2019: The Year Ahead
At the beginning of 2019, as the dust settles after a punishing several months of losses in equity markets in last year’s final quarter, the question on everyone’s mind is what happens next. If you are a typical investor looking to make the most of your financial resources towards a...
Who is ‘MyRA’?
In the State of the Union address given on January 28th President Obama introduced the world to ‘MyRA’, a new retirement savings vehicle intended to help the middle class save for their future. This is commendable: a retirement gap of six trillion dollars exists between what Americans should be saving...
MVCM Midweek Market Comment: Election Fever Breaks, Eurozone Jitters Return
Now that the election is over and done with, US investors have turned their focus once again to the looming fiscal cliff and deepening recession in Europe – and their reaction has been anything but kind. At close on Wednesday, the Dow Jones Industrial average was down a whopping 313...
Midweek Market Comment: Debate Over Jobs?
Every month for the past three years, economists and financial professionals everywhere have waited with bated breath to hear the U.S. employment reports – economic indicators that offer insight into the current economic state of the country. Lately though, these reports have provided more confusion than clarity. Payroll Processor Automatic...
Midweek Market Comment: Floors, Ceilings and “Kick the Can”
We talk a lot about floors and ceilings these days – so much so that readers may be forgiven for thinking that we are carpenters. No – our floors and ceilings are of the electronic variety. Over the past several weeks we have seen the floor in action, with central...
Midweek Market Comment: Competitive Easing
The aftermath since the Fed’s announcement of QE3 last week has been settled and somewhat unremarkable. As one would expect, investors have trimmed some of their equity positions after the initial rally following the announcement, but overall there has been no real drawback in risk asset markets. However, warnings related...
Midweek Market Comment
After a somewhat lackluster first few days in September, global markets have rallied today on strong U.S economic reports and details on the ECB’s plans to help struggling European bond markets. Although the August employment report will be reported on Friday (9/7), markets have reacted positively to the Private Sector...
200 Days of Tea Leaves
As of the writing of this post the major markets are all in 2%-plus territory for no particularly solid reason – in other words, business as usual for the tea leaves readers who are back in the saddle as the world of risk on / risk off solidifies its return...
Weekly Market Comment: Occupy Eurozone
As of this writing it is too early to tell how the most recent curve ball thrown in the ongoing Eurozone debacle will turn out. The referendum proposed earlier this week by Greek premier George Papandreou caught the world by surprise. Actually, to employ the terminology now in vogue and...
Midweek Market Comment: It’s Ben Week Again!
We humans are generally in the habit of marking off the annual calendar by milestone events that help give some structure to the otherwise random passage of time. At this time of year back-to-school vibes are in the air. But before we get to Labor Day there is another Big...
Special Market Comment: Relatives and Absolutes
A great deal has been said over the last three days about the S&P downgrade of US government debt. Much of this chatter has been wearily familiar as the usual actors who reside in Versailles-on-the-Potomac recite from the predictable scripts of blame and false sanctimony. Let’s get straight to the...
Learning to Ride
Remember what it was like learning to ride a bike? Most of us went through a similar experience. First came the tricycle – safe, sturdy and close to the ground. Then the training wheels – now we were further off the ground, and maybe Dad was a little further away...
Midweek Market Comment: Safe Haven Economics 3.0
As these words come to page we are six days away from August 2, the supposed drop-dead date for the US government’s running out of money and, for the first time since 1790, being unable to meet all its financial obligations. Right now it is hard to see the entrenched...
Murdoch, Markets and Mistrust
Over the past several days we have been treated to the spectacle of an unsavory phone hacking scandal that has metastasized into a full-blown politico-media scandal shaking the upper-crust branches of the British governing class, forcing a reluctant humility on the pashas of an arrogant media empire and making threatening...
Midweek Market Comment: Pandora and the Zombies
In the time-honored Greek myth Pandora, blessed by the gods with abundant beauty and talent but also an overweening curiosity, opens the box and allows all the Ills to pour out into the world. In her despair Pandora quickly shuts the box but by then there is just one thing...
Midweek Market Comment: A Slow-Burning Funk
Some market corrections are like sudden hysterical meltdowns – dramatic and immediate. They erupt and send everyone to man the panic stations – and then just like that they are over. Investors come wading back in to snap up bargains and the world moves on. Most of the market corrections...
Midweek Market Comment: Europe’s Woes
Just two months ago the beleaguered second-tier European economies were the darlings of global equities. As of March 25 the MSCI Greece country index was up 22.9%, while Spain, Portugal and Ireland were all turning in double digit performances. Their debt problems hadn’t gone away, but investor sentiment appeared predisposed...
Midweek Market Comment: Peccadilloes, Policy and Prognosis
It’s not like we didn’t have enough to worry about, after all – tepid economic growth, budding asset bubbles in debt and commodities, and sundry debt crises are more than enough thank you very much – so why did the head of the IMF have to go and wind up...
Midweek Market Comment: The Performance Paradox
“May you live in interesting times” goes the ancient Chinese saying – whether a blessing or a curse is presumably up to the individual. 2011 has been a most interesting year so far from the standpoint of financial markets. It has been a good year for many asset classes from...
Special Market Comment: Japan and the World
Twenty years ago I was a Tokyoite – a gaijin (expatriate) living in a delightful little neighborhood called Shimouma and working for an American investment bank in the buzzing financial district of Otemachi, where our 10th floor office had a view over the Imperial Palace and where on a clear...
Midweek Market Comment
Believers in the “January Effect” would be heartened by the first trading day of 2011, which saw equities indexes around the world jump by more than one percentage point. What ensued was actually a fairly lackluster week for most markets. The US and a handful of Asian markets ended the...
Technical Comment: Return of the Eurojitters
One way to visualize what is happening in this latest round of Euromarket jitters is to look at the present disparity in returns among European stock markets. Sweden and Denmark, both non-Eurozone countries (i.e. they continue to use the Swedish krona and Danish krone respectively), are at the top of...
This Week in Global Markets: Technical Comment
Two events of considerable and related importance took place last week. The 2010 US midterm elections produced a seismic shift in the balance of power of the legislative branch, from Democrats to Republicans. And the Federal Reserve announced its long-anticipated plan to embark on a new program of quantitative easing....
This Week in Global Markets
Things to Watch Existing home sales on Mon 10/25 (update: up 10%; higher than expected) Case-Shiller home prices on Tues 10/26 (update: down 0.2%; lower than expected) Consumer confidence index on Tues 10/26 (update: increase to 50.2%; close to expectations) Durable goods orders on Wed 10/27 New home sales on...
This Week in Global Markets
Things to Watch Report on international trade balance due out Thurs 10/14 Producer Price Index report due out Thurs 10/14 Consumer Price index report due out Fri 10/15 Earnings announcements this week: Intel, JPMorganChase, Google, GE On the Menu: This Week in the Public Discourse “Bad but not so bad”...
Technical Comment: Basel III and Much Ado about 2019
The latest entrée offering itself up to the financial chattering classes for tasting and appraising is Basel III, the new incarnation of the capital adequacy guidelines financial institutions are supposed to follow to protect against losses in their risk assets portfolios. The heart of Basel III consists of stricter reserve...
Earnings and Confidence
Here is a perfect little encapsulation of the schizophrenic market environment we currently inhabit: with the earnings season in full swing 86% of S&P 500 companies reporting to date have beaten expectations, including a bevy of consumer heavyweights like Apple (as my colleague Masood Vojdani pointed out in his blog...
The Week Ahead: The Market’s Dog Days
The dog days of summer are upon us. We all have different ways of marking our seasonal calendars: my own “dog days” typically kick in after the July 4th holiday and the Wimbledon tennis finals, knowing that the next combination of a long weekend and Grand Slam tennis tournament will...
Midweek Market Comment: The Market’s Exquisite Philosophical Dilemma
For the last month or so the market has exhibited two qualities: volatility and aimlessness. After another drop of more than 2.5% today the Dow and the S&P 500 were back to roughly their lows of May, when they first entered technical correction territory from the cyclical highs reached in...
The Week Ahead: The Friday Flop Continues and Japan Feels the Pain
The week began on a sour note, adding to last Friday’s 324-point selloff on the Dow as the 3:30 Club knocked another 115 points off the index today. The return of volatility has been a generally negative story for global risk assets, most of which are considerably down from where...
Midweek Market Comment: Germany and the EU
“It is a question of survival” intoned German Chancellor Angela Merkel upon announcing a ban on naked short-selling in Germany and driving home her support for still-tougher regulatory measures to bring stability to financial markets. Merkel went on to denote the current crisis facing the Eurozone as the single largest...
2009 Intermittent Market Commentary
Nature abhors a vacuum. While we ponder the meaning of data points suggesting that the worst of the financial meltdown may be behind us, we also have to look forward and consider what comes next. The days of heart-wrenching freefall have subsided, for the time being at least, but for...
Understanding Alternative Assets
We define “alternative assets” as follows: (a) assets whose fundamental intrinsic properties are different from those of traditional equity and fixed income securities, and/or (b) poolings of assets – which poolings may include traditional equity and fixed income securities – such that the return-risk-correlation characteristics of the pooled assets are...
Emerged Markets
What do the following statistics have in common? - 98% of total geographic land mass - 95% of total labor force - 98% of total proven oil and natural gas reserves - 76% of total electricity consumption - 80% of total real (purchasing power parity) GDP Answer: they are all...