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ETF Philosophy

Why You Will Lose Your Lovin’ Feeling For Central Banks

By | Bond ETFs, Current Affairs and ETFs, Emerging Market ETFs, ETF Philosophy, Global ETFs, Popular Posts, Real Estate ETFs, Special Sectors ETFs, US Markets and ETFs | No Comments

Central banks across the globe have acquired $1.5 trillion in assets through the first five months of 2017. The monthly amount ($300 billion) has found its way into virtually every cranny and nook of the financial system. U.S. stocks, European stocks, emerging market equities, higher yielding junk bonds, convertibles, preferred shares, real estate investment trusts, real estate – you name it. Values have continued to climb in spite of inadequate economic growth. When a central bank buys assets with electronically printed…

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Why Doesn’t The Bond Market Believe The Stock Market?

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

The S&P 500 struggled to gain price traction between the tail end of 2014 and the beginning of November in 2016. For many folks, the period represented 22 taxing months of uncertainty. Then came Trump. Suddenly, the investing community began soaking up the potential that corporate tax cuts, infrastructure spending and regulatory reform might revive a slow-growing economy. U.S. stocks rocketed to set records. In contrast, bond prices plummeted, as yields for the safer haven securities soared. Since the beginning…

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The Euphoria Debate: U.S. Stocks Versus U.S. Real Estate

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

When an asset class (e.g., stocks, bonds, commodities, real estate, collectibles, etc.) skyrockets in price – when it surges higher without sufficient economic reason – a bubble develops. Technology stocks in the late 1990s. Housing in the mid-2000s. When the asset class inevitably nose-dives? The balloon implodes. Speculative silliness has not been difficult for me to spot. As a national talk radio personality in the late 1990s, I warned stock investors not to get carried away by dot-com madness. A “New…

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Don’t Blame Minsky If Your Portfolio Value Crumbles

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

Remember when the financial markets believed that tax cuts, regulatory reform and infrastructure spending would rev up the economic growth engine? The dollar surged. Bonds cratered. And stocks broke out of a 22-month collective funk. Yet expectations that a “business-friendly” Trump will offset higher borrowing costs have faded considerably. Consider the flattening of the yield curve. The spread between shorter term 2-year Treasury yields and longer-term 10-year Treasury yields is back below a scant 1 percentage point. This is more indicative…

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Buy U.S. Stocks Today? Graham Thinks You’re Nuts

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

Would Warren Buffett’s mentor buy domestic stocks today? Probably not. The father of value investing, Benjamin Graham, would have trouble recommending a single U.S. company’s shares across thousands of possibilities. Need proof? In the fourteenth chapter of The Intelligent Investor, a classic that Mr. Buffett regarded as “…the best book on investing ever written,” Graham offered a seven-step test for stock selection. The criteria include: (1) adequate size with respect to revenue, (2) strong financial condition with respect to liquidity, (3) reasonable…

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It’s A Large-Cap Tech World After All

By | Bond ETFs, Consumer ETFs, Current Affairs and ETFs, Dividend ETFs, ETF Philosophy, ETF Strategy, Large Cap ETFs, Mid Cap ETFs, Small Cap ETFs, Special Sectors ETFs, Technology ETFs, US Markets and ETFs | One Comment

Apple, Microsoft, Amazon, Facebook and Google (now Alphabet) account for roughly 13% of the S&P 500 SPDR Trust’s (SPY) price movement. The same 5 corporations? 42% of the NASDAQ 100’s (QQQ) price appreciation. The super-sized weighting of prominent tech companies in these benchmark ETFs has resulted in year-to-date gains of 7.1% and 16.6% respectively. Yet the rest of the market’s performance has been flat. Barely positive, in fact. Not sure? Take a look at the performance of small-cap and value-oriented…

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Amazon (AMZN): Love the Company, Hate The Stock Price

By | Current Affairs and ETFs, ETF Philosophy, ETF Strategy, Large Cap ETFs, Popular Posts, Special Sectors ETFs, US Markets and ETFs | One Comment

I recently ate dinner with a high-net-worth sales executive who asked me, “What are your thoughts on Amazon?” I told him the truth. Excellent company… unusually vulnerable stock. I explained my thesis on debt levels, excessive financial leverage, bubbly market euphoria, over-valuation as well as forced liquidation via margin calls. He seemed surprised that I might be concerned. He stated confidently, “Jeff Bezos is a one-of-a-kind innovator and Amazon is the future of retail. The stock should do very well…

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Extreme Leverage? Extreme Valuations? Big Time Short Sellers Must Be Thinking About It

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

There is an eight foot broadleaf evergreen directly outside my office door. Normally, I would not give it a second’s glance. Recently, however, a hummingbird has been buzzing about the greenery. And with good reason. Two hatchlings have arrived, requiring food as well as warmth. In spite of my presence, the mother has been expressing an unusual amount of audacity. She does not flinch when I walk near the nest. And when she’s out gathering insects to feed her young, she…

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Bull? Bear? The U.S. Stock Market Is More Like The Honey Badger

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

Voters in the United Kingdom shockingly decided to leave the European Union? The stock market barely blinked. Voters in the United States unexpectedly elected a brash promoter over a well-established political insider? The stock market didn’t care. It told the media elite to take a hike, then promptly climbed to higher ground. The S&P 500 really doesn’t care what you think. It takes what it wants when it wants. The Federal Reserve continues to raise overnight lending rates? The yield…

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Did Stock Guru Jim Cramer Learn Anything From 2000 And 2008?

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

Borrowing money to get something that a person wants today can be financially rewarding. For example, mortgage debt helps a borrower acquire a home that is likely to appreciate in value over time. Not only does one enjoy the use of the property, one often increases his/her net worth through the use of leverage. A problem might develop, however, if an individual or family struggles to make the monthly payment. Job loss, sickness, ill-advised spending habits – a lendee might…

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