11 Jan 2024

Portfolio Insights

We are pleased to provide a digital copy of Portfolio Insights, our quarterly newsletter. Table of Contents: Stock Market Summary Bond Market Review Why We Fear Inflation Inside the Economy Protect Yourself Against Fraud The Big Picture Click here to read the issue: Q4 2023 Portfolio Insights

8 Jan 2024

Amid Soft-Landing Talk, Leading Indicators Still Signal Recession

Last year at this time, I was heartily in the camp that the US would enter a recession in 2023. I’m always fine being wrong (it happens more than I care to admit), but I’m especially happy that we didn’t enter a recession. Part of my thinking is a chart that we will see a later in this Insight that shows the drawdown of Leading Economic Indicators. I won’t bury… Read More

2 Jan 2024

Happy New Year

Perhaps the subject line should have read: Happy Old Year! Today will be brief but take a moment to look at the charts below, which show the return for various stock and bond market indexes in the fourth quarter and for the year that was. The worst major asset class return was just shy of 10 percent, and the best was more than 26 percent – a result that almost… Read More

18 Dec 2023

Fed Chair Powell Dons Red Suit and Fake White Beard

Halloween turned out much more treat and much less trick this year, as it ushered in an early Santa Claus rally. Since October 27th, the S&P 500 is up 14.6 percent, which is more than we hope for in a good year. For the year, the S&P 500 is up almost 25 percent. We’ve still got a few more weeks, so it’s too early to start counting your chickens, but… Read More

11 Dec 2023

Visualizing the Labor Landscape

Probably not surprisingly, I follow the major economic data releases, but I often look at charts because I find the charts provide useful context about the new information. Take the nonfarm payrolls release last Friday. Everyone seems pretty excited about the data because it beat expectations and suggests that the economy is holding up reasonably well despite much higher interest rates. The chart below shows the monthly nonfarm payrolls for… Read More

4 Dec 2023

Why We Fear Inflation

I wasn’t sure what I was going to write about this week and thought about simply starting with a picture of inflation, as measured by the Federal Reserve’s preferred measure, the core Personal Consumption Expenditure, or PCE. Like the core Consumer Price Index, core PCE strips out food and energy prices because they are so volatile, but don’t really change the numbers of the long run. Said, another way, they… Read More

27 Nov 2023

Fooling Yourself with Private Market Math

Private investments, or simply ‘privates’ in the current vernacular, are among the hottest investments in recent years. Private investments, which are often considered one of the most prominent alternative investments, means owning securities that aren’t publicly traded. Private markets can include equity (stocks), credit (bonds), and real estate. Each major group has subcategories. Private equity can be venture capital, buyout equity, or growth equity. Credit can mean direct loans, mezzanine… Read More

13 Nov 2023

30 Market Timing Signals that Worked

My subject line is taken from an article written by the PhD Head of Investment Research at Dimensional Fund Advisors (DFA), but I cheated and left out the second half of the sentence. Here’s their full headline: We Found 30 Timing Strategies that “Worked” and 690 that Didn’t. I guess I’m not above clickbait, but I also don’t have enough space to get the full headline into the subject line…. Read More

6 Nov 2023

Have Bonds Become More Volatile Than Stocks?

Before the big rally last week, a client asked me whether bonds had become more volatile than stocks. Although he was partially kidding, his point was right on: bonds have been volatile this year, especially in recent weeks. And the rally last week still adds to volatility, it’s just easier to stomach when prices are rising. To illustrate the rise on bond volatility, I calculate the 20-day rolling volatility of… Read More

22 Oct 2023

Portfolio Insights

We are pleased to provide a digital copy of Portfolio Insights, our quarterly newsletter. Table of Contents: Stock Market Summary Bond Market Review Thank You Short Sellers Inside the Economy You Better Think! The Big Picture Click here to read the issue: Q3 2023 Portfolio Insights