Daily Insights

21 Aug 2023

What’s Happening in China?

One of the sources of optimism entering 2023 was that China was finally “reopening” after their long and agonizing Zero-Covid lockdown. Not only is the China-related optimism long gone, but markets are increasingly worried about the economic situation there. Although a lot of the news relates to a vastly overindebted property company whose bonds are trading for 35 cents on the dollar, the issues are much greater. First, growth is… Read More

By David Ott Tags: China, Economy, International Investing, Investing, Markets, Stocks, Volatility

14 Aug 2023

Thank You Short-Sellers

Growing up, my best friend’s father was a pilot for Ozark Airlines. He seemed like a pretty happy-go-lucky guy who loved flying and golfing when he wasn’t flying. His demeanor changed markedly when Carl Icahn’s backed TWA bought Ozark. I didn’t understand it much then, but I heard terms like ‘corporate raider’ and ‘asset stripping’ at the time. To my friend’s dad, Icahn was a true villain who borrowed money… Read More

By David Ott Tags: Investing, Markets, Short Selling, Stocks

7 Aug 2023

So You Say You Want Alpha: Cathy Woods has Some

Cathy Woods is a fascinating character. Her ARKK funds were the darlings of the pandemic, focused on innovation, and were on fire. Not surprisingly, investors poured money into the funds, just in time for them to collapse. The fact that investors piled in and out isn’t Woods fault. She bought a portfolio of stocks that she believed in and stuck to her style through the boom and the bust. Last… Read More

By David Ott Tags: Alpha, Beta, Investing, Markets, Portfolio Strategy, Stocks, Volatility, Wall Street

31 Jul 2023

Glad to be Alive

For 20 years, a life insurer pulled a little less than $90 out of my bank account. What do I have to show for it, 20 years and $21,600 later? Nothing! Well, except that I’m alive, which is pretty great. When I bought the policy, I got a lot of advice about what kind of insurance I should buy. Most people I talked to said I should get simple level-premium term insurance,… Read More

By David Ott Tags: Financial Planning, Insurance, Term Insurance, Whole Life Insurance

17 Jul 2023

You Better Think (think!) About Estate Planning

The Queen of Soul, Aretha Franklin, died in August 2018. Five years later, the battle over her estate ended after a two-day lawsuit that should allow her estate to finally settle. At issue was that Franklin left two wills behind, both handwritten (one tucked in a notebook under a couch cushion), and they were contradictory. Initially, her four surviving adult children thought there was no will since they couldn’t find… Read More

By David Ott Tags: Estate Planning, Financial Planning, Planning, Trusts, Wills

10 Jul 2023

Lessons from the Land of the Rising Sun

When I was in high school, Japan Inc. seemed invincible. Their economy was booming, which pushed up their real estate and stock markets, and a handful of over-the-top events like the purchase of Rockefeller Plaza by Japanese investors and the sale of Van Gogh’s Portrait of Doctor Cachet sold for $82.5 million (or $189.5 million in today’s dollars). From 1970-1989, the Japanese stock market, according to MSCI, gained 16.9 percent… Read More

By David Ott Tags: Diversification, Economy, International Investing, Markets, Recession, Stocks, Volatility, Wall Street

26 Jun 2023

Decoding How the Mighty Greenback Shapes Your Investments

Last week, I was asked to consider writing an article about how the dollar’s strength or weakness impacts a portfolio. I’ve covered it a bit over the years, but I thought now would be a good time for an update, and I’m always interested in writing about what readers want to read about, so I try to address specific issues whenever possible. I will illustrate later how the dollar has… Read More

By David Ott Tags: Currency, Currency Hedging, Currency Prices, Economy, Investing, Markets, Portfolio Strategy, US Dollar, Volatility, Wall Street

20 Jun 2023

The McNealy Problem

James Grant is one of my favorite market gadflies. He is the editor of the eponymous James Grant’s Interest Rate Observer, a columnist for Barron’s, and host of the Grant’s Current Yield podcast. Grant is intelligent, funny, and a long-term market skeptic. I’ve heard him say he doesn’t like being described as a perma-bear, but he’s been bearish for as long as I can remember and seems a true gold bug. So,… Read More

By David Ott Tags: Economy, Investing, Markets, Stocks, Volatility, Wall Street

12 Jun 2023

The Bond Market is of Mixed Minds about a Recession

One of the things that I hear all the time these days is that the bond market and the stock market aren’t in agreement about whether a recession is coming. Usually, I hear this from someone who thinks that the bond market is right and that the stock market will correct sharply when the recession comes. And in fact, bond investors are giving strong signals of a recession from the… Read More

By David Ott Tags: Economy, Federal Reserve, Interest Rates, Investing, Markets, Recession, Stocks, Wall Street

5 Jun 2023

The Market Has Bad Breadth

The S&P 500 is up 12.4 percent year-to-date as of Friday, which is excellent news. Less excellent, however, is that just a few stocks are powering the entire return. The half-dozen largest stocks in the index are worth about 25 percent of the index, and they are up 67.9 percent on average. They are all up by over one-third, and two have more than doubled. My back-of-the-envelope calculates that the… Read More

By David Ott Tags: Economy, Investing, Markets, Stocks, Wall Street

Insights

Our Knowledge, Straight to Your Inbox