The new tax law is in effect and there are changes to be considered. Spoiler alert, tax discussions can be sleep – inducing. You are forewarned! The standard deduction – the amount that all tax filers can deduct from their income each year – was doubled to $12,000 for single filers and $24,000 for joint […]
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Remember the Big Picture…
All seemed good when the S&P 500 reached an all-time high on September 20. But by October 29, we were 9.9% lower, with a lot of up and down in between. Gulp? Yikes? If the market has been unnerving you, we understand. For one thing, before October, we enjoyed some pretty smooth sailing, and when […]
Rising Rates – The Good, The Bad and The Ugly…
Investors sitting on cash over the last several years finally have something to cheer about. Interest bearing deposits have inched up steadily over the last year with many today yielding over 2.0%. Unfortunately, these higher rates are not good news if you are the U.S. government, one of the biggest borrowers around. U.S. debt now […]
The 2-Minute Thought: Handling Investment Pain
I really enjoyed a recent blog by Cliff Asness of investment firm AQR Capital. It’s called “Liquid Alt Ragnarök?” and it’s on how to deal with the intense pain of investments going badly. Liquid Alt is the name of AQR’s investment strategy. It’s explained in the paper, but that’s not the important part. The important […]
The 2-Minute Thought: Extreme Stock Price Reactions
Recently, there have been some pretty extreme stock price reactions after earnings announcements. Why would Chinese test prep company New Oriental Education trade down by 17% after announcing a negative 2% earnings surprise — while the shares of apparel company VF Corp see a drop of 11% on a 9% positive earnings surprise and higher […]
Is Globalization Dead?…
The simple answer is no, globalization is not dead but we have to add some big caveats. President Trump wants to re-shore jobs lost to globalization in the 80’s, 90’s and 2000’s. If America can bring manufacturing back then we will be strong again. At least this is the theory. The problem, however, is that […]
Financial Freedom Under FIRE…
There is nothing new under the sun when it comes to financial planning. All you really need to know is that you should spend less than you make – at least that is what Benjamin Franklin believed. But much like diet fads, there will always be a new theory on how you can gain financial […]
What Amazon Has Done To Us…
The “Amazon Effect” usually refers to the way Amazon completely disrupted the retail market. It pushed some bricks-and -mortar competitors out of business and knocked others off their feet for a bit until they could regain their bearings in a changed world. It didn’t matter if a company competed directly against Amazon or not. By […]
An Approach that Still Works…
Investors’ love affair with bonds has likely come to an end. The yield on the 10 year U.S. Treasury bond peaked at just under 16% back in 1981. Over the next 35 years, this rate dropped continuously reaching a low of 1.375% in the summer of 2016. This decline fueled perhaps the longest bull market […]
The 2-Minute Thought: Sticking with Emerging Markets
If you own emerging market stocks, you know it’s been painful this year. The chart below from McKinsey shows just how wide the divergence has been between emerging markets and the stellar S&P 500. Source: McKinsey Global Institute To say that emerging markets are out of favor now is a bit like saying water seems […]
The 2-Minute Thought: Geopolitical Risk Declining?
Believe it or not, attention to geopolitical risk seems to be declining — in spite of trade tensions, saber-rattling between the U.S. and China, and emerging markets turmoil. That at least is according to BlackRock and its quantitative tool, the BlackRock Geopolitical Risk Indicator (BGRI). The BGRI attempts to measure the amount of attention geopolitical […]
Time To Question The Middle Kingdom?…
I have been an admirer of China’s growth for a long time. The doomsayers predict it will come to an end and maybe soon, but with a nearly forty-year track record of solid results, I will stick with China until they stumble. Call me stupid. However, today there may be reasons for me to second […]
