Political issues shouldn’t play a large role in long-term strategy
Client letters and investment updates
Based on Russell Investments 2017 study
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Bonds sink as investors bet on an improving economy and value priced stocks.
In July, the stock market continued to rebound from the Brexit correction and experienced a rotation back toward large and medium capitalization growth stocks.
Stocks continue rebound from January funk, but bonds flat in May. Return expectations flat lining after post crisis run.
This is an unbiased comparison of the proposed tax plans for individuals released by Hillary Clinton and Donald Trump. In many ways, their tax policy aligns broadly with the platform of their political party — Clinton wants high-income earners to pay a larger percentage of their income in taxes, while Trump wants to cut taxes for all income levels.
Midsummer Night’s Market
The good old days, when politicians were civil and worked together, market risk was null, and stock market volatility was low
June 24, 2016
I have no doubt the markets will process Brexit over ensuing days and weeks, and there will be additional volatility related to the announcement. But it will take years for Britain to actually exit the EU, plenty of time for businesses and markets to adapt.
Stocks continue rebound from January funk, but bonds flat in May. Our view on market valuations and likely returns. The important dimension of inflation.
Take this to the bank. If indeed we are in a moderate return environment, then the margin for error is smaller, and it is more important than ever to invest in index funds, keep costs low, and to avoid both inertia and opportunity costs associated with active management.
The trade deficit has become a political football leaving many with the perhaps misguided notion that our trade deficit with countries like China and Mexico makes us a loser. As with many things economic, it ain't that simple. Arm yourself with the facts:
The stock market is a lot like weather in New England – wait a few minutes and it will surely change! In late February, as the wintry weather waned, Wall Street waxed, climbing a proverbial wall of worry.
Investor Sentiment now supportive of a market bottom
The day after posting Market Corrections: Separating Fact from Fiction, I was tickled to see this great article by Robert Shiller about how popular narratives, however unfounded, influence stock prices.
Some additional thoughts on the January market swoon and on Alan Blinder's WSJ article -- The Markets are Scaring Themselves
What it Says About the Way Our Economy is Changing
Great article by Michael Porter of Harvard Business School about the importance of GE's decision to relocate its headquarters to Boston, not just because of what GE brings, but because of why it is coming.
GE's transformation over the last decade reflects how manufacturing is changing, the good things that portends for our economy and our competitiveness in global markets, but also the disruption it brings. Increasingly, the have and have not's will align along those who embrace change, and those stuck in old ways of thinking.
This has powerful implications going forward for our human capital -- one of our most valuable assets.
The best advice is too boring for TV, and not profitable enough on Wall Street.
Given recent weakness in the stock market, and financial media’s tendency to magnify every normal wiggle, this is as good a time as any to revisit some long term perspectives, and some of the do’s and don’ts of a market correction.
