Equity markets bounced in June, reinvigorated by strong employment data, "no recession" calls from key policymakers, and hopes the Fed would "pivot" away from aggressive rate hikes. Some believed June marked the bottom and we were starting a new bull market. I wasn't convinced by policymakers and wrote markets may want to hold the champagne … Continue reading Not Yet Broken
Today, Chairman Powell reiterated the US is not in recession and will continue to grow in the second half of 2022. Other public officials agree, US Treasury secretary Yellen and US President Biden recently affirmed their own "no recession" opinions. The argument emphasizes a strong labor market and an unemployment rate that hovers near the … Continue reading A Familiar Song & Confetti
MARKET OVERVIEW The global sell-off in financial markets accelerated during Q2. Global equities officially entered a bear market, breaching the technical definition of a -20% decline. US stocks were down most, but all major equity regions were down double digits year-to-date. Even the US bond market was off by -10% for the year. Figure 1: … Continue reading Q3 2022 Update
The NASDAQ is down almost -30% from its November 2021 highs. Unlike the pandemic drawdown, this sell-off doesn't have a clear catalyst. It's unfolding in fits and starts and has investors pointing at a growing list of potential causes - rising rates, a tightening Fed, inflation, slowing growth, high valuations, disappointing guidance, etc. Whatever the … Continue reading A Matter of Perspective
An excerpt from my article published at SeekingAlpha.com. We just experienced one of the fastest bear market drawdowns in history and the S&P 500 was down -36% from peak to trough. Since then, we've also had a quick bounce of +27%. The whipsaw has everyone guessing if the stock market bottomed in March. Of course, … Continue reading A Hopeless Bottom
MARKET SUMMARY After a strong 2019, global equity markets made an abrupt move to the downside in the past month. Most major stock markets have officially entered into bear market territory and are down between 20% to 30%. Figure 1: Global Equity Markets YTD Price Returns With markets already uneasy about slowing economic conditions, the … Continue reading When Boring is Better
I've been asked several times what will cause the next major bear market, what's the proverbial "next shoe to drop?" In 2018 some thought Bitcoin's collapse would be it and this year some are pointing at passive investing. While I think these issues could exacerbate market swings, that's different from saying they will be the … Continue reading Heavy Shoes for the Holidays
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