“I’ve never seen THIS in 34 years of investing,” quipped media personality Jim Cramer on Monday. What was Mr. Cramer referring to? For the most part, he expressed excitement over the stock market’s ability to reward stocks of companies that missed earnings expectations as well as to reward those that beat expectations by not taking [...] Continue Reading...
For the first time in 2013, investors do not appear to be tripping over themselves to buy every fractional percentage dip. Here on 4/15, the media have blamed the accelerated selling on commodity price depreciation and a disappointing GDP reading (7.7%) out of China. So we’re supposed to believe that a manic Monday where the domestic [...] Continue Reading...
Wayne Lin manages money at Baltimore-based Legg Mason Inc. In a phone interview with the folks at Bloomberg, he explained that many investors have been surprised by the significant under-performance of emerging market equities in the global “risk-on” rally. How anemic have the upside gains for emergers been? Â Since the October lows of 2011, Vanguard Emerging [...] Continue Reading...
Las Vegas odds-makers believe that the San Francisco 49ers will beat the Baltimore Ravens to win Superbowl XLVII this Sunday, February 3. That’s what is implied by a 4-point spread. In contrast, if the professionals did not feel that the 49ers had a definitive edge, there would neither be a spread nor a so-called “favorite.” And [...] Continue Reading...
The yield on a ten-year treasury bond is very close to recovering 2%. That may sound ridiculously low when placed in a historical context. On the other hand, funds like iShares 10-20 Year Treasury (TLH) have logged -2.1% returns year-to-date, precisely because the 10-year’s yield has gained 0.25% in 4 short weeks. On a day when [...] Continue Reading...
There are scores of erroneous beliefs that mislead the investing public. However, few are as dangerous to one’s portfolio as the notion that economic growth correlates to stock market performance. Consider the inglorious ride for Chinese equities via SPDR S&P China (GXC). In 2010, China’s GDP growth rate topped 10%, while GXC managed a modest total [...] Continue Reading...
The S&P 500 traded in a 20-point range on Thursday, 12/27. And most of that activity was consistent with risk-off, “sell-it-all” fretfulness. What have investors been fretting? What else… the fiscal stand-off. Early on Thursday, Senate Majority Leader Harry Reid sent broader indexes 1% lower on statements suggesting that a budget deal could not be reached before year-end. Later [...] Continue Reading...
Why is the budget battle as monumental an issue as it is? Over the last 50 years, the U.S. federal government has spent an average of 20% of its economic output (GDP). It has only averaged 18% of GDP in tax revenue. In other words, for 50 years, our elected politicians have regularly spent more [...] Continue Reading...
The S&P 500 is down -3.5% since its early September highs. And many fear that a “fiscal cliff” stalemate will send stocks significantly lower in the weeks ahead. However, there are a variety of ETF categories that have not only remained resilient in the wake of U.S. legislative uncertainty, but they’ve been exceptionally profitable. In fact, [...] Continue Reading...
Most of the world’s attention is on “fiscal cliff” negotiations in Washington D.C. And when we’re not hearing about the latest crack in the Republican coalition, financial journalists provide thoughts on the latest batch of U.S. economic data. The question that many wish to know… “Is the domestic employment picture improving?” If a lower unemployment rate is [...] Continue Reading...
