201711.13
6
4

Desperately Seeking 1995

The year 1995 wasn’t exact a good year to remember. There was the Oklahoma City bombing, the San Diego tank rampage, the New Jersey Devils winning the Stanley Cup in a lockout shortened NHL season, and some former Buffalo Bills running back named OJ getting into trouble out in LA. Steve Forbes would announce his…

201705.18
2
1

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…

201704.26
9
2

Clickbait: Bernanke Terrifies Stock Investors, Again

If you are a stock investor, you should be terrified. The most disconcerting words have been uttered by the one person capable of changing the whole dynamic. After spending so many years trying to recreate the magic of the “maestro”, Ben Bernanke in retirement is still at it. In an interview with Charles Schwab, the…

201704.12
8
1

Is It Other Than Madness?

As earnings season begins for Q1 2017 reports, there isn’t much change in analysts’ estimates for S&P 500 companies for that quarter. The latest figures from S&P shows expected earnings (as reported) of $26.70 in Q1, as compared to $26.87 two weeks ago. That is down only $1 from October, which is actually pretty steady…

201703.24 4

The Inverse of Keynes

With nearly all of the S&P 500 companies having reported their Q4 numbers, we can safely claim that it was a very bad earnings season. It may seem incredulous to categorize the quarter that way given that EPS growth (as reported) was +29%, but even that rate tells us something significant about how there is,…

201702.21
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2

Discounting, Or Never Learning?

The hedge fund industry is not quite dead yet, meaning that it can still cause a great deal of disruption before it expires. It is here where things like rehypothecation and the bastardization of prime brokerage functions were perfected, such that we might use that term in this manner. Despite so much outward attention paid…

201702.21
8
3

The Market Is Not The Economy, But Earnings Are (Closer)

My colleague Joe Calhoun likes to remind me that markets and fundamentals only sound like they should be related, an observation that is a correct one on so many different levels. Stock prices, in general, and GDP growth may seem to warrant some kind of expected correlation, but it has proven quite tenuous at times…

201701.25
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2

Bi-Weekly Economic Review

Economic Reports Scorecard Well it’s time to get back in the habit of doing this every two weeks. The schedule was interrupted over the holidays and then again by my annual outlook piece.  The economic data released over the last two weeks was not particularly inspiring, not that hard data is what has been egging…

201610.13
9
0

All Kinds Of Stock Market Irregularities

A great many asset classes have been moving almost perfectly sideways for months now. That is unusual by any standard, but more so given the circumstances of late 2016. This might be indicative of doubts, some of which are being reinforced by weakness that might be characterized as “unexpected” but really no longer is. Today’s…

201609.20
1
0

Earnings And Valuations Update; Still Nowhere Near Good

At the end of July with a majority of the 500 companies included in the S&P 500 index having reported their earnings, the tabulated EPS (as reported) was figured around $24.09. That was already down sharply from just a month earlier when compared to analysts’ expectations from just before Q2 earnings season started. In late…