Government investments rarely work out the way they are supposed to. From Solyndra to California's High Speed Rail project to the Big Dig to the UK government selling off gold at the lows at the turn of the century, governments just aren't very good at the investment thing. The UK gold selling incident is perhaps the best example of government [...]
I skate to where the puck is going to be, not where it has been. Wayne Gretzky I took my wife to dinner Saturday night at a local, boutique hotel. The Willcox Hotel was established in the late 19th century to cater to the Winter Colony of wealthy northerners who spent their winters in South Carolina. Today it still caters to [...]
Longer term, I think there are more significant reasons to expect a weaker dollar, starting with our politicians’ (of both parties) newfound infatuation with industrial policy. Government-directed investment may create activity but long-lasting benefits have, in the past, proved quite elusive. The real problem with our government deficits and debt isn’t the debt itself but rather what the borrowed money [...]
How far can this rally go? Should we be locking in some gains? That's a paraphrase of questions I've been getting from clients recently. It does seem as if the stock market goes up every day and with all the ups and downs of the last few years, it is natural to wonder if we're about to get another bout [...]
Nvidia reported earnings last week and they were, to be sober about it, incredible. Total revenue rose to $22.1 billion for the quarter, up 22% from last quarter and 265% year-over-year. Data center revenue, which is what investors really ought to be watching with this company, was up 27% from last quarter and a whopping 409% year-over-year. Gross margins run [...]
Reports that say that something hasn't happened are always interesting to me, because as we know, there are known knowns; there are things we know we know. We also know there are known unknowns; that is to say we know there are some things we do not know. But there are also unknown unknowns—the ones we don't know we don't [...]
When I sat down to write this week's commentary, my intention was to write - again - about the valuation of the stock market and particularly the S&P 500. And even more specifically about the top 20 stocks, which make up 42% of the index, and trade for an average forward P/E of 27.5. It is an expensive bet on [...]
The ISM manufacturing survey has been below 50 for 15 months in a row and sits today at 49.1. This survey, along with a lot of other manufacturing data and anecdotes, has been cited repeatedly by the economic bears as evidence we are heading for recession. That, of course, hasn't happened and that is consistent with this indicator. Yes, below [...]
At the beginning of the year, the market was pricing in fairly high odds of as many as 5 interest rate cuts by the Fed this year, the first one coming in March. Now, just a month later, March appears to be off the table with the odds of a cut down to just 23.5% today. May still shows a [...]
The 10-year Treasury Note yield fell 13 basis points last week, a move that would not normally rate any mention whatsoever, but the path of that small decline does. From Monday to Thursday, the yield fell, from high to low, by 34 basis points, a move that added 1.3% to bond prices (Aggregate bond index) in four days. In a [...]
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