201508.02
3
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The New Normal Gets A Downgrade

It was back in 2009 that Bill Gross coined the term New Normal to describe the post-crisis US economy. That economy is marked by a reduced willingness to take risk in the private sector for a variety of reasons. No interest rate is low enough to induce corporate spending in an environment where aggregate demand…

201508.02
0
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The Weekly Snapshot

Top News Headlines Chinese stocks plunge, then stabilize Linn Energy shows shale bust isn’t over Whole Foods stock hammered on earnings Twitter beats estimates, stock makes 52 week low Gold stops going down Economic News Durable goods orders rebound, still down almost 3% year over year Dallas Fed improves but still negative Case-Shiller shows surprising…

201507.26
3
0

Frustrated Yet?

The last year has been a tough one for investors. There are a few places one could have booked a double digit gain in the last 12 months but not many and certainly not in assets that are in the standard portfolio. Currency hedged ETFs for European and Japanese stocks produced big gains but a…

201507.26
0
0

Tail Risks subside. What’s next?

Tail risks have eased following the end to the current Greek crisis. The world now looks to move toward economic normalization. Bonds performed well during the flight to safety coinciding with the referendum and emergency meeting circuit in Europe during the first half of this month. Now that  investors are collectively exhaling and eyes move toward the…

201507.19
5
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Rose Colored Glasses

All that we see or seem is but a dream within a dream. Edgar Allan Poe All things are subject to interpretation. Whichever interpretation prevails at a given time is a function of power not truth. Friedrich Nietzsche I was walking down the street wearing glasses when the prescription ran out. Steven Wright I think…

201507.19
1
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Bailout – “the Greequel”

The Greek government, EU, IMF and ECB agreed to new terms for a third bailout. As I see it, there are two very important items for markets today. The Greek government will be selling assets to pay down debt and re-capitalize the banking sector. Creditors essentially accessed the Greek collateral they were seeking. In return, the…

201507.12
6
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Cracks In The Facade

There was a point last week – probably about midday Wednesday – when it seemed that the financial world was spinning out of control. China’s Shanghai exchange was continuing its slow motion crash, down almost 6% overnight, Europe was getting hammered as Greece teetered, the NYSE suddenly stopped working, United/Continental Airlines was grounded due to…

201507.11
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Greek Crisis causes Market Volatility

Jeff Snider and I often speak of the balance sheet leverage effect in markets. In the modern system, computer models assess the risk of portfolios throughout the industry. One key input to any value at risk model is volatility. If the standard deviation of prices rises, the computer will tell the managers that there is…

201507.05
2
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Greece Calls Europe’s Bluff

The analysts streaming across my screen last week all had the same opinion – Greece will vote yes, accept Europe’s terms and stay in the Euro. Well, as I write this, the early polls prove, if nothing else, that one should beware of experts bearing consensus opinions. According to the headlines at all the major…