"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
It's the 19-year anniversary of the dot-com bust, and ironically markets are again awash in a deluge of fantastic IPOs. This time the fantasy has gone next level and involves a stampede of mythical unicorns. During the dot-com boom, it was unthinkable to value a pre-IPO company at over $1 billion (a unicorn). But as … Continue reading Chasing Unicorns
I wrote in December widespread market fear and pessimism in the US seemed like an overreaction based on fundamental data. To be clear, I don't think US stocks are a good bargain, and I prefer emerging markets anyway. But the YTD rally does support my view that the sell-off in Q4 was technical, and as investors pile … Continue reading Cracks in the Wall
From a Western perspective, many things about China are hard to understand. For example, a communist government with a market economy, or the "one country, two systems" arrangement between Hong Kong and the mainland. The Chinese stock market is even more confounding. Quotes flash red on upticks and green on downticks. There are more share … Continue reading One Country, Many Reasons
'Twas the eve before Christmas and not a Santa rally in sight. Year-to-date the S&P 500 is on the cusp of a bear market, closing down -19.78% from its all-time high of 2,930.75 in September. The sell-off began in October and has been swift and fierce, summoning flashbacks of the S&P 500's harrowing drawdown of … Continue reading Fear and Santa
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
Time for Turkey? The Holidays are almost here, but no, I'm not writing about your upcoming Thanksgiving dinner. I'm writing about a Turkey with Lira that's down 90% against USD and an equity market that's down 70% from its highs. TUR data by YCharts When others are fearful Emerging market equities have sold off broadly year-to-date. … Continue reading Time for Turkey?
Longest ever? The US stock market closed August to the accolades of "the longest bull market in history." By some measures, the S&P 500 achieved its longest rally ever. Then again, by other measures, it did not. S&P 500, 1927 to 2018 Monthly close, inflation adjusted. Souce: MacroTrends.net There's a lack of consensus on how this … Continue reading Actually, Technically, the Longest
Emerging markets are down close to 7% YTD as of the end of July. The reasons are various -- rising interest rates, softening economic data, and US tariffs to boot. Unrecognized headliner China is on the front page because of the trade war and its equity market was down over 20% from its YTD highs. … Continue reading Keeping it Real
A nod to The Fat Pitch blog for an excellent reminder of why macro still matters. In an age of fast money and high-frequency-trading, macro considerations may seem too slow and antiquated to be relevant. But as I wrote in my very first post (and many times since), it would behoove us to remember that financial markets … Continue reading Macro Matters
