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Bond ETFs

If You Bought The Tax Reform Rumors, Will You Be Selling The Tax Cut News?

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

Since the Great Recession, each time that the U.S. economy bogged down, the U.S. Federal Reserve began printing additional electronic dollar credits to acquire billions in assets (a.k.a. “quantitative easing” or “QE”). And the efforts were primarily responsible for pushing interest rates lower, as well as stock and real estate prices higher. Take a look at the blue line in the chart below. It represents the electronic money printing activity of central banks across the world. Not only did stocks surge ahead…

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Managing Assets When Markets Become Irrationally Effervescent

By | Bond ETFs, Current Affairs and ETFs, ETF Philosophy, ETF Strategy, Special Sectors ETFs, Technology ETFs, US Markets and ETFs | No Comments

When I co-hosted a national talk radio show in 2000, tech stock inquiries came furious and fast. JDSU or Sun Micro? Powerwave or Cisco? Webvan or theGlobe.com? Few expressed concern about a recession. Few wondered if they might lose money by investing in the New Economy’s Internet favorites. Even fewer callers believed that they might want to take less risk rather than more. Granted, tech stocks may not be as wildly overvalued as they were in 2000. That said, the U.S….

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Don’t Put All Of Your Eggs In The ‘Tax Cuts Are Coming’ Basket

By | Bond ETFs, Commodity ETFs, Current Affairs and ETFs, ETF Philosophy, ETF Strategy, Large Cap ETFs, Short ETFs, Special Sectors ETFs, Technology ETFs, US Markets and ETFs | No Comments

It does not matter what you call it or how you explain it. The Trump trade. A tax reform rally. Heck, you can attribute the longest uptrend in history without a 3% pullback to global quantitative easing (QE). It makes very little difference. Stocks have been stupendous. Does a record number of trading days without a 3% correction mean anything? Not in isolation. The second-longest streak occurred between January 1995 and January 1996. And yet, back then, the phenomenal ’90s…

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If Familiarity Breeds Contempt, What Do Debt And Complacency Breed?

By | Bond ETFs, Currency ETFs, Current Affairs and ETFs, ETF Philosophy, ETF Strategy, Large Cap ETFs, Small Cap ETFs, Special Sectors ETFs, Technology ETFs, US Markets and ETFs | No Comments

Back in 1999, low inflation and fabulous headline unemployment (<5%) warranted a Federal Reserve overnight lending rate of 5.0%. Today, low inflation and desirable headline unemployment (<5%) come with $3.75 trillion in electronic money credits still on the central bank’s balance sheet and a Fed Funds Rate of a mere 1.25%. That is 375 basis points lower than it was with similar economic fundamentals less than two decades ago, not to mention a whole lot of “electronic money printing” since the…

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The Years 2000 And 2017: There’s A Whole Lot Of Rhyming Going On

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

This week, CNBC’s Kelly Evans interviewed one of the most well-respected billionaire hedge fund managers in history, Julian Robertson. The co-founder of Tiger Management discussed global central bank collusion to depress interest rates and the subsequent creation of a bubble. “A bubble in the stock market?” the journalist clarified. Robertson replied, “Yes, ma’am.” Billionaires from the investing world do not sport perfect track records. Nevertheless, when the .0001% speak, investors should take notice. Within the past few months, the list of billionaire…

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Signs That Investors May Be Shying Away From Indiscriminate Risk

By | Bond ETFs, Current Affairs and ETFs, ETF Philosophy, ETF Strategy, Large Cap ETFs, Small Cap ETFs, US Markets and ETFs | No Comments

You may never have heard of Robert Rodriguez. For that matter, you probably did not know that he retired in December from California-based First Pacific Advisors (FPA). Yet he is the only mutual fund manager ever to win the Morningstar Manager of the Year award for a stock fund and for a bond fund. In a recent interview, Mr. Rodriguez revealed that he has virtually zero exposure to stocks in his personal accounts. Liquidity? More than 65% via short-term Treasury-type securities….

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Surging Corporate Profits? Not For The Rest Of This Economic Cycle

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

Are corporate earnings genuinely wonderful? It may depend on your perspective. For example, after-tax corporate profits have grown at an annualized pace of less than 1% over the last 5 years. You won’t find many 5-year periods that have been as anemic as that. In the same vein, earnings per share (EPS) growth has been equally unimpressive. Yet stock prices have been climbing with or without corporate earnings support. One could make a case that corporate profits are just now…

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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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