Archive | Current Affairs and ETFs

Fatal Consequences: One Way Or Another, The Credit Boom Will Go Bust

The conductors of the crazy credit train – Janet Yellen, Mario Draghi, Mark Carney and Haruhiko Kuroda – are running out of tracks. Consider the following: 1. Central banks own $25 trillion of the world’s financial assets. That approximates 8%-8.5% of the total dollar value of stocks, bonds and the array of market-based securities available. [...] Continue Reading...


Why Aren’t Businesses Investing In Their Futures?

The last three times that private businesses cut back on fixed asset expenditures – plants, trucks, tools, software, hardware, equipment, office buildings and other capital goods – the country slipped into recession. Is this time different? Or does company reluctance to buy machinery, commercial real estate and electrical appliances signify that economic contraction is around [...] Continue Reading...


Quantitative Failure: Is The Faith In Central Bank Omnipotence Fading?

What do investors in “high quality” bonds worry about the most? The folks and Bank of America Merrill Lynch Global Research wanted to know. It turns out, investors are increasingly concerned about the bursting of a bubble in credit. It may not be surprising that nearly one-third of high-grade credit respondents are troubled by the [...] Continue Reading...


The Mad Scramble For Yield Ignores A Real Risk Of Financial Loss

Is debt inherently bad? Probably not. After all, most homeowners require a mortgage to afford the “American dream.” Indeed, most folks believe that financing real estate is a venerable wealth-building endeavor. They trust property appreciation more than they trust market-based securities like stocks. Bear in mind, low mortgage rates in the 5.5%-6.5% range coupled with [...] Continue Reading...


Buy Or Sell Tesla (TSLA)? Tell Me What The “Feds” Are Going To Do

A client recently asked me for an opinion on Tesla (TSLA). I snickered. Not because I had a negative outlook on the electric vehicle manufacturer. Nor did I laugh because I doubted Elon Musk’s ability to lead. Did I chuckle because auto demand might be peaking? No, that wasn’t it. Or because low gasoline prices [...] Continue Reading...


Do Celebrated Fund Managers Know More About the Credit Balloon Than You Know?

There was a time when hedge funds may have offered something unique in the way of performance. You may have been able to make a case for them alongside a mix of stocks and intermediate-term treasury bonds. Over the last three years, however, hedge funds have been downright abysmal. Consider the IQ Hedge Multi-Strategy Index ETF (QAI). It [...] Continue Reading...


How Should You Address The Existing Risk Of Disastrous Loss In The Market?

The previous decade’s financial crisis did not begin in earnest until 2008. Bear Stearns. Lehman Brothers. AIG. And yet, the warning signs had appeared long beforehand. Real estate sales had turned negative on a year-over-year basis in 2006, even as prices kept climbing. Meanwhile, SPDR Select Sector Financials (XLF) logged -21% in 2007, even as [...] Continue Reading...


5 Inconvenient Stock Truths For The Bold And The Reckless

Here are five big-league reasons to evaluate your current asset mix: 1. Credit Fundamentals Are Deteriorating. What do you remember about the financial crisis in 2008? Perhaps you think about a term like “subprime mortgage.” Or maybe you recall the way home values and stock prices collapsed. Either way, most would agree that households and [...] Continue Reading...


Stock Market Gains: A Vote Of Confidence For The Economy?

Wall Street analysts may regard the U.S. economy in a favorable light. Indeed, many believe that higher stock prices reflect optimism about the country’s economic future. Yet Gallup’s U.S. Economic Confidence Index portrays an entirely different picture. More and more Americans believe the economy is getting worse. In fact, even as U.S. stocks push upward to [...] Continue Reading...


What Is The Most Opportunistic Asset Class Right Now?

Are the new all-time highs in U.S. large cap stocks as big a deal as the media would have you believe? On a year-over-year basis, other asset classes have been more impressive. Bonds via Vanguard Total Bond Market (BND), gold via SPDR Gold Trust (GLD) and the “risk-off” Japanese yen via Currency Shares Yen Trust [...] Continue Reading...


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