Recently, retail investors have started chasing small-cap stocks in hopes of both a rate-cutting cycle by the Federal Reserve and avoiding a recession. Such would seem logical given that, historically, small capitalization companies tend to perform best during the early stages of an economic recovery. The recent exuberance for small-cap equities is also unsurprising, given […]
Don’t fear all-time highs in the market. Such is a natural response for investors who are concerned about market risk. However, rather than fearing market exuberance, we must understand what drives it. There is an essential concept investors should understand about markets when they are hitting “new records.” “Record levels” of anything are “records for a […]
Regarding the surprisingly strong employment data, Fed Chair Powell said the quiet part out loud. The media hopes you didn’t hear it as we head into a contentious election in November. Over the last several months, we have seen repeated employment reports from the Bureau of Labor Statistics (BLS) that crushed economists’ estimates and seemed […]
While the bulls remain entirely in control of the market narrative, divergences and other technical warnings suggest that becoming more cautious may be prudent. In January 2020, we discussed why we were taking profits and reducing risk in our portfolios. At the time, the market was surging, and there was no reason for concern. However, […]
The cost of housing remains a hot-button topic with both Millennials and Gen-Z. Plenty of articles and commentaries address the concern of supply and affordability, with the younger generations getting hit the hardest. Such was the subject of this recent CNET article: “The housing affordability crisis means it’s taking longer for people to become homeowners […]
In September 2021, I discussed how the markets had set its sights on the S&P 500 index hitting 5000. To wit. “Yes, the rally off the COVID-19 bottom in March 2020 has been extraordinary, but we think there are further gains ahead. Solid economic and corporate profit growth, in conjunction with a still-accommodative Fed, means […]
As the financial markets grind higher, retirement savers have consciously decided to add more to equity risk. Such was the result of a recent Bloomberg survey. “Retirement savers want more stocks in their portfolios as a hedge against inflation, potentially offering a long-term tailwind for equities as societies age, according to the latest Bloomberg Markets Live Pulse survey. Almost […]
I received an email this past week concerning George Soros’ “Theory Of Reflexivity.” “I am not a fan of Soros, but this market has the look and feel of the dot com bust of 2000. In a few short words, the AI investment phenomenon is feeding on itself just as the internet and fiber did […]
As money market account balances soar, the mainstream media again proclaims, “There is $6 trillion of cash on the sidelines just waiting to come into the market.” No? Well, here it is directly from YahooFinance: “The growing pile of cash in money market funds should serve as a strong backstop for the stock market in […]