1 Oct 2015

What If I was Japanese?

Stocks enjoyed a positive finish to a tough quarter, as the S&P 500 gained 1.91 percent yesterday but was still down -6.44 percent for the quarter. It was the worst quarter for most markets since 2011 during the first phase of the European debt crisis. Somewhat surprisingly, markets shook off weak purchasing manager data from Chicago and the onset of Russian airstrikes in Syria. Some investors believe that more stimulus… Read More

By David Ott Tags: ,
11 Aug 2015

Buffett Bags an Elephant

Warren Buffett wrote in Berkshire Hathaway’s 2010 annual report that they ‘will need both good performance from our current businesses and major acquisitions.  We’re prepared.  Our elephant gun has been reloaded, and my trigger finger is itchy.’ At that time, he was just coming off his largest deal ever, purchasing the railroad Burlington Northern Sante Fe for $26.7 billion in 2009.  In 2013, it appeared that he had bagged his… Read More

By David Ott Tags: ,
4 Aug 2015

Greek Stocks Fall 16% in One Day; Markets Still Efficient

Thankfully, Greece has been out of the headlines for a few weeks as the Mediterranean country continues to negotiate their third bailout in five years. In the meantime, some of the capital controls are beginning to lift: banks reopened on July 20 (although withdrawals are still severely limited) and yesterday, the Greek stock market opened again, albeit -16 percent lower. Obviously, that’s an enormous decline – the S&P 500 has… Read More

By David Ott Tags: , ,
8 Jul 2015

When Bubbles Burst: China Edition

While Greece is getting all of the headlines, the bubble in mainland Chinese stocks that I wrote about in April and June is now bursting (click here or here for refreshers).  The Shenzhen index is down -38.5 percent from its peak on June 12th through yesterday and the Shanghai index is down -27.9 percent over the same time period. The following shows these two indexes in yellow and orange compared to the S&P 500 in blue… Read More

By David Ott Tags: , ,
11 Jun 2015

How to Tell Emerging from Developed Markets

Last week, I wrote that the emerging market stock indexes that Vanguard tracks will be adding mainland China A-shares to their index (click here and for a refresher).  On Tuesday, MSCI, the world’s most popular index creator for non-US stock indexes announced they would not be adding Chinese A-shares to their emerging markets indexes. MSCI believes there are too many regulatory issues related to non-Chinese owners that could make owning… Read More

By David Ott Tags: , ,
23 Mar 2015

The Fed’s New Drug of Choice

Even though I was out of town last week on vacation, I generally keep my ear to the ground for market news and last week that was especially true because the Fed was expected to move one step closer to raising interest rates. For at least a year, the Fed has maintained that they would be ‘patient’ about the timing of raising rates.  I assumed, like most people, that the… Read More

By David Ott Tags: ,
22 Jan 2015

Burgernomics

The Swiss National Bank (SNB) revaluation of the Swiss franc caused me to look at The Economist magazine’s ‘Burgernomics’ website (which can be found here). While it may not be popular with high minded economists, the Burgernomics site attempts to put a fundamental value on currencies from around the world by looking at the cost of buying a Big Mac in each country. In theory, a Big Mac ought to… Read More

By David Ott Tags: , ,
8 Jan 2015

The Specter of Deflation

I almost always skip the opinion section in nearly every publication that I read. When I do read an opinion piece, it’s because it’s written by someone that isn’t affiliated with the editorial board and someone that I admire. Back in November, I read an editorial in the Wall Street Journal by John Cochrane, a respected University of Chicago professor and one of the world’s leading experts on central banks… Read More

By David Ott Tags: ,
11 Dec 2014

Tony Robbins: From Life Guru to Markets Master

Growing up, I watched get-rich-quick infomercials, from selling vitamins through tiny classified ads in thousands of newspapers ($50,000 per week!) to flipping real estate (buy a home with nothing down and walk away from the closing with a $30,000 check!). Although Tony Robbins didn’t sell get-rich-quick schemes, he sold something even more enticing: how to unleash the power already within you to live an extraordinary life – achieving your ultimate… Read More

By David Ott Tags: ,