THE DEATH OF VALUE The death knell for "value-investing" has rung many times over the years. And after a decade of lagging explosive growth stocks (like "FANGMAT") it rings louder than ever. The divergence between growth and value has reached historical levels and now looks even more stretched than during the 1990s dot-com boom. Is … Continue reading Long and Short of Value
Global equity markets have continued an "unprecedented" rally and in the US the S&P 500 has notched a new all-time-high. Many intelligent investors have watched in disbelief as stocks shot up despite dismal economic conditions. But the seemingly irrational market may be more logical than it appears. Caution and Uncertainty BCM was certainly in the … Continue reading For Better or Worse
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
An excerpt from my article published at SeekingAlpha.com. Last month, I wrote a piece on coronavirus and China. This month it's clear COVID-19 has become a global concern. While people all over the world are still grappling with the viral pandemic, markets are overcome by a fear pandemic and already in correction territory. Markets are … Continue reading Fearing the Pandemic
Stocks are set to close on a great 2019. Year to date, global stocks are up well over 20%. US stocks have led and are making new all-time highs along the way. Fed Chair Powell has suggested no more rate hikes in 2020 and President Trump announced a "phase one" agreement in the US-China trade … Continue reading Full Circle
Bulls running high Markets exhaled a sigh of relief following the US-China trade truce and US stocks are retesting all-time highs. Like I wrote earlier this year, the new-highs are not a surprise and there could be even more upside if Chairman Powell delivers on anticipated rate cuts. Ironically, these new highs could signal a topping … Continue reading Burning Out
"Investing should be more like watching paint dry or grass grow. If you want excitement take $800 and take it to Las Vegas " - Paul Samuelson. Spoken like the Nobel Laureate he was, Dr. Samuelson's simple, timeless words of wisdom resound true until this day. Long-term investors should focus on fundamental data rather than … Continue reading Paint, Grass, and Data
The last two months have been choppy for stocks. The S&P 500 is down about 8% and has given up its gain for the year. Emerging markets have outperformed since October, relatively speaking, but remain the biggest loser YTD, down about 16%. As usual, the financial media is searching, desperately, for something to fear. Does … Continue reading Much Ado About Something
Volatility returns Stock market volatility is back. In February this year, the S&P 500 posted the largest single-day point fall in its history, only to rebound with the fourth largest single-day rise in history. All that volatility has some questioning if it still makes sense to invest in the stock market. S&P 500 BEST & WORST SINGLE DAY POINT … Continue reading Patience and Profits
US stocks are at all-time highs and many valuations measures suggest they are expensive. That doesn't mean the market can't keep rising and it's proven bears wrong for years. However, it's fair to say US stocks don't look cheap by traditional standards. It's actually getting hard to find any market that looks like a compelling … Continue reading Greed and Fear
US stocks are in one of the longest bull markets in history. Many are warning of extended market valuations. Two of the most highly regarded valuation measures seem to agree. The chart below shows Dr. Robert Shiller's CAPE ratio has reached levels surpassed only by the dot-com bubble peak in 2000. CAPE Ratio Source: Multpl … Continue reading No Market for Old Men
Cryptocurrencies like Bitcoin are the dish du jour. Everyone from seasoned investment managers to teen-aged kids wants a taste of the crypto. There's a good reason too, Bitcoin is up almost 300% in the past year alone. But price swings are extreme, enough to make even veteran traders squirm (both in pain and delight). The … Continue reading Bitcoin, Blockchain, and a Bag of Chips
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