More Noise Than Signal?

This week will provide the usual flow of data, some political posturing, and more than the typical quota of speeches. Expect more noise than signal! Congress resumes the lame-duck session.  There will be plenty of talk, followed breathlessly by the pundits. Lobbying groups are joining in to influence the fiscal cliff debate. The Fed is […]

Everything You Know About Investing is Wrong …

Source: Vanguard   Over the weekend, I set the Closer Look at Mythology graphic to post early this morning. By sheer coincidence, Meb Faber pointed us to the above chart from Vanguard looking at the correlation between traditional valuation metrics and subsequent investment returns. Given the serendipity of how similar the messages were in both, I thought it was worth exploring […]

Big Moves Coming in December, January and February

Well how was that for the start of a new intermediate cycle? While many analysts were calling for continued losses or even a market crash I repeatedly warned traders that an intermediate degree bottom was coming and that markets routinely rally violently out of those bottoms, often generating 5-8% gains in the first 12 to […]

Can You Find Opportunity in Thanksgiving?

We have a very interesting week ahead.  Despite the gravity of the issues, not much will be happening.  Congress, after convening for a few days, will be back on vacation recess.  There is not much news coming on the economic front.  Equity markets will be closed on Thursday and open only for the morning on Friday. In […]

The Market in a Minute

Although the S&P 500 lost about 1.5% this week, I believe stocks want to move higher. Pre-market futures indicated a higher open each of the five trading sessions, only to be pressured lower during trading hours on worries over the fiscal-cliff. Once a resolution to the fiscal-cliff is apparent, expect a significant rally. Next Weeks’ […]

QE3 Will Work if it Shifts Expectations That the Fed Will Tolerate More Inflation

Beyond the straightforward mechanics of QE3 (i.e., the Treasury and MBS purchases), the Fed’s impact on expectations is key. The guidance indicated that support would remain in place until the economy is well in their clear. By aggressively pushing on bond yields, and more importantly, promising to maintain that effort, Bernanke and Co. definitely had […]

Q3/Q4 Earnings Beats and Misses S&P 500

click for larger table Source: Standard and Poors   Standard & Poor (whom I frequently criticize as awful when it comes to ratings) does excellent work when it comes to assembling data on earnings for their flagship index, the S&P500. Their S&P 500 earnings and estimate report is quite excellent. You can download a spreadsheet from […]

Bond Vigilantes to the Rescue

Paul Krugman claims that should the much-dreaded bond vigilantes show up, they actually would be good for the economy.  He notes that unlike Greece, the United States has its debt denominated in its own floating currency.  Consequently, the appearance of bond vigilantes would lead to an expansionary decline in the value of the dollar, not a […]

An Investor’s Guide to the Presidential Elections

The most important election of our time! The fate of the free world hangs in balance! Yadda yadda yadda! Every four years, the usual clichés comes out. I suggest you ignore them, and instead focus on the policies that are unambiguously different,  and have very different outcomes. More specifically, between the policy pronouncements madde by candidates Barack […]

When A 10-Year Treasury Yield Just Isn’t Enough

In a world of abnormally low interest rates, the search for yield has become a priority for many investors. The good news is that there are several opportunities for boosting your investment income relative to the usual suspects. The bad news is that higher yield tends to come with higher risk. That’s nothing new, of […]