13 Apr 2020

Coronavirus & Earnings Season

Earnings season kicks off this week, and although we’ve seen a few economic data releases, earnings announcements will offer a lot of information about how the coronavirus is impacting companies. Right now, according to FactSet, earnings are expected to be lower by 10 percent compared to the first quarter last year.  If that’s the case, it will be the largest year-over-year decline since the third quarter of 2009, when the… Read More

By Tags: , , , ,
6 Apr 2020

Markets Stabilizing, but Still Turbulent

There is no question that we haven’t even started to see the economic impact of the coronavirus, since all of the data that we get is in arrears. For example, last week we got two important pieces of data about unemployment that told different stories.  The good news is that the unemployment rate in march was 4.4 percent, which is an increase from the previous month, but not bad. However,… Read More

By Tags: , , ,
30 Mar 2020

A Breath of Fresh Air

Stocks rallied in response to the fiscal and monetary policy response from the government. On the monetary side, the Federal Reserve announced that they would provide ‘unlimited’ quantitative easing (QE), and announced new facilities to support credit markets. The Fed had recently committed to buying $500 billion in Treasury bonds and $200 billion in mortgage-backed securities, and said that it would continue in the amounts needed to support smooth market… Read More

By Tags: , , ,
23 Mar 2020

From Inside Acropolis

Today, I thought I would cover two topics.  First, I want to update you on how Acropolis is operating, and, second, offer some thoughts on what one prominent economist is saying about the impact of the coronovirus. Regarding Acropolis, it appears that our regular disaster recover preparations were worth their time and energy.  As a Registered Investment Advisor, Acropolis is required to have a disaster recovery plan in place and… Read More

By Tags: , , ,
2 Mar 2020

We Planned for This

The selloff was mostly driven by concerns about the spread of the coronavirus outside of China.  Although the World Health Organization (WHO) said that it was not yet a pandemic, it increased its risk assessment from ‘high’ to ‘very high.’ Although the bond market received less media attention, the results were equally dramatic.  For reference, the yield on the 10-year US Treasury on January 31st was 1.51 percent.  On Friday,… Read More

By Tags: , , , ,
13 May 2019

Trade Troubles

As noted above, the big story last week was about the on-again-off-again trade deal between the US and China. It’s impossible to know where the deal goes from here, but the options are basically as follows: Talks Continue.  The negotiation deadline could be extended as it was before with tariffs frozen and additional sanctions possible.  The status quo should be stabilizing for markets for a while, despite the policy uncertainty…. Read More

By Tags: , , ,
1 Apr 2019

The Most Powerful Man in the World

For the stock market, the first quarter of 2019 turned out to be the mirror image of the last quarter of 2018. Since hitting a low on Christmas Eve, there has been no looking back for the S&P 500 as it rebounded over 13% thus far in 2019, nearly erasing the bear market losses from the end of 2018. Clearly, this renewed optimism in the markets is a result of booming economic… Read More

By Tags: , , , ,
18 Mar 2019

Risk & Volatility

Using the words ‘risk’ and ‘volatility’ interchangeably is one of the bad habits of many financial professionals, myself included.  When pressed, we know better, but we make this mistake all of the time nonetheless. Merriam-Webster has four definitions of risk as a noun, two of which are applicable here: ‘the possibility of loss or injury,’ and ‘the chance that an investment (such as a stock or commodity) will lose value.’ Volatility, according to Merriam-Webster,… Read More

By Tags: , , ,
11 Feb 2019

Why Bother with International Stocks?

According to data from Dimensional Fund Advisors (DFA), the value of the US stock market at year-end was worth $28.1 trillion – about 55 percent of the market value for all of the world’s stocks, which totals $51.2 trillion. Developed international stocks are worth $17.4 trillion in aggregate (34.0 percent), and emerging markets stocks are worth $5.7 trillion (11.0 percent). In theory, passive investors should allocate their portfolio accordingly. In… Read More

By Tags: , , , ,
14 Jan 2019

Is the Market Rigged?

When I was in college, I read Liar’s Poker, by Michael Lewis.  It’s the true story of Lewis’ job out of college on the trading floor at Soloman Brothers, the most powerful bond trading firm in the world at that time. Many of the characters like John Meriwether, Lewis Reneri, and John Thain are still staples of the financial media, but no one became more famous than Lewis himself. He’s… Read More

By Tags: , , ,