“It’s hard to make predictions, especially about the future,” Yogi Berra famously said. The S&P 500 pushed to a new high last week and the yield on the 10 year U.S. Treasury Bond dropped to the year’s low May 15—confusing signals. Ordinarily, a rising stock market anticipates higher economic growth, and higher interest rates usually
Mixed economic signals and investor uncertainty are two interrelated topics we address this week. We explore bond and stock markets that are providing divergent messages. Then, we address a strategy—really a different perspective on what we already are doing—to address uncertainty in conditions like these. Fears over ‘lowflation’ serve up a bond market surprise. Yields
The prospect of interest rates remaining low for longer has become clearer in the first 100 days of Janet Yellen’s leadership at the Federal Reserve. At the same time the threat of new asset bubbles forming may have become more pronounced. These are views expressed by faculty at the Wharton Business School. While tapering of
Patience is a virtue when it comes to investing. It’s human nature to want to own winners and avoid losers. Unfortunately, investor behavior often works against a successful long-term investment program. Generally, investors—left to their own devices—sell losers at the wrong time and invest in hot sectors, only to see the performance of recent winners
What is an investor to do in the face of mounting evidence of an overvalued market? This question was posed by a handful of clients this week in response to last week’s blog highlighting that investors currently are downplaying risk; that several valuation measures are flashing caution warnings; and that investors should be prepared for
March 9th marked the five year anniversary of the current bull market. Memory of the previous bear market is a distant recollection to some. 2013 saw the S&P 500 jump 32 percent and the Nasdaq jump 40 percent while corporate earnings barely increased. U.S. equity indices recently hit record highs. This week we examine reasons
During the streak of bad weather this winter some concern was expressed that the economy would lose steam. Despite the bad weather, the economy managed to produce a decent number of jobs in February. We address Friday’s jobs report and what it means. We’ve had a number of questions posed recently about the size of
Just as one cold wave follows another this winter, waves of market volatility have become the norm in 2014. Do the waves of volatility forecast a change in the investment climate, or is it just a naturally recurring market rhythm? Based on our readings, seasonal volatility does not appear to be a precursor of a
Markets have been choppy since the page turned to another year. Uncertainty about the withdrawal of economic stimulus by the Federal Reserve, the pace of economic growth, and the potential for contagion spreading from emerging markets have been leading causes. This week we examine these issues as they relate to one another. We believe reasons
Janet Yellen takes the helm of the Federal Reserve February 1. She will be the first female head of the Central Bank. Just what kind of leader will she be? That’s the question we ask this week. She is a first rate academic uniquely qualified to address the current labor market malaise. She cares more