In our last article we covered the Bubble in “Safe” Stocks, where investors are paying outrageously high multiples for companies that are believed to be more recession resistant such as consumer staples.  In this article I figured I’d cover a stock Mr. Market and the doom and gloom propagandists view to be “risky” based on...Read More

This morning we woke up to the news that JP Morgan has purchased the vast majority of the assets and deposits of First Republic with the help of the FDIC bank-funded insurance fund.  This deal removes the last lingering overhang from the panic-induced bank runs that we saw in early March, which led to the...Read More

On Friday several of the big banks reported earnings that were exceptionally strong, highlighting their strength in times of turmoil.  I believe that much of hysteria we saw in March was manufactured panic to a large extent.  Several horribly managed banks were taken out by bank runs and the problems were extrapolated incorrectly to the...Read More

Investors and market participants often get told that the way to get rich is buying quality companies or properties.  Firstly, it is important to define quality.  For many, quality is conflated with credit risk.  For example, U.S. government debt is often seen as having the least chance of a default than any other bonds, mostly...Read More

Volatility has begun to pick up in equity markets as bond yields have continued to creep higher, based on fears of higher for longer inflationary pressures.  I’ve warned before about being too aggressive in this environment.  Too many people expect equity markets to perform like they did in exceptionally low interest rate periods and that...Read More

In early 2023, we have seen a bit of a return of the speculative euphoria that was so pervasive in 2020 and 2021, which has driven up asset prices once again.  Market participants are more optimistic about things based on the belief that inflationary pressures are headed far lower, which should result in the end...Read More

We are in the early weeks of earnings season, and overall, the results have been quite impressive.  The banking sector saw continued improvement in net interest margins, with credit normalizing a bit.  One must remember that we are coming off the most enormous stimulus package in history in 2020, which created the best credit environment...Read More

Inflation and its impact on interest rates continues to be the driving factor in financial markets and the overall economy.  There are certainly signs of inflation slowing down in a practical sense, with what we are seeing in housing, as prices decline in many of the formerly hottest markets.  That will take time to show...Read More

The Huge Cost of Trying to Time the Market and Favorable Election-Year DynamicsToday I saw an interesting statistic that I wanted to share with you.  If you sold stocks at the bottom of each 10% selloff, and then bought back 10 days later, you’d miss out on over 2/3rds of the gains since 2002.  This...Read More

Last week we wrote to you about when to expect bear markets to end and we touched on the first day of big bank earnings.  Well, since then we’ve gotten earnings reports from Citigroup, Bank of America, Wells Fargo, Morgan Stanley, Goldman Sachs, and Ally Financial.  These companies have access to an enormous amount of...Read More