The Expectations Gap

The stock market had a good week, up all four trading days, despite the continued mixed picture from the economy and earnings. Last week’s economic reports continued the recent pattern of some seemingly strong reports mixed with some pretty obviously weak ones. Retail sales were better than expected but the year over year core growth .. read more

A Weak Dollar Environment

The US Dollar index exhibits the classic characteristics of a downtrending asset: Declining 50 and 200 day moving averages with the 50 solidly below the 200. Momentum indicators (MACD, PMO) both on sell signals. A longer term view shows the index on the edge of support: A break of the 78-79 support level would open .. read more

Why The Market Really Sold Off Last Week

Josh Brown at the Reformed Broker had a post last Thursday titled Why Did The Stock Market Sell Off Today?. It is a very clever and funny post that plays off the biases of various media. A sampling: Wall Street Journal: Tensions in Ukraine and the Crimean peninsula Yahoo Finance: Russians Fox Business: Obamacare CNBC: .. read more

Subtle Shifts

While most everyone in the investment world has been focused like a laser beam on the amazing US stock market, some subtle shifts are happening that could have major implications for investors. These shifts are not large yet but they are significant if they are the beginning of a trend. For the last couple of .. read more

A Little Dot Com Deja Vu

in exchange for an aggregate of 183,865,778 shares of Parent’s Class A common stock (valued at $12 billion based on the average closing price of the six trading days preceding February 18, 2014 of $65.2650 per share (“Specified Price”)) and $4 billion in cash… In addition, upon Closing, Parent will grant 45,966,444 restricted stock units to WhatsApp employees (valued .. read more

Butterflies, Blowback & Unintended Consequences

The Law Of Unintended Consequences, often cited but rarely defined, is that actions of people – and especially of government – always have effects that are unanticipated or unintended. Economists and other social scientists have heeded its power for centuries; for just as long, politicians and popular opinion have largely ignored it. Rob Norton, The .. read more

Why I Worry So Much, Part 2

In part 1 last week, I reviewed the two most important indicators of future economic growth – workforce growth and productivity growth. Both of these metrics are trending negatively with the workforce shrinking and productivity growing at rates less than 1/3 of what we experienced in the late 1990s. It is my view that changing .. read more

Why I Worry So Much

When I got in the investment business 23 years ago, a very wise man told me that my job as an advisor was to find clouds when everyone else saw nothing but sunshine and to find the rays of hope when everyone else was hunkered under an umbrella. Markets and economies move in cycles and .. read more