Time in the Market, Not Timing the Market? Catchy Phrase Ignores Key Evidence

By | Bond ETFs, Consumer ETFs, Current Affairs and ETFs, Dividend ETFs, ETF Philosophy, ETF Strategy, Large Cap ETFs, Special Sectors ETFs, US Markets and ETFs | No Comments

There is a reason why Warren Buffett regarded market-cap-to-GDP as “…the best single measure of where valuations stand at any given moment.” The reason? Its relationship with 10-year forward returns for stock prices. And right now, stock market capitalization as it relates to the U.S. economy is projecting negative returns for U.S. stock prices. It is also true that Mr. Buffett has, in recent years, distanced himself from the valuation approach called the “Buffett Indicator.” Is it because he stopped believing…

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How Much Longer Should Stock Investors Dance Near The Fire Pit?

By | Bond ETFs, Current Affairs and ETFs, ETF Philosophy, ETF Strategy, Large Cap ETFs, Popular Posts, Special Sectors ETFs | No Comments

American consumers are financially strained. One indication? Card defaults rose from 2.81% back in November to 3.53% in May. Meanwhile, the expansion of credit by cards as well as by autos has slowed to the point of contraction. Some would have you believe that low headline unemployment (4.4%) is translating into increased consumption and increased demand for goods or services. Yet tepid GDP data demonstrate otherwise. One explanation is that nominal wage growth would need to grow in the 3.5%-4.0%…

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Think The Fed Will Have Your Back Forever? Think Again

By | Bond ETFs, Current Affairs and ETFs, ETF Philosophy, ETF Strategy, Leveraged ETFs, Special Sectors ETFs | No Comments

I have a confession to make: I love confessions. I spent countless hours in the late 1990s listening to sports radio dissect Mark McGuire’s acknowledgement of steroid use. And who did not get chills reading Perry Smith’s account of the Clutter family murders in Capote’s In Cold Blood? However, the admission of transgression that captivated me the most over the last decade did not receive the kind of attention it likely deserved. Richard Fisher corroborated (January, 2016) that the Federal Reserve front-loaded…

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Are Stocks Adequately Compensating You For The Risk Of Financial Loss?

By | Bond ETFs, Current Affairs and ETFs, ETF Philosophy, ETF Strategy, Large Cap ETFs, Popular Posts, Special Sectors ETFs, US Markets and ETFs | No Comments

Few predict that a recession is imminent. On the flip side, how should one reconcile the fact that the treasury yield curve is flatter than it has been since 2007? A diminishing spread between 30s and 2s has a history of alerting market watchers to economic difficulties. At the start of the current recovery in June of 2009, the spread between the longest-term maturities and shorter-term maturities clocked in at a relatively robust 3.5%. The yield curve was noticeably steep. Eight years later? The…

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This Stock Market Bull Does Not Believe In ‘Peak Stimulus’

By | Biotechnology ETFs, Bond ETFs, China ETFs, Currency ETFs, Current Affairs and ETFs, Emerging Market ETFs, ETF Philosophy, ETF Strategy, Global ETFs, International ETFs, Large Cap ETFs, Small Cap ETFs, Special Sectors ETFs, Technology ETFs, US Markets and ETFs | No Comments

When central banks create money to underwrite a worldwide credit boom, do people become prosperous? Or does the electronic money creation encourage excessive borrowing that steals from future well-being? Consider the $10.75-plus trillion that central banks created in response to the U.S. financial crisis of 2008 and the subsequent economic stagnation across the globe. Monetary policy authorities primarily acquired “IOU” assets (e.g., sovereign debt, corporate bonds, etc.) to depress interest rates. The ultra-low rates stimulated unbridled borrowing from the financial system by…

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