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Special Sectors ETFs

Do Not Blame China For U.S. Dependence On Debt, Deficits And Low Rates

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

Over the 10 trading days (2 weeks) through April 6, the S&P 500 averaged a daily range of 2.3%. According to Dana Lyons of the Lyons Share, that kind of volatility ranks in the 94th percentile since the S&P 500 began in 1950. Similarly, it is uncommon to see at least seven 1%-plus price swings in a brief period like two weeks. We actually had eight. More remarkably, it is rare to witness this type of price movement when it…

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Comeuppance: Stocks Will Not Be Able To Shake The Overhang Of Higher Borrowing Costs

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

The average American household has roughly 6% less spending power than it did a decade ago. How can that be? Hasn’t the economy been expanding at an appropriate clip since the Great Recession? Haven’t median incomes been rising briskly in conjunction with “full employment?” One of the problems may be attributable to demographic shifts. A rising percentage of young adults are living with their parents longer. Meanwhile, a significant wave of older folks are moving in with their adult children….

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The S&P 500 and Stephen Hawking: A Theory on “Peak Everything”

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

The NASDAQ served up an annualized return of 66% in its final two years of dot-com mania. Only after the balloon had burst did people begin to question the lunacy of paying 10x revenue for the privilege of being a shareholder. Ironically enough, since early 2016, the top 10 growth names in tech collectively produced an annualized return of 67%. That’s right. The NYSE FANG+ Index has topped turn-of-the-century craziness. For the current bull-bear cycle, then, we may be witnessing…

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Trade Wars and Currency Wars: Financial Markets Have Good Reason To Be Wary

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

On Tuesday, market watchers did not witness the buying or selling of a single 10-year Japanese Government Bond (JGB) on an exchange. Not a one. Let that sink in for a moment. The Bank of Japan has swallowed up so much of the country’s debt obligations in its quantitative easing endeavors, trading activity across the entire JGB space has become “razor thin.” Theoretically, the circumstances could present liquidity risk. The bid-ask spread for JGBs could widen to such an extent…

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If Consumers Stop Spending, Stocks And Real Estate Will Slide

By | Bond ETFs, 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

Here is an economic data point that you will not hear about in the mainstream financial media: U.S. wage growth in 2017 had been the weakest since 2010. In fact, labor costs rose a paltry 0.35% on a year-over-year basis. Are higher wages for workers, then, right around the bend? Some believe that the tighter labor market is about to spark wage inflation. Yet it seems that this could be wishful thinking. Actual inflation has shown up in housing costs (e.g., rent, repairs,…

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The Most Dangerous Stock Market Ever? Either Way, Have A Plan

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

Today’s stock market may not be as dangerous as 2000’s dot-com euphoria or 2008’s asset balloon. Why not? Global central banks are likely to act quicker and with far more “shock-n-awe” to minimize bearish price depreciation than they did in the previous sell-offs. Some argue that policy efforts would fail to reinvigorate yet another wealth effect because central banks are out of ammunition. I disagree. Indeed, I expect that monetary gamesmanship in the near future will result in an average…

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Are American Stocks Great Again?

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

The U.S Department of the Treasury currently forecasts that the national debt will reach the $25 trillion mark by the 3rd quarter of 2020. That’s just two and a half years from now. What is $25 trillion among American friends? If you combine the debts of every other sovereign state on the planet, you still do not reach $25 trillion. Our nation is a serial debtor. It is easier to dismiss the enormity of the obligation when government is capable of…

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Shock the “Short S&P 500 Volatility” Monkey

By | 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

A top-tier financial web site interviews me at the start of every year. The interviewer typically asks me about specific securities, asset allocation, economic backdrop as well as the impact of events (e.g., central bank monetary policy, mid-term elections, tax reform, etc.) This year, at the tail end of the interview, I fielded an atypical query. He wanted to know what “market surprise” might occur in 2018 (good or bad) that the financial media are not talking about. I thought…

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State of the Stock Market (#SOTSM)

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

The U.S. stock market has rarely notched 150 trading days without back-to-back 0.5%-plus declines. It happened on one occasion prior to the financial crisis in 2007. It also occurred once in the mid-1990s and twice in the 1960s. More recently, the S&P 500 logged an additional streak for consecutive trading sessions. This time, however, 150 days did not serve as the high-water mark. Nor was it 200 or 250 days. The new record streak that culminated on January 30, 2018? Try…

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Nothing To Fear In The Stock Market But The Fear Of Missing Out Itself

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

I have quite a few clients in their eighties and a number in their late eighties. That is not particularly surprising when your client base is chock-full of retirees and near retirees. What did surprise me a bit is a call from an 87-year old client yesterday afternoon. She called to inquire why her friends are making more money in the stock market than she has been making recently. “Are most of your friends in their 40s or 50s?” I…

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