Category

Popular Posts

Here Comes The Fun (And The Fed Says, “It’s Alright”)

By | Consumer ETFs, Currency ETFs, ETF Philosophy, ETF Strategy, Global ETFs, Large Cap ETFs, Popular Posts, Real Estate ETFs, US Markets and ETFs | No Comments

One might define absurdity as the quality or state of being ridiculous. Or one can glance at the global quantity of negative-yielding debt. The total? Nearly $14 trillion. Holding a bond to maturity that pays a negative return is insane. Wouldn’t risk-averse folks prefer a 0% return that would come with the embrace of physical cash? Unfortunately, central banks do crazy things. The euro deposit rate is at -0.4%. That means savers and investors could lose more money at a…

Read More

How Will You Keep the Stock Wealth That You Created?

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

Bond yields have been collapsing clear across the world. And if history is any guide, the rapid decline is a function of undeniable economic weakness. Consider the correlation between bond yields and time-tested measures like the Institute for Supply Management’s PMI. The 10-year U.S. Treasury yield tends to follow in the indicator’s footsteps. As the chart shows, waning economic growth and falling bond yields occurred in 2012 and 2016. During those periods, corporate earnings struggled immensely. What about today? Not…

Read More

What The Bond Market And Real Estate Market Are Telling Investors

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

Trade wars. Tariffs. Trump. One might think that the “Ts” are solely responsible for financial market volatility. In truth, a wider variety of cross-currents are at work. Some have been bubbling up for a number of years. Consider the debt profiles of investment grade corporations. Cash on the books relative to debt has deteriorated markedly, while gross leverage (debt-to-earnings) is sitting near an all-time peak. The trend for interest coverage is equally concerning. In 2015, roughly 8.3% of corporate income went toward…

Read More

All-Time Stock Highs: Why Modest Risk-Renting Will Outshine Extreme Risk-Taking

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

There has been a great deal of media hype surrounding new all-time highs in the U.S. stock market. For that matter, there has been a fair amount of puffery when it comes to how well stocks are performing overall. In actuality, we have seen similar levels for the S&P 500 twice before. The S&P 500 traded around the 2925 level in September of 2018 and the 2875 level back in January of 2018. The last 16 months, then, have not…

Read More

Why Do Bond Investors Doubt The Stock Market Recovery?

By | Bond ETFs, Consumer ETFs, Current Affairs and ETFs, ETF Philosophy, ETF Strategy, Financial ETFs, Global ETFs, Health ETFs, Popular Posts, Special Sectors ETFs, US Markets and ETFs, Utilities ETFs | No Comments

Is a recession in the U.S. around the bend? Few economists are predicting one. On the other hand, longer-term Treasury bond yields continue to slide below shorter-term maturities. Bond investors are gobbling up long-term government debt because they believe that the economy will slow dramatically. Normally, the longer an investor allows the U.S. government to keep capital, the more that an investor would expect in annual interest from Uncle Sam. That is what transpires in a healthy economy. This past…

Read More

Will The ‘Fed Put’ Work On The Next Go-Around?

By | Current Affairs and ETFs, Dividend ETFs, ETF Strategy, Large Cap ETFs, Popular Posts, Real Estate ETFs, Special Sectors ETFs, US Markets and ETFs | No Comments

The Federal Reserve’s “180-degree turn” has worked swimmingly for borrowers and risk-takers alike. The 10-year yield has dropped from 3.24% to 2.62%. That may encourage households and businesses to lever up with more debt. Meanwhile, stocks are surging upward, reaching for the record heights experienced during the September-October peak. The question investors need to ask themselves now is, “Will the ‘Fed Put’ work on the next go-around? It depends. And it likely depends on whether or not the U.S. is…

Read More

Will The Fed’s Capitulation Come Back To Sack Investor Portfolios?

By | Current Affairs and ETFs, Emerging Market ETFs, Global ETFs, Large Cap ETFs, Popular Posts, Special Sectors ETFs, US Markets and ETFs | No Comments

In December of 2007, I offered readers insight into a predictive model for recessions. Shortly thereafter, in the first week of January (2008), Investor’s Business Daily highlighted my five-point model and its 80% probability of economic contraction. One of the key components of the model is whether or not the future expectations of consumers are falling faster than how they feel about the present economic circumstances. The Conference Board’s Present Situation Index – an assessment of current business and labor…

Read More

Gundlach Is Right About Junk Bonds And Stocks

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

Stock enthusiasts think the worst is behind us. Of course, they appear to be ignoring the fact that bear market rallies are quite common, and that the current upswing may just fit the bill. The average bear rally in history is approximately 11%. We stand at roughly 11.5% off of the correction lows right now. What’s more, there’s a fair amount of technical resistance in and around the S&P 500 range between 2625 and 2650. Credit key players in the…

Read More

How Long Before Powell Throws In The Rest Of The Towel?

By | Bond ETFs, China ETFs, Consumer ETFs, Current Affairs and ETFs, ETF Philosophy, ETF Strategy, Large Cap ETFs, Popular Posts, Real Estate ETFs, Semiconductor ETFs, Special Sectors ETFs, Technology ETFs, US Markets and ETFs | No Comments

It was only a few days ago when the stock market celebrated a Trump-Xi tariff delay. And it was only a few days before that when Federal Reserve Chairman Powell flip-flopped on the extent of rate hiking yet to come. Both of the above-mentioned actualities sent stocks and risk assets soaring higher. And both were expected to serve as tailwinds for a phenomenal December rally. So how did the Dow lose nearly 1600 points in two days, then recover roughly…

Read More

Should You Buy the S&P 500 Dip Or Sell the S&P 500 Rips?

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

Until recently, the U.S. stock market had been taking Federal Reserve rate hikes and quantitative tightening (QT) in stride. The investment community had come to believe that corporate tax reform would compensate for the gradual removal of ultra-easy interest rate stimulus. Indeed, up through October, rising interest rates had been hurting bonds far more stocks. Corporate credit assets of all sizes and shapes have logged total return losses year-to-date. The last time this happened? 2008. Lately, however, sellers have been overwhelming…

Read More