Although I wasn’t yet in the wealth management business, I vividly recall the tech bubble in the late 1990s. I graduated from college in 1995, and remember the Investments professor saying that markets were overvalued. In my first few years on the job, I witnessed the Dow cross 5,000 and then 10,000 within just five years. I was working in foreign exchange and was going through a terrible bear market… Read More
Even if everything goes according to plan, we are probably stuck with zero percent on cash for the next few years. We’ve been in this situation for so long that it almost seems normal, and with some negative interest rates elsewhere around the world, sometimes zero even seems good (actually, it never does, but negative is just so bad). Earning nothing is so lousy that every once and a while,… Read More
In celebration of the Fourth of July, I wrote about how we are fortunate to have the freedom that other countries don’t always enjoy. Specifically, I wrote about China and its recent crackdown on Alibaba after the founder and CEO Jack Ma made comments that the government found unacceptable (you can read the article by clicking here). Little did I know that we were at the beginning of a terrible… Read More
Some of the hottest exchange-traded funds (ETFs) over the past few years come from the ARK family of funds, founded and run by famed investor Cathy Woods. The ARK funds are a series of theme-based ETFs that seek to find the early companies in a variety of emerging fields including robotics, space exploration, genomics, fintech, and 3D printing, among others. I can’t say that I’m very familiar with the ARK… Read More
Markets were caught off guard last week by several inflation data points last week, and the biggest surprise came from the core inflation rate which was expected to come in at 0.3 percent for the month but was 0.9 percent instead. Most of the time stocks and bonds move independently of each other, but stock and bond prices fell on the inflation news because it could prompt the Federal Reserve… Read More
Over the last six months or so, small-cap stocks have enjoyed one of their strongest periods of relative performance in history. In the five months that ended in February, the S&P 500 is up 14.1 percent, which is a terrific return, but the S&P 600 Small-Cap index, is up 50.3 percent, which is tremendous. This month isn’t over, so it’s too soon to say for sure, but as of Friday,… Read More
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
As I noted here last week, despite the market turmoil, it is important to remember that we planned for this. We have prolonged periods of market stress built into our financial plans. It’s also moments like this when we can see whether we’ve accurately assessed your risk tolerance. Every client has an Investment Policy Statement (IPS) that estimates how much an allocation could lose over certain periods. Importantly, we don’t include… Read More
Every year, the investors and the financial media eagerly await Warren Buffett’s annual letter to shareholders, and this year was no exception. I didn’t start reading them until four or five years ago, although I once read book that reorganized his letters by topic rather than chronology. Each year, I like to think that I’ll go back and read his letters, which can be found here, on Berkshire’s hilariously antiquated website – but I… Read More
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
