Weekly Commentary

  We are now 40% of the way through earnings season. It’s a good time to take a quick look at how the scorecard looks—especially since we have seen much of our recent stock price appreciation driven by multiple expansion rather than earnings growth. [i] According to our friends at Bespoke, 65.5% of all companies […]

  Friday’s market action was some of the most severe to the downside we have seen in months. In fact, the 318 point drop on the Dow was the largest since June 20. [i] (Source: Bloomberg LP) The reasons for the sudden drop are really anyone’s guess. Some of the “talking heads” and prognosticators suggested […]

  As this calendar year unfolds it looks quite apparent market participants are in a bit of a tug-o-war. Markets have barely budged from the start of the year. [i] Equity investors are dealing with an interesting equilibrium point as it relates to valuations. According to Goldman Sachs, there is still some room for US […]

  The US economy added the fewest number of jobs in December (74,000) since January 2011. [i] Much of the blame for the terrible jobs report was the weather. I know the weather was horrific in parts of the country. We have a national clientele and plenty of anecdotal evidence. According to Phil Izzo and […]

In recent weeks we have seen some extraordinary data published by the federal government. It seems like our budget deficit (the amount of money the government has to borrow to meet its spending) has been shrinking at an astonishing pace. Contrary to what economists predicted as doom if the US Government cut deficit spending, the […]

  In the next several days you will begin to see a dearth of predictions about 2014. How much will the S&P 500 go up or down? How much will the US economy grow in 2014? Unemployment? Wall Street firms know one thing about us that we generally don’t realize. Investors are predisposed to avoid […]

  It’s the holidays and there is no better time to relax with family and friends. We have had an amazing year in the US equity markets. Source: Bloomberg The economy looks like it certainly reached “escape velocity” from the latest Q3 GDP revisions. GDP was up 4.1%. [i] Consumption even ticked up a touch […]

  The week before Christmas will certainly be anything but quiet for global equity markets. With the recent strong jobs report, stronger than anticipated Q3 GDP, and consumer confidence improving, some market prognosticators are now suggesting the Fed might begin to cut back on their bond purchases as early as this week. [i] While I […]

  Something happened last week in capital markets that might suggest a significant shift with investors thinking. The market sold off despite some very strong economic news all week—until Friday. Consumer credit expanded by 18.2 billion in October, which was the largest increase in 5 months. Revolving credit expanded by 4.3 billion, which was the […]

  At this stage of a bull market cycle we start to see investor behavior trump reason and logic. One of the most common behaviors/mistakes investors make is to chase valuations. They start to buy when in fact they should err on the side of caution. As I wrote last week, market cycles where price/earnings […]