Category Archive

Summary The bond market is regaining its footing as inflationary pressures continue to wane, with investors showing confidence in improving conditions for the asset class. Favoring U.S. Treasuries over investment-grade corporate bonds and mortgage-backed securities is recommended for the second half of 2023 due to the current market environment. The yield premium for owning corporates remains thin relative to history, …

Investors are being provided with some meaningful signals for optimism as the sun brightens and the weather warms with the summer about to begin.  This does not mean, however, that we should be ready for blue skies from now on, as the blue days that made markets challenging at times over the last eighteen months may not yet be gone. …

“Sell in May and go away” is an age-old stock market adage.  It’s based on the principle that stocks historically have performed better during the period from November to April versus the stretch from May to October.  Does this maxim still hold up today? Meaningful historical outperformance. The notion of “sell in May and go away” does have merit.  For example, …

Summary The S&P 500 hit a new high for the year, but several signs of downside pressure continue to accumulate under the surface. U.S. mid-caps and small-caps are lagging, and the stock market rally has an increasingly narrowing breadth. The potential exists for this pressure to pull stocks back to the downside, but it also offers better entry points for …

Investors have no shortage of things to worry about in the current environment.  The threat of a looming economic recession, banking crises, and the ongoing debt ceiling debate are just a few of the current threats.  As a result, investors are understandably nervous about getting blindsided by a sudden and sharp downside move in the stock market.  Fortunately, the market …

As good as it gets?  The U.S. stock market has been in rally mode dating back to last October.  This includes an impressive bounce since mid-March in the wake of the collapse of a handful of major U.S. banking institutions.  The stock market resilience has indeed been impressive.  But despite these various positives, the path of least resistance for U.S. …

Summary If it keeps on rainin’.  It was nearly a century ago when the Great Mississippi Flood resulted in one of the most destructive and costly natural disasters in U.S. history.  One wonders whether another flood is threatening to break across the U.S. banking system and the broader economy today. Mean old levee.  Over the last two months, we’ve seen the failure …

Summary I recently had the opportunity to attend a two-day conference in Sarasota, Florida hosted by the Global Interdependence Center.  The topic was Cryptocurrency and the Future of Global Finance.  Given that it included some of the leading research and analysts on cryptocurrencies along with an address from Federal Reserve Board of Governors member Christopher Waller, the event provided a substantive …

The stock market has been remarkably resilient so far in 2023 despite a steady stream of challenging news.  Whether it has been persistently high inflation readings, a Federal Reserve continuing to raise interest rates longer and farther than expected, a set of sudden bank failures, or the lingering threat of arguably the most anticipated economic recession in history, the U.S. …

Summary It has been a recently tough stretch for traditional asset allocation strategies.  Prior to the start of last year, an investor with a long-term time horizon seeking to manage risk in the short run could capture the appreciation potential of stocks while offsetting the potential downside by blending in a meaningful allocation to bonds.  While such an approach had …