What a terrible month for the equity markets.  As I write this, the Nasdaq looks set to close down 12.% for April, which is its worst monthly performance since October of 2008, which was when we were seeing some of the worst developments of the Financial Crisis.  The index is now down more than 23%...Read More

I hope that all of you who celebrate had a wonderful Easter last week. I just wanted to provide a quick update, as the markets have been quite tumultuous of late. We are done with Big Bank earnings for the 1st quarter of 2022.  The overall message was enormously positive.  Both consumer and commercial credit...Read More

2022 is shaping up to be quite the crazy year.  While this horrible war in Ukraine dominates media headlines, I can’t help but feeling like inflation might be the dominant theme of the next decade.  Using “government” numbers, inflation is running at about 7.9%.  Shelter is the single biggest component of CPI at 33% of...Read More

Yesterday’s CPI report showed prices up 7.9% YoY, which was the highest reading since 1982.  Even more concerning, this was before the impacts of the Russian/Ukraine war is reflected in the data.  Market volatility is exceptionally high and pessimism is quite pervasive.  There are legitimate fears that inflation in excess of wage growth could cause...Read More

The Nasdaq is now officially in a bear market as defined by a 20% decline from the highs, while the S&P 500 and Dow Jones indices are in corrections, with losses greater than 10%.  The Russian invasion of Ukraine and the economic sanctions brought against Russia in response are a major deal for the global...Read More

Heightened concerns about military conflict between Russia and Ukraine have rattled markets the past two weeks. Just today, the S&P 500 was down 2.12% and the Nasdaq was down 2.88%.  The 30 second version is that Russia wants assurances that Ukraine won’t join NATO and has long-term cultural affinity with the territory.  Ukraine wants its...Read More

Today we got the latest update on the Consumer Pricing Index (CPI) and it was a doozy, showing annual inflation of 7.5%.  As you can see on the image above, the Real Fed Funds Rate (Fed Funds Rate Minus CPI) is now a negative 7.4%, which is the lowest since 1974.  This means that money...Read More

I’ve been writing a lot about elevated valuations for equities and the absolutely horrid risk/reward in almost all bonds.  I’ve kept the same graphics at the top of this email for the last month as I want to emphasize the importance.  We’ve also covered inflation, which is rearing its ugly head, with the September PPI...Read More

Today the Case/Shiller housing price data came out and it showed prices up nearly 20% YoY. Brent crude oil touched $80 per barrel and is on course for its best month since February. Treasury yields have risen quite dramatically over the last week, with the 10-year now above 1.5%, the highest since June.  Natural gas...Read More

Rob Arnott of Research Affiliates is one of the best investment strategists around. He wrote a fantastic article on the opportunity in value investing, so instead of going on about it, I’m just going to let you read it to get a good grasp of the opportunity in front of us.  Here was one quote...Read More