“Begin With the End in Mind” Stephen R. Covey, Author Although, Stephen Covey was not referring to investments when he assigned this declaration as Habit #2 in his book, “The 7 Habits of Highly Effective People”, it seems applicable to the anticipatory nature of portfolio management. “The ability to envision in your mind what you cannot at present see [...]
The risk budgets are unchanged again this month. For the moderate risk investor, the allocation between risk assets and bonds remains at 40/60. I struggled more with this decision than any in recent memory but in the end there just isn't sufficient evidence to make a change. Raising or lowering the allocation to risk assets right now would require making [...]
Economic Reports Scorecard Concern about recession is growing again as formerly strong portions of the economy turn down. The last two weeks brought reports of new weakness in the labor market, continued slowing in construction and renewed weakness in manufacturing. Auto sales were also weak based on the reports from individual manufacturers. The state of auto sales is frankly a [...]
This week's chart comes to us from Ned Davis Research via this article on MarketWatch: What that bottom pane shows is that the median price to sales ratio for the S&P 500 is about 2.2. That is higher than in 2000, which was about as obvious a bubble as one is likely to ever see. But....there are big differences between [...]
Economic Reports Scorecard The standout reports from the last two weeks are mostly real estate related. The Housing Market Index kicked things off two Mondays ago with a solid reading of 58 (this is a sentiment index with 50 as the dividing line between positive and negative). Homebuilders are not gaga with optimism but this number has been fairly consistent [...]
The short term leadership is shifting as the dollar comes off its lows. Energy and materials had been leading the market during the recent period of dollar weakness. As the dollar found its footing over the last month, defensive sectors took the lead. Whether this short term shift continues will likely depend on whether the Fed is right about the [...]
Back in mid-April the chart of the week asked if commodities had made a bottom. The answer was maybe in that the short and intermediate term had turned positive but the long term monthly chart had yet to trigger a buy signal. That hasn't changed by the way. If you read my Global Asset Allocation updates you know I added gold [...]
“Patience is the ability to idle your motor when you feel like stripping your gears.” Barbara Johnson, Author After a swift decline in January, a flat February, a strong turnaround in March and a pretty flat April, investor patience is starting to wear thin. It seems ever more difficult to discern a direction for the markets and the economy. [...]
Economic Reports Scorecard The tone of the economic reports improved over the last two weeks with quite a few releases coming in better than expected. From a scorecard viewpoint, we had 6 reports better than expected versus 8 worse than expected for the reports where a consensus can be tracked and interpreted. (Note: sometimes it is hard to classify a [...]
The risk budgets are unchanged again this month. For the moderate risk investor, the allocation between risk assets and bonds remains at 40/60. It was tempting to raise the risk allocation this month and up our allocation to the weak dollar investments we've favored for some time. But the only indicator that really improved was credit spreads and it was not [...]
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