Economic Reports Scorecard The economic data the last two weeks was deja vu all over again. The US economy has been growing at roughly 2% the last three years and I see no reason - yet - to expect that is going to change any time soon in either direction. Certainly there hasn't been anything in the data to support [...]
I am raising the budget for risk assets this month. For the moderate risk portfolio, I am raising the risk allocation to 45%, reducing the bond allocation to 50% and adding a 5% cash position. The narrowing of credit spreads necessitated a move in the allocation as investors are clearly willing to take on additional risk right now. This is [...]
Economic Reports Scorecard The response to the much better than expected employment report today is quite interesting although not in a good way. Stocks will surely get most of the attention, assuming they continue to trade higher by the end of the day (they did), but other markets - bonds and gold - are not confirming the strength of the [...]
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 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 [...]
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 [...]
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 [...]
Economic Reports Scorecard Of the 19 reports released over the last two weeks for which we track a consensus estimate, only four were better than expected. And two of those were the two weekly jobless claims reports. The only other two better than expected reports were the Richmond Fed manufacturing survey and the personal income report. We had a run of [...]
One of the things I like about posts like the Chart of the Week is that it gets people to think, share and collaborate. It can be a bit of echo chamber sometimes so we welcome other opinions and feedback about our work. This chart of the week comes from reader Bradley Parkes, former investment banker and current geologist (Check [...]
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