ETF Philosophy

Sep 19

1

Stocks? Throw The Book At Them!

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

Net worth used to be a simple concept. Add up assets. Subtract liabilities. And celebrate (or mourn) the tangible book value of the company. It is not so simple anymore. In a service-oriented economy, the value of a corporation partially depends on several intangibles. How influential is the company’s brand? What about the impact of the personality of one or two key individuals? Nevertheless, the increasing importance of intangibles should not diminish the relevance of tangible net worth. Tangible book…

Sep 05

1

Are Investors In U.S. Stocks Turning A Blind Eye To Contagion Risks Abroad?

By Gary Gordon | Asia ETFs, China ETFs, Consumer ETFs, Current Affairs and ETFs, Emerging Market ETFs, ETF Philosophy, ETF Strategy, Europe ETFs, Frontier Market ETFs, Global ETFs, Popular Posts, Special Sectors ETFs, US Markets and ETFs | No Comments

Things look pretty darn good for the U.S. economy. Unemployment rates are low, inflation-adjusted borrowing costs are practically zero, and corporate profit margins sit at record highs. U.S. consumers have taken notice. The recently released Conference Board reading for consumer confidence reached 133.4. We have not seen a data point like that since the year 2000. Ironically enough, an exceptionally happy consumer is rarely beneficial for the investment markets. Take a look at the forward returns for the S&P 500…

Aug 29

1

When Will S&P 500 Valuations Matter Again?

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

In the private markets, buyers and sellers care a great deal about valuation. For example, a financial advisory practice might fetch between 1 percent and 2 percent of assets under management. Or it might go for 2.3 times trailing 12 months’ gross revenues. Higher or lower valuations depend largely on things like key personnel, average account size, client retention, economies of scale and the growth rate. The critical importance of valuation also comes to light on the popular television show,…

Aug 22

1

Should You Celebrate or ‘Fade’ The Longest Bull Market In History?

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

The mainstream financial media love to tell you, “Bull markets don’t die of old age.” True enough. Indeed, the current uptrend remains a shining example of cyclical durability and persistence. For many, then, the fact that the stock bull has set an all-time record in length is cause for celebration. 3,453 days and counting. If you choose to listen, Kool & The Gang will even let you know where the party is at. It is worth noting that the S&P 500 needs to…

Aug 13

1

3 Reasons Stocks Are Straining To Get Over the Hump

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

The S&P 500 – a broad market barometer for U.S. stocks – last hit a record high six-and-a-half months ago. Why has the stock market failed to close above its previous peak set back on January 26? The short answer is that not everyone is buying the media-hyped “Goldilocks” scenario. Granted, the country is enjoying the near-term benefits associated with tax cut stimulus and relatively low interest rates. Employment trends have been favorable. Consumers are willingly spending both the money…

Jul 31

1

What The Real Estate Cycle May Tell Us About Stocks

By Gary Gordon | Consumer ETFs, Current Affairs and ETFs, ETF Philosophy, ETF Strategy, Large Cap ETFs, Real Estate ETFs, Special Sectors ETFs, US Markets and ETFs | No Comments

According to the National Association of Realtors, existing home sales have declined for three consecutive months. Similarly, the year-over-year data have been negative in every month except for February. Existing home sales are hardly the only weak spot in real estate. Sales of new homes fell 5.3% in June. Meanwhile, the Mortgage Bankers Association reported that purchase applications dropped 5% and overall application volume decreased 2.5% (through the week ending July 13). There’s more. Housing permits shrank on a year-over-year…

Jul 25

1

Corporations Set Records For Buybacks As Their Insiders Sell

By Gary Gordon | Current Affairs and ETFs, ETF Philosophy, ETF Strategy, Large Cap ETFs, Mid Cap ETFs, Popular Posts, Small Cap ETFs, Special Sectors ETFs, Technology ETFs, Telecom ETFs, US Markets and ETFs | No Comments

Tax-cut infused earnings have been solid. The rapid-fire rise of longer-term borrowing costs has slowed considerably. And corporate share buybacks have dwarfed earlier records. In Q2 alone, corporations purchased a staggering $436.6 billion in stock buybacks. That brings the year-to-date total to $670 billion. Similarly, announced S&P 500 buybacks are practically leaping off of the chart. More than most factors influencing market direction, buybacks have kept large-cap stocks from succumbing to legitimate concerns about Federal Reserve policy error, China trade…

Jul 19

1

Stuck Between A Rock, A Boulder And A Hard Place

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

If the Federal Reserve raises the federal funds rate much further, it risks triggering a recession. That’s not my opinion; rather, it is the opinion of Neel Kashkari, president of the Federal Reserve Bank of Minneapolis. Kashkari’s thesis? When shorter-term rates rise above longer-term ones – a phenomenon known as yield curve inversion – the financial markets are anticipating an economic slowdown in the near future. Additionally, Kashkari does not care why longer-term Treasury yields are flat or falling (e.g.,…

Jul 11

1

The Yield Curve and Stocks: Much Ado About Everything

By Gary Gordon | Current Affairs and ETFs, Dividend ETFs, ETF Philosophy, Large Cap ETFs, Popular Posts, Small Cap ETFs, Special Sectors ETFs, Technology ETFs, US Markets and ETFs | No Comments

There has been a great deal of chatter about the strength of the American job market. And with good reason. Most measures of employment health – U-2 unemployment rate, jobless claims, wage increases, year-over-year job growth, etc. – support the notion that U.S. workers are “winning.” On the other hand, very few folks have addressed the possibility that the data are more likely to weaken than strengthen. On the contrary. So much faith is being placed on tax cut stimulus…

Jul 05

1

Can A Stock Bull Prevail Without the Financial Sector?

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

“The most important item over time in valuation is obviously interest rates,” Warren Buffett explained in 2017. Never mind that this appears to contradict his beliefs back in 2001. Sixteen years earlier, Mr. Buffett stated that stock market-capitalization-to-GDP was “the best single measure of where valuations stand at any given moment.” On this indicator, then, stocks have rarely been as over-priced as they are right now. It is certainly possible that the financial crisis of 2008 fundamentally altered the investment…