201710.23
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Bi-Weekly Economic Review: Yawn

When I wrote the update two weeks ago I said that we might be nearing the point of maximum optimism. Apparently, there is another gear for optimism in this market as stocks have just continued to slowly but surely reach for the sky. Which is fine I suppose since we own the devils (although not…

201709.24
8
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Bi-Weekly Economic Review: As Good As It Gets

The incoming economic data hasn’t changed its tone all that much in the last several years. The US economy is growing but more slowly than it once did and we hope it does again. It is frustrating for economic bulls and bears, never fully satisfying either. Probably more important is the frustration of the average…

201708.29
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Bi-Weekly Economic Review: Don’t Underestimate Gridlock

The economic reports released since the last update were slightly more upbeat than the previous period. The economic surprises have largely been on the positive side but there were some major disappointments as well. The economy has been doing this for several years now, one part of the economy waxing while another wanes and the…

201708.20
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3

Questions

Why are profit margins persistently high? With decent earnings this quarter, corporate profits as a % of GDP will approach (maybe exceed) 10% again. That is abnormally high compared to the period 1960 to 2000.  Margins actually started to rise in the mid-80s but really accelerated after 2000 and outside of the 2008 crisis have remained…

201705.22
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Bi-Weekly Economic Review

The economic data releases since the last update were generally upbeat but markets are forward looking and the future apparently isn’t to their liking. Of course, it is hard to tell sometimes whether bonds, the dollar and stocks are responding to the real economy or the one people hope Donald Trump can deliver when he…

201705.18
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Global Asset Allocation Update

There is no change to the risk budget this month. For the moderate risk investor, the allocation between risk assets and bonds is unchanged at 50/50. There are, however, changes within the asset classes. We are reducing the equity allocation and raising the allocation to REITs.  Based on the bond markets there has been little…

201704.23
6
0

Bi-Weekly Economic Review

It wasn’t a very good two weeks for economic data with the majority of reports disappointing. Most notable I think is that the so called “soft data” is starting to reflect reality rather than some fantasy land where President Trump enacts his entire agenda in the first 100 days of being in office. Politics is…

201704.20
2
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The Fiduciary Rule Educates The Public

Our Chief Compliance officer Rafael Perez provides a good overview of the Fiduciary Rule below. In coming months, he’ll be writing a series of articles on legal standards related to brokers and advisers. Our industry has become a thicket of rules and regulations with compliance an increasingly complicated and costly issue for RIA firms. As…

201702.05 1

Pump It Up

She’s been a bad girl. She’s like a chemical. Though you try to stop it, she’s like a narcotic. You wanna torture her. You wanna talk to her. All the things you bought for her, putting up your temp’rature. Pump it up until you can feel it. Pump it up when you don’t really need…

201611.20
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Bi-Weekly Economic Review: Regime Change

Economic Reports Scorecard The reported economic data of the last few weeks (it’s been 3 weeks since my last update so I guess technically this isn’t the Bi-Weekly Review) provides about as much direction and insight as the polls conducted prior to the election. To my eye, the trend here is trendless with a decidedly…