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International ETFs

Should Investors Take Notice When Reward Prospects Diminish?

By | Asia ETFs, Bond ETFs, Commodity ETFs, Consumer ETFs, Current Affairs and ETFs, Dividend ETFs, Emerging Market ETFs, ETF Philosophy, ETF Strategy, Europe ETFs, International ETFs, Large Cap ETFs, Special Sectors ETFs, US Markets and ETFs | No Comments

The world’s central banks devise conventional and unconventional ways to depress interest rates. The impact? Consumers purchase goods and services on credit with favorable financing terms. Corporations issue low-yielding debt in order to buy back shares of their own stock. And governments issue low-yielding treasuries to continue spending far more than they generate in tax revenue. For some investors, then, the only thing that matters in the determination of whether to acquire assets like stock and real estate is ultra-low interest…

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The S&P 500’s 788,400 Minutes: Measuring One Year-And-A-Half In The Life Of An Index

By | Asia ETFs, Bond ETFs, China ETFs, Current Affairs and ETFs, Dividend ETFs, Emerging Market ETFs, ETF Philosophy, ETF Strategy, Europe ETFs, International ETFs, Large Cap ETFs, Special Sectors ETFs, US Markets and ETFs | No Comments

There may be 525,600 minutes in a normal calendar year. However, there have been 788,400 minutes since the S&P 500 first hit 2050 in November of 2014; there have been 1,314,000 minutes since the NYSE Composite Index rose above the 10,000 level in November of 2013. In other words, lost in the narrative that “there is no alternative,” stocks have not gained significant ground in a very long time. Equally worthy of note, defensive stocks have been far more impressive than…

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Three Charts: What Debt, ‘CapEx,’ and Whole Profits Tell Stock Investors

By | Bond 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, US Markets and ETFs | No Comments

For several years now, I have expressed concern about the accumulation of debt by governments, corporations and households. Some folks seem to recognize that – across the board – total debt levels are on an unsustainable path. Others have argued that the only thing of importance is the ability to service existing obligations, and that each group is quite capable of paying back the interest on their loans. Unfortunately, the naysayers argument ignores several unpleasant realities. First, borrowers at all…

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No Sales, No Profits, No Bull: What Happens When Valuations And Central Banks Collide

By | Asia ETFs, Bond ETFs, Commodity ETFs, Consumer ETFs, Currency ETFs, Current Affairs and ETFs, Emerging Market ETFs, ETF Philosophy, ETF Strategy, Europe ETFs, International ETFs, Large Cap ETFs, Latin America ETFs, Special Sectors ETFs, US Markets and ETFs | No Comments

Total business sales – sales by wholesalers, manufacturers and retailers – have fallen 5% from their July 2014 peak of $1.365 trillion. At $1.296 trillion for January 2016, total business sales have dropped back to where they were in January of 2013 ($1.293 trillion). In fact, the erosion of total sales by American businesses are even uglier when one takes inflation into account. Over the last 20 years, whenever total business sales continued on an upward trajectory, the U.S. economy steered clear…

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Financial Stress Index Is Screaming, “Bear Market Rally”

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

What if investors had a way to determine the extent of “stress” in the financial system? And what if those stress levels could tell investors whether or not riskier assets (e.g., stocks, higher-yielding debt, etc.) can succeed without definitive U.S. Federal Reserve intervention? Consider the Cleveland Financial Stress Index (CFSI). The CFSI monitors the well-being of a wide range of financial markets, including credit, equity, foreign exchange, funding, real estate and securitization. According to the Cleveland Fed, a CFSI reading greater than…

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What Negative Interest Rates Tell You About The Risk-Reward Backdrop

By | Asia ETFs, Current Affairs and ETFs, ETF Philosophy, ETF Strategy, Global ETFs, International ETFs, US Markets and ETFs | No Comments

When a country’s central bank reduces its interests rates below zero (i.e., “goes negative”), the action should boost the relative appeal of stock assets. That is the theory. Unfortunately, recent policy initiatives by the European Central Bank (ECB) and the Bank of Japan (BOJ) have failed to inspire their respective stock markets. The ECB first began fooling around with negative interest rate policy in June of 2014 by lowering its overnight deposit rate to -0.1.% It went to -0.2% in…

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Is Unemployment Really 19%? Your Tactical Asset Allocation Should Reflect Economic Reality

By | Asia ETFs, Bond ETFs, China ETFs, Current Affairs and ETFs, ETF Philosophy, ETF Strategy, Europe ETFs, International ETFs, Large Cap ETFs, Special Sectors ETFs, Technology ETFs, US Markets and ETFs | No Comments

Several weeks ago, a comment provider ripped into me for being a left-wing nut job. What did I do to draw his ire?  I explained that the tapering of QE3 and the 0.25% rate hike bump – modest stimulus removal efforts on the surface – adversely impacted everything from currencies to commodities, sovereign credit to corporate credit, equity prices to equity valuation. Today, I am taking aim at the 4.9% – an endeavor that may spark angry comments about my right-wing…

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If Investors Get More Stimulus, Will They Take More Risk?

By | Bond ETFs, Currency ETFs, Emerging Market ETFs, ETF Philosophy, ETF Strategy, International ETFs, Large Cap ETFs, Mid Cap ETFs, Small Cap ETFs, Special Sectors ETFs, US Markets and ETFs | No Comments

The U.S. economy continues to show signs of frailty. U.S. gross domestic product (GDP) expanded at a feeble pace of just 0.7% in the 4th quarter. In the same vein, the Atlanta Fed’s GDP forecast for the first quarter of 2016 is just 1.2%. There’s more. The manufacturing segment of the economy has contracted for four consecutive months. Meanwhile, year-over-year growth for total business sales as well as retail have steadily eroded. Also, year-over-year activity for corporate spending on tangible assets…

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1704 on the S&P 500 in 2016? Less Far-Fetched Than Investors Want To Believe

By | Asia ETFs, Bond ETFs, China ETFs, Commodity ETFs, Consumer ETFs, Current Affairs and ETFs, Emerging Market ETFs, ETF Philosophy, ETF Strategy, Europe ETFs, International ETFs, Special Sectors ETFs, US Markets and ETFs | No Comments

How does a favorable bullish uptrend become an unfavorable bearish downtrend? Does the transition happen overnight? Do commentators, analysts, money managers and market participants simultaneously concur that the environment for risk-taking is exceptionally poor? The transition from “good times” to “bad times” is far more gradual than many realize. Granted, prices on the Dow or the S&P 500 may fall apart in a matter of days, changing the narrative from “no reason to worry” to “don’t panic.” That said, there…

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Profit Shortage + Economic Weakness + Stimulus Removal = Less Risk Taking

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

Healthy bull market uptrends tend to feature similar risk-taking characteristics. Specifically, market-based participants will invest in a wide range of stock sectors (e.g., industrials, telecom, health care, energy, etc.) and asset types (e.g., large, small, foreign, preferreds, REITs, high yield corporate, convertibles, cross-over corporate bonds, etc.). There is little reason to discriminate because across-the-board risk leads to impressive returns. Late-stage bull markets are different. Fewer and fewer individual stocks succeed; fewer and fewer asset types gain ground. There is more…

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