The U.S. markets are closed today. The UN Security Council is not. It met this morning to discuss the latest provocations of North Korea and the recent test of a hydrogen bomb. The Security Council has met 10 times this year already to discuss the issue. Are we any closer to a tipping point and …
Continue reading “North Korea And The Markets: The Big Risk Is Trade”
Investing involves numbers. There is no getting around the need for basic math. Academics and derivatives nerds sometimes make the process unnecessarily complicated. Most investors don’t need such a high level of sophistication to invest successfully. Click to read the entire article on Forbes
The Bank for International Settlements, the BIS, just released a 47-page report on the impact of changing global demographics, and if their predictions are correct, it will mean higher interest rates and slower growth for most developed nations. The statistical study of how populations age by extrapolating fertility rates and life expectancy, known as demographics, …
Continue reading “Can Demographics Predict The Next Interest Rate Cycle?”
Artificial intelligence. Big data. ETFs. Smart beta. Systematic trading. They will destroy hedge funds and the active management industry. That seems to be the prevailing view from the media. Indeed, these are very powerful forces causing change, but there is a big difference between an industry in transformation and an industry about to die. Click …
The calls for a correction in US stock valuations seem to grow louder by the day. Many bears point to the historically elevated price-to-earnings ratio of the S&P 500 to jump to the conclusion that stock prices must go down, and investors should brace for negative future returns for the broad equity market. Fortunately, the …
Continue reading “A Correction In Equity Valuations Does Not Have To Be Painful”
Forecasting GDP in not easy. It involves multiple variables and inputs, many of which are subject to revision. If anybody could do it well, you would think it would be the Fed, right? They have an army of staffers who spend their entire working lives looking at every piece of economic data, trying to attach …
Continue reading “Did The Fed Make A Mistake When It Raised Rates?”
It has happened to us all. We invest money with the best intentions only to discover, in hindsight, we made a huge mistake. Sometimes the mistake is legitimate- our analysis was faulty, we let our emotions get the better of us, or we just had bad luck in timing. It stings. But when we lose …
Continue reading “Too Good To Be True? How To Spot Investment Fraud”
The standard gauge of fear in the market – short-term implied equity volatility (the VIX) – recently touched an 18 month low. Some people think this is a sign of stability: the equity market has rocketed higher post-election, corporate earnings have rebounded and global growth is expected to increase. Others see the new low as a …
There is an old Wall Street proverb stating “Nobody rings a bell at the top or the bottom of a market.” That’s true. But sometimes you can see and hear a crowd gathering in anticipation, and there is a growing crowd of central banks and investors preparing for the eventual burst of the bond bubble. …
Cheap bonds are hard to find in a world dominated by negative short-term interest rates. Record-low yields on long-dated government bonds, corporate bonds priced to perfection and high volatility emerging market debt do not provide much potential return relative to risk. Municipal floating rate bonds are the proverbial diamond in the rough. The cheapening of the …
Continue reading “Income Investors Just Got A Gift From The SEC”
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