driven approach to income-oriented opportunities available across the alternative credit spectrum—including both private and public investments—in an effort to deliver current income while providing long-term risk-adjusted returns through a focus on senior-secured assets. I spoke with its managers, Andrew Park and Christian Champ.
On August 24 and 25, we held our second annual Thought Leader Summit. Here is a short summary of each session and a link to watch the replay for CE credits.
This commentary has been updated to include Friday morning's release of Nonfarm Employment. August's 235K increase in total nonfarm payrolls had revisions that resulted in 134K more jobs than previously reported. The Investing.com consensus was for 665K jobs gained and the unemployment rate to fall to 5.2%.
A California county’s $21 billion pension is considering whether to drop Ray Dalio’s hedge fund after it underperformed for most of the past 16 years.
Investors are increasingly looking outside developed countries for investment opportunities, but it’s important to remember that not all Emerging Market countries are the same. In this report, we compare the opportunities in China & Brazil.
Q&A with Kathlyn Collins: Understanding the context of the recent regulatory announcements through an ESG lens.
As of the end of August, the index's year-to-date gains exceed 20%.
Mark Mobius, the legendary emerging markets investor, says that 10% of investors’ portfolios should be in gold in anticipation of currency devaluation as a result of unprecedented stimulus measures.
The U.S. International Trade in Goods and Services, also known as the FT-900, is published monthly by the Bureau of Economic Analysis with data going back to 199 and details U.S. exports and imports of goods and services. Today's headline number of -70.05B was better than the -71.00B Investing.com forecast.
A properly diversified credit portfolio should have exposure to both high-yield corporate bonds and bank loans.
The August US Manufacturing Purchasing Managers' Index conducted by Markit came in at 61.1, down from the final July figure. Markit's Manufacturing PMI is a diffusion index: A reading above 50 indicates expansion in the sector; below 50 indicates contraction.
A busy summer on the fiscal front in Washington that’s seen progress on budget and infrastructure legislation could soon give way to another showdown over the U.S. statutory debt ceiling, potentially signaling volatility for investors in the months ahead.
The headline number of 113.8 was a decrease of 11.3 from the final reading of 125.1 for July. This was below the Investing.com consensus of 124.0.
What if it were possible to immunize yourself from market volatility? Thankfully, it doesn’t require a vaccination.
New research shows that the ESG portions of mutual funds underperformed the remainder of the funds and did so with higher risk. But the magnitude of those differences was small.
In this edition, Chris Brightman, chief executive officer and chief investment officer of Research Affiliates, explains their outlook on long-term inflation and discusses how investors can prepare for this risk.
With the release of this morning's report on July's Personal Incomes and Outlays, we can now take a closer look at "Real" Disposable Personal Income Per Capita. At two decimal places, the nominal 1.08% month-over-month change in disposable income is cut to 0.66% when we adjust for inflation. This is an increase from last month's 0.03% nominal and 0.56% real decreases. The year-over-year metrics are 0.13% nominal and -3.89% real.
Personal Income (excluding Transfer Receipts) in July rose 0.7% and is up 8.2% year-over-year. However, when adjusted for inflation using the BEA's PCE Price Index, Real Personal Income (excluding Transfer Receipts) MoM was up 0.23%. The real number is up 3.8% year-over-year.
One of the most worrisome risks for state and local governments just got a little more manageable.
P is for aligning products to meet each client’s unique goals, circumstances and preferences.
The big story in the ETF industry over the last several years has been the growth of options-based strategies. Those products have accumulated assets at a rapid pace. They are offering advisors and their clients low-cost solutions that have return profiles, including downside protection and upside participation, that are not available in conventional strategies.
During a trying time for the world in 1939, Winston Churchill famously described the largest country in the world and soon-to-be second superpower, the Soviet Union, as “a riddle wrapped in a mystery inside an enigma.”
The stock market could use some mouthwash.
Signs are growing that U.S. Treasury yields may continue to march higher even if Federal Reserve Chair Jerome Powell strikes a balanced tone at Jackson Hole this week.
The Census Bureau has posted the Advance Report on Durable Goods New Orders. This series dates from 1992 and is not adjusted for either population growth or inflation. Let's now review Durable Goods data with two adjustments.
There are many potential advantages to investing in tax-exempt municipal bonds, but not all advisors are aware of additional strategies and investment vehicles that can help them meet muni-focused client needs.
For the third year in a row, the top 50 hedge fund managers, relying on a variety of strategies, generated net returns comparable to the S&P 500 with significantly less risk and performance that was largely independent of the market. Hedged equity, multistrategy, and global macro funds led the way with more than half the funds in the top 50 managing less than $1 billion.
This year’s annual economic policy symposium in Jackson Hole opens the six months that will likely define the legacy of the Powell Fed’s first term.
The latest new orders number at -0.1% month-over-month (MoM) was better than the Investing.com -0.3% estimate. The series is up 17.6% year-over-year (YoY). If we exclude transportation, "core" durable goods was up 0.7% MoM, which was above the Investing.com consensus of 0.5%. The core measure is up 16.7% YoY.
There is at least a 50/50 chance that headline CPI inflation will exceed 5% for all of 2021, according to Jeffrey Gundlach.
For a long time, it worked. Wealthy investors did, in fact, enhance their yield through the firm’s YES strategy – and they were hooked. But then the market crashed, and the honeymoon was over.
Wall Street’s passive revolution is turning out to be anything but, with active investing alive and kicking in even the sleepiest corners of the ETF world, according to the latest research.
This article explains how the VIX® Index and volatility revert to the mean and why a variance risk premium occurs.
The filing cabinet gave offices a sense of control and granular access by making information visually identifiable. The pandemic and working from home proved how this way of sourcing, accessing, and presenting information is no longer viable.
We provide a practical definition of the ideal personalized risk-free asset, and then we’ll discuss how to construct an efficient portfolio when that ideal asset doesn’t exist in investable form.
Led by improvements in production-related indicators, the Chicago Fed National Activity Index (CFNAI) increased to +0.53 in July from –0.01 in June. Three of the four broad categories of indicators used to construct the index made positive contributions in July, and three categories improved from June. The index’s three-month moving average, CFNAI-MA3, moved up to +0.23 in July from +0.01 in June.
The predominant approach to classifying securities geographically is based on domicile, the legal home of a company. But that approach is losing its relevance. Investors should consider foreign revenue to understand the international risks of investments and portfolios.
New research shows that funds that with an ESG mandate have factor exposures that differ significantly from the market, creating a challenge for investors who seek a specific factor loading for their overall allocations.
Much of the volatility that has recently shaken China’s credit markets has been associated with government interventions.
Did the Fed’s “monetary policy experiment” fail?
So many headlines right now are instilling FUD in investors’ minds, which stands for Fear, Uncertainty and Doubt—from the Afghanistan news to fears on cryptocurrency and the delta variant disrupting travel plans. But don’t fall for it.
Many of you tuned in this week to watch the conversation between me and Michael Saylor, founder and CEO of business intelligence company MicroStrategy.
The question I get most often is “when is the next bear market?” There are three specific items that tend to predict bear markets and recessions with some accuracy.
The resurgent virus should keep a lid on Treasury Yields.
If there’s a single word that captures how Americans feel about their economy as the second pandemic summer draws to a close, it could conceivably be: “meh.”
The U.S. Census Bureau and the Department of Housing and Urban Development have now published their findings for July new residential housing starts. The latest reading of 1.534M was below the Investing.com forecast of 1.600M and a 7.0% decrease from the previous month's 1.650M.
The U.S. Census Bureau and the Department of Housing and Urban Development have now published their findings for July new residential building permits. The latest reading of 1.635M was up 2.57% from the June reading and is above the Investing.com forecast of 1.610M.
Hedging your portfolio from the pending market crash.
The pursuit of growth requires the belief that it’s possible, which is another way of saying you need confidence.
Review the latest Weekly Headings by CIO Larry Adam.
Going forward, we believe that the traditional international allocation and global emerging markets deserves a rethink.
Style boxes and other constructs of the investment industry are meaningless when it comes to portfolio theory, according to financial economist John Cochrane. Instead, investors should focus on cash flows and market equilibrium.
The next market correction will inflict its worst damage on crypto and meme investors, but those saving for retirement in a diversified, disciplined manner will suffer alongside them.
China is in the midst of a tightening regulatory cycle which has led to some investor uncertainty and heightened market volatility.
Volatility/Downside Protection
Fossil Fuels Are Under Siege. Is Misinformation to Blame?
It’s becoming more and more difficult to be in the fossil fuel business. On both sides of the Atlantic, lawmakers and unelected bureaucrats are turning up the heat, so to speak, on companies over the issue of climate change.
Inflation: More Transitory than Expected
Today we’ll take another walk through the inflation debate. Is it still transitory or should we expect a light-1970s inflation going forward? The answer is critically important.
Wall Street Sets Its Sights On S&P 5000
We don’t disagree the S&P 500 could well hit a target of 5000. But, let us be honest about the reasons why...
Is the Treasury Bond Market About to Wake Up?
The bond market has been in hibernation for months, and investors may have become complacent about risks.
Japan Elections and Market Update
On September 3, 2021, Prime Minister Yoshihide Suga announced his decision to not run in the upcoming ruling Liberal Democratic Party leadership race later this month. Portfolio Manager Shuntaro Takeuchi provides his thoughts on the current political environment and outlook for Japanese equities.
The Big Four: August Real Retail Sales Up 0.7%
Month-over-month nominal sales in August was up 0.71% and up 15.1% YoY. Real Retail Sales, calculated with the seasonally adjusted Consumer Price Index, increased by 0.43% and was up 9.4% YoY.
The Fed Speaks Loudly but Carries a Feather
Many Fed members are vocal about tapering soon, but the Fed has not backed their words with action. Might the Fed be speaking loudly but carrying a feather?
Retail Sales Up 0.7% in August, 15.1% YoY
The Census Bureau's Advance Retail Sales Report for August was released this morning. Headline sales came in at 0.71% month-over-month to two decimals and was above the Investing.com forecast of -0.8%. Core sales (ex Autos) came in at 1.81% MoM.
Weekly Unemployment Claims: Up 20K
This morning's seasonally adjusted 332K new claims, up 20K from the previous week's revised figure, was above the Investing.com forecast of 330K.
Philly Fed Mfg Index: "Current Indicators Remain Elevated"
The latest Manufacturing Index came in at 30.7, up 11.3 from last month's 19.4. The 3-month moving average came in at 24.0, down from last month. Since this is a diffusion index, negative readings indicate contraction, positive ones indicate expansion. The Six-Month Outlook came in at 20, down 13.7 from the previous month's 33.7.
Policy Risks Loom But Clarity Ahead
Several policy-related risks loom in September and October that may lead to an increase in market volatility. The debt ceiling needs to be raised (likely by mid-October), the government needs to be funded to avoid a shutdown by the end of September...
Inflation: The Components
Here is a table showing the annualized change in Headline and Core CPI, not seasonally adjusted, for each of the past six months. Also included are the eight components of Headline CPI and a separate entry for Energy, which is a collection of sub-indexes in Housing and Transportation. We can make some inferences about how inflation is impacting our personal expenses depending on our relative exposure to the individual components.
Decoding the “Real” Disconnect Between Interest Rates and Inflation
Real interest rates on Treasuries have been strongly negative throughout 2021. But why do investors keep piling into these negative “real” yielding assets? BlackRock’s systematic investment experts decode the markets to reveal why rates are so disconnected from fundamental values and what it means for your bond portfolio.
Paradigm Shifts Impacting the Investment Landscape: China, Inflation and Monetary Policy
There are several “paradigm shifts” impacting markets today, according to Templeton Global Macro CIO Michael Hasenstab. He outlines how central banks might approach tapering of pandemic-driven asset purchases, and the potential investment risks and opportunities he sees.
Components of the CPI: August 2021
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.
Raise the Debt Ceiling, Republicans. You’ll Be Glad You Did.: Michael R. Strain
It’s unfortunate but true: Influential Republican politicians are playing another round of political chicken that could easily lead to a damaging brush with default on the national debt.
Weekly Gasoline Prices: Up 41% This Year
As of September 13, the price of Regular and Premium was down a penny each from the previous week. According to GasBuddy.com, California has the highest average price for Regular at $4.38 and Mississippi has the cheapest at $2.78. The WTIC end-of-day spot price closed at 70.45, up 3.1% from last week and up 48% from the beginning of the year.
NFIB Small Business Survey: "Small Business Optimism Increased Slightly in August"
The headline number for August came in at 100.1, up 0.4 from the previous month. The index is at the 57th percentile in this series.
Minisode - A New Data Platform for Data on Alternatives
The volatility caused by the pandemic has driven greater interest in alternatives to diversify portfolios and preserve wealth. It is part of a shift from passive to active management. However, getting information on these alternative assets has been disjointed. My guest, Mark Salameh, created AltsAxis to fill a major gap by becoming that one place allocators can access a wide range of dynamic, comprehensive, and objective data that they can use to make a well-informed alternative investment decision.
Reducing Downside Risk through Multi-Indicator Trend-Following Strategies
Applying a relatively single-indicator trend-following strategy is an excellent way to obtain meaningful exposure to the overall market with significantly lower downside risk and higher long-term risk-adjusted returns.
Weekly Investment Strategy
In addition to football, this fall will be eventful for our team of monetary policymakers at the Federal Reserve. Quarterbacked by Chairman Powell, the Fed will draft its route to easing its accommodative stance now that the economic recovery has put some points on the scoreboard.
Fundamentals of RAE: Deep Value, Bubble Stocks, and Market Inefficiency
Value has its day in the sun. But are investors learning the right lessons from it?
5 Divergences in the Stock Market to Keep an Eye on this Fall
With the S&P 500 up nearly 20% and international developed stocks up 13% year-to-date, the markets are having a banner year so far.
Monthly Market Risk Update: September 2021
U.S. equity markets continued to rally in August, with all three major indices setting new record highs during the month. We did see some midmonth volatility, but the Dow Jones Industrial Average gained 1.50 percent, while the S&P 500 experienced a 3.04 percent gain.
The Suckers at the Investment Table
New research confirms that institutional investors, such as mutual funds, outperform the market before fees, and they do so at the expense of retail investors. That is bad news for retail investors and for investors in active mutual funds, who underperform after fees.
Total Return Perspectives: August 2021
U.S. Treasuries ended their 4-month streak of positive returns and falling yields in August. Intermediate maturity yields rose more than shorter and longer maturities, as the market began to see through the impact of the Delta variant and focus more on the Federal Reserve’s plan to scale back their bond buying program.
Fixed Income Market Update
Markets now know that the taper can be divorced from interest rate hikes. But for how long? What are your expectations on the timing of tapering?
Market Cap to GDP: August Buffett Valuation Indicator
With the Q2 GDP Second Estimate and the August close data, we now have an updated look at the popular "Buffett Indicator" -- the ratio of corporate equities to GDP. The current reading is 214.2%, up from 204.7% the previous quarter.
U.S. Workforce: August 2021 Update
We've updated our monthly workforce analysis to include the latest Employment Report for August. The unemployment rate dropped to 5.2%, and the number of new nonfarm jobs (a relatively volatile number subject to extensive revisions) came in at 235K.
The Latest Look at the Total Return Roller Coaster
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 $20,758 for an annualized real return of 14.5%.
Job Openings & Labor Turnover: July 2021 Update
The latest JOLTS report (Job Openings and Labor Turnover Summary), with data through July, is now available.
Retiring Soon? Sold Your Home? Now Go Buy Some Stocks: Alexis Leondis
The real estate market may be cooling slightly, but those who have sold their homes recently or plan to will still be reaping big gains from Westchester, New York, to Oakland, California.
Flexible Fixed Income: How to Navigate the Challenges of 2021 and Beyond
Uncertainty always exists in financial markets.
Treasury Yields: A Long-Term Perspective
As of August 31, 2021, the 10-year note was 78 basis points above its historic closing low of 0.52%, reached on August 4, 2020
Full-time and Part-time Employment: A Deeper Look
Let's take a closer look at Friday's employment report numbers on Full and Part-Time Employment.
SPACs: What Are They, and Are They a Risk to the Market?
Special purpose acquisition companies (SPACs)—also known as blank-check companies—have gained immense popularity among investors since the beginning of 2020, despite being around for decades.
A New Fund Targets Higher Yield with Less Credit and Duration Risk
The First Eagle Credit Opportunities Fund (FECRX) takes an intensive, research-driven approach to income-oriented opportunities available across the alternative credit spectrum—including both private and public investments—in an effort to deliver current income while providing long-term risk-adjusted returns through a focus on senior-secured assets. I spoke with its managers, Andrew Park and Christian Champ.
AP Thought Leader Summit Session Summaries
On August 24 and 25, we held our second annual Thought Leader Summit. Here is a short summary of each session and a link to watch the replay for CE credits.
The Big Four Economic Indicators: August Employment
This commentary has been updated to include Friday morning's release of Nonfarm Employment. August's 235K increase in total nonfarm payrolls had revisions that resulted in 134K more jobs than previously reported. The Investing.com consensus was for 665K jobs gained and the unemployment rate to fall to 5.2%.
Dalio’s Hedge Fund Risks Being Dumped by Pension on Weak Returns
A California county’s $21 billion pension is considering whether to drop Ray Dalio’s hedge fund after it underperformed for most of the past 16 years.
China vs. Brazil
Investors are increasingly looking outside developed countries for investment opportunities, but it’s important to remember that not all Emerging Market countries are the same. In this report, we compare the opportunities in China & Brazil.
China’s Regulatory Announcements Part III
Q&A with Kathlyn Collins: Understanding the context of the recent regulatory announcements through an ESG lens.
S&P 500 Dispels “Sell in May” Myth With Strong Summer Gains
As of the end of August, the index's year-to-date gains exceed 20%.
Legendary Investor Mark Mobius Endorses the 10% Golden Rule
Mark Mobius, the legendary emerging markets investor, says that 10% of investors’ portfolios should be in gold in anticipation of currency devaluation as a result of unprecedented stimulus measures.
July Trade Deficit at $70.1B
The U.S. International Trade in Goods and Services, also known as the FT-900, is published monthly by the Bureau of Economic Analysis with data going back to 199 and details U.S. exports and imports of goods and services. Today's headline number of -70.05B was better than the -71.00B Investing.com forecast.
Looking at Yields in High-Yield Credit
A properly diversified credit portfolio should have exposure to both high-yield corporate bonds and bank loans.
August Markit Manufacturing: "Improvement in Operating Conditions"
The August US Manufacturing Purchasing Managers' Index conducted by Markit came in at 61.1, down from the final July figure. Markit's Manufacturing PMI is a diffusion index: A reading above 50 indicates expansion in the sector; below 50 indicates contraction.
A Dizzying Summer in D.C. as U.S. Debt Ceiling Looms Again
A busy summer on the fiscal front in Washington that’s seen progress on budget and infrastructure legislation could soon give way to another showdown over the U.S. statutory debt ceiling, potentially signaling volatility for investors in the months ahead.
Consumer Confidence Fell in August
The headline number of 113.8 was a decrease of 11.3 from the final reading of 125.1 for July. This was below the Investing.com consensus of 124.0.
Immunizing Your Mind and Portfolio
What if it were possible to immunize yourself from market volatility? Thankfully, it doesn’t require a vaccination.
ESG Mutual Funds Have Underperformed – But Just Barely
New research shows that the ESG portions of mutual funds underperformed the remainder of the funds and did so with higher risk. But the magnitude of those differences was small.
All Asset All Access: Evaluating and Managing Long‑Term Inflation Risks
In this edition, Chris Brightman, chief executive officer and chief investment officer of Research Affiliates, explains their outlook on long-term inflation and discusses how investors can prepare for this risk.
Real Disposable Income Per Capita Inches Up in July
With the release of this morning's report on July's Personal Incomes and Outlays, we can now take a closer look at "Real" Disposable Personal Income Per Capita. At two decimal places, the nominal 1.08% month-over-month change in disposable income is cut to 0.66% when we adjust for inflation. This is an increase from last month's 0.03% nominal and 0.56% real decreases. The year-over-year metrics are 0.13% nominal and -3.89% real.
The Big Four: Real Personal Income in July
Personal Income (excluding Transfer Receipts) in July rose 0.7% and is up 8.2% year-over-year. However, when adjusted for inflation using the BEA's PCE Price Index, Real Personal Income (excluding Transfer Receipts) MoM was up 0.23%. The real number is up 3.8% year-over-year.
Blockbuster Gains Have Public Pensions Dialing Back Projections
One of the most worrisome risks for state and local governments just got a little more manageable.
P Is For Aligning Products To Meet Each Client’s Unique Goals, Circumstances And Preferences
P is for aligning products to meet each client’s unique goals, circumstances and preferences.
Minisode - The Future for Options-Based Strategies
The big story in the ETF industry over the last several years has been the growth of options-based strategies. Those products have accumulated assets at a rapid pace. They are offering advisors and their clients low-cost solutions that have return profiles, including downside protection and upside participation, that are not available in conventional strategies.
Being Vested in Your Investing
During a trying time for the world in 1939, Winston Churchill famously described the largest country in the world and soon-to-be second superpower, the Soviet Union, as “a riddle wrapped in a mystery inside an enigma.”
You Take My Breadth Away: Market’s Underlying Deterioration
The stock market could use some mouthwash.
Treasury Yields Seen Inching Up Even With Balanced Fed Message
Signs are growing that U.S. Treasury yields may continue to march higher even if Federal Reserve Chair Jerome Powell strikes a balanced tone at Jackson Hole this week.
The "Real" Goods on the July Durable Goods Data
The Census Bureau has posted the Advance Report on Durable Goods New Orders. This series dates from 1992 and is not adjusted for either population growth or inflation. Let's now review Durable Goods data with two adjustments.
How SMAs and Interval Funds Can Help Meet Municipal Investor Needs
There are many potential advantages to investing in tax-exempt municipal bonds, but not all advisors are aware of additional strategies and investment vehicles that can help them meet muni-focused client needs.
2021 Survey of the Top 50 Hedge Funds
For the third year in a row, the top 50 hedge fund managers, relying on a variety of strategies, generated net returns comparable to the S&P 500 with significantly less risk and performance that was largely independent of the market. Hedged equity, multistrategy, and global macro funds led the way with more than half the funds in the top 50 managing less than $1 billion.
On My Mind: Leaving QE, Never Easy
This year’s annual economic policy symposium in Jackson Hole opens the six months that will likely define the legacy of the Powell Fed’s first term.
Headline Durable Goods Orders Slip 0.1% in July
The latest new orders number at -0.1% month-over-month (MoM) was better than the Investing.com -0.3% estimate. The series is up 17.6% year-over-year (YoY). If we exclude transportation, "core" durable goods was up 0.7% MoM, which was above the Investing.com consensus of 0.5%. The core measure is up 16.7% YoY.
Gundlach: Inflation Will be Above 5% for 2021
There is at least a 50/50 chance that headline CPI inflation will exceed 5% for all of 2021, according to Jeffrey Gundlach.
A Major Investment Firm is Losing Its Battle Against Fraud Claims
For a long time, it worked. Wealthy investors did, in fact, enhance their yield through the firm’s YES strategy – and they were hooked. But then the market crashed, and the honeymoon was over.
Stock Market Is as Active as Before $11 Trillion Index Invasion
Wall Street’s passive revolution is turning out to be anything but, with active investing alive and kicking in even the sleepiest corners of the ETF world, according to the latest research.
Lunar Tides, the VIX and Volatility
This article explains how the VIX® Index and volatility revert to the mean and why a variance risk premium occurs.
Time to Sell the Filing Cabinet – Digitalisation is Here
The filing cabinet gave offices a sense of control and granular access by making information visually identifiable. The pandemic and working from home proved how this way of sourcing, accessing, and presenting information is no longer viable.
Investing in a World with No Risk-Free Asset
We provide a practical definition of the ideal personalized risk-free asset, and then we’ll discuss how to construct an efficient portfolio when that ideal asset doesn’t exist in investable form.
Chicago Fed: "Index points to a pickup in economic growth in July"
Led by improvements in production-related indicators, the Chicago Fed National Activity Index (CFNAI) increased to +0.53 in July from –0.01 in June. Three of the four broad categories of indicators used to construct the index made positive contributions in July, and three categories improved from June. The index’s three-month moving average, CFNAI-MA3, moved up to +0.23 in July from +0.01 in June.
The Traditional Approach to International Diversification is Losing Its Relevance
The predominant approach to classifying securities geographically is based on domicile, the legal home of a company. But that approach is losing its relevance. Investors should consider foreign revenue to understand the international risks of investments and portfolios.
ESG Funds Have Strong Factor Exposures
New research shows that funds that with an ESG mandate have factor exposures that differ significantly from the market, creating a challenge for investors who seek a specific factor loading for their overall allocations.
China Inc.: Understanding Risk in China’s Credit Markets
Much of the volatility that has recently shaken China’s credit markets has been associated with government interventions.
Did The Fed’s Monetary Policy Experiment Just Fail?
Did the Fed’s “monetary policy experiment” fail?
Don’t Fall for FUD: Fear, Uncertainty and Doubt
So many headlines right now are instilling FUD in investors’ minds, which stands for Fear, Uncertainty and Doubt—from the Afghanistan news to fears on cryptocurrency and the delta variant disrupting travel plans. But don’t fall for it.
10 Takeaways from My Chat with Michael Saylor
Many of you tuned in this week to watch the conversation between me and Michael Saylor, founder and CEO of business intelligence company MicroStrategy.
When Is The Next Bear Market? 3-Things Will Tell You
The question I get most often is “when is the next bear market?” There are three specific items that tend to predict bear markets and recessions with some accuracy.
Delta Impact on Consumer Behavior Will Delay Tapering Announcement
The resurgent virus should keep a lid on Treasury Yields.
Meh Economy? Americans Aren’t Sure What to Make of the Recovery
If there’s a single word that captures how Americans feel about their economy as the second pandemic summer draws to a close, it could conceivably be: “meh.”
New Residential Housing Starts Down 7% in July
The U.S. Census Bureau and the Department of Housing and Urban Development have now published their findings for July new residential housing starts. The latest reading of 1.534M was below the Investing.com forecast of 1.600M and a 7.0% decrease from the previous month's 1.650M.
New Residential Building Permits: Up 2.6% in July
The U.S. Census Bureau and the Department of Housing and Urban Development have now published their findings for July new residential building permits. The latest reading of 1.635M was up 2.57% from the June reading and is above the Investing.com forecast of 1.610M.
6 Great Ways To Hedge Your Portfolio From The Pending Market Crash
Hedging your portfolio from the pending market crash.
The Role of Confidence in Growing Your Practice
The pursuit of growth requires the belief that it’s possible, which is another way of saying you need confidence.
Weekly Investment Strategy
Review the latest Weekly Headings by CIO Larry Adam.
Optimizing International Allocations with Asia
Going forward, we believe that the traditional international allocation and global emerging markets deserves a rethink.
Style Boxes are Meaningless – Cash Flows are What Matters in Retirement Planning
Style boxes and other constructs of the investment industry are meaningless when it comes to portfolio theory, according to financial economist John Cochrane. Instead, investors should focus on cash flows and market equilibrium.
How the Crypto and Meme Bubbles Threaten Ordinary Investors
The next market correction will inflict its worst damage on crypto and meme investors, but those saving for retirement in a diversified, disciplined manner will suffer alongside them.
Quick Thoughts: China’s New Regulatory Cycle
China is in the midst of a tightening regulatory cycle which has led to some investor uncertainty and heightened market volatility.