13 Feb 2018

Stock Market Correction: The Early Autopsy

While I think it’s far too early to say that the correction is over, the sharp rallies over the past two days are welcome signals that suggest the forced selling that characterized last week’s sharp daily losses may be over. My view of the recent market selloff has two components.  First, as I outlined on last Monday, February 5th (click here for the article), I believe that the initial cause… Read More

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5 Feb 2018

What the Heck Just Happened?

What the heck happened?  Stocks were rolling along, picking up steam even, when all of a sudden, out of the blue, ‘POW!’, the index hit a wall. In reality though, while the move lower was a surprise, it wasn’t really all that surprising.  It’s true that I couldn’t have told you the week before that stocks would have fallen sharply last week, but a move like this really isn’t out… Read More

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29 Jan 2018

The Market’s Next Phase

Almost a year ago to the day, I wrote an article that discussed a well-known quote from a famous investor, Sir John Templeton.  He said that ‘Bull markets are born on pessimism, grown on skepticism, mature on optimism and die in euphoria.’ Clearly, the bull market that we’ve enjoyed for the last nine years was born in the pessimism of the 2008 global financial crisis.  The rally grew on optimism and… Read More

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2 Jan 2018

My Prediction for 2018

One thing that you can count on at the start of every new year is a fresh set of predictions from those of us in the investment business. Last year, one of the most widely discussed and accepted views for 2017 was that the dollar would continue to gain strength, as it had for the previous three years.  Instead, our currency lost about 10 percent, widely defying the consensus views…. Read More

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11 Dec 2017

Efficient Markets Fact and Fiction

For almost 50 years, one of the most controversial ideas in finance is that markets are efficient, as presented by Gene Fama’s Efficient Market Hypothesis (EMH) in 1966. Let’s start with a simple definition of EMH: Current market prices incorporate all available information and expectations and are the best approximation of intrinsic value. In some ways, it’s such a simple statement that it’s a little surprising that it’s so controversial…. Read More

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4 Dec 2017

The Crazy Thing? Stocks Could Go Much Higher

Long time readers know that I’ve been cautious on US stocks for some time, calling them overvalued in 2014. Last year, I referred to a quote from Sir John Templeton, who famously said that ‘Bull markets are born on pessimism, grow on skepticism, mature on optimism and die in euphoria.’ I said then that I could see the rally continuing on for years but that we were probably moving from… Read More

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20 Nov 2017

The Bucket Approach

In my mind, the word ‘bucket’ should be banned from the investment industry because it brings to mind the ‘bucket shops’ where unlicensed hacks in boiler rooms cajole unwitting investors into pump and dump schemes. Despite my view about this word in this industry, it seems to be what we as a group have settled on for a particular retirement planning strategy (I’m not a fan of smart beta either,… Read More

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6 Nov 2017

The Fault in our Stars

In 2014, one of the breakout movies of the year was The Fault in Our Stars, a romantic drama based on a book written in 2012.  I didn’t see the movie or read the book, but I did notice the box office receipts of $307 million compared to the production budget of $12 million – now that’s a solid return on investment! I also liked the sound of the title,… Read More

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24 Jul 2017

The Most Remarkable Investor that You’ve Never Heard Of

Last weekend, I took an extended drive through the Great Lakes region to drop my kids off at their respective camps. We stayed in Michigan the first two nights – first in Holland and then Munising, right on Lake Superior in the Upper Peninsula.  After a drop off in Minocqua, Wisconsin, we stayed in downtown Madison.  All told, we traveled about 2,300 miles. While my wife and kids were hooked… Read More

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22 May 2017

Quants and the Media

Yesterday, the Wall Street Journal (WSJ) printed four articles in what appears to be a 17 article series on what they call ‘the quants.’  I was so excited to see these articles because I think you could fairly describe some of the strategies that we pursue as quantitative in nature. Unfortunately, I was turned off immediately.  The second paragraph of the first article talked about how the quants use ‘high… Read More

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