The best scenario for investors is steady and low levels of inflation that ward off deflation but also discourage central banks from hiking rates too rapidly, says a Wall Street Journal article from last month. So far, the article asserts, “Trumpflation” has been embraced by deflation-fearing investors—but shareholders should be “keeping a watchful eye on […]
Along with its recent rate increase, the Fed has upgraded its growth and inflation forecasts—and this could bode well for commodity stocks, writes Validea CEO John Reese in in his article this week for Nasdaq. Reese cites a tighter labor market, stabilizing oil prices and slowing appreciation of the U.S. dollar as potential contributors to […]
The results of a study on asset performance during periods of both low and high inflation are presented in this month’s issue of AAII Journal by Craig Israelsen Ph.D and developer of the 7Twelve Portfolio The median level of inflation used was 3.29%, as it allowed researchers to divide the 46-year period between 1970 and 2015 in […]
As the S&P continues to hover at record high levels, the question remains as to how long it can continue. In a recent article for Forbes, Jurrien Timmer, Director of Global Macro at Fidelity Investments, outlines what he sees as five potential market scenarios down the road: Secular stagnation: The status quo—”a continuation of the […]
Rob Arnott, founder and chairman of Research Affiliates, says that the recent market environment is reminiscent of 1999, just before the tech bubble burst. Writing in Barron’s, Arnott argues that the following four “conditions parallel the extremes of the late 1990s:” “Falling inflation expectations,” which Arnott argues “snap back in reasonably short order.” He observes […]
A recent piece in Forbes offers 4 suggestions for beating inflation. After noting that “the present 0% rate [of inflation] blends an upward march of 2% in the cost of services with a collapse in the price of oil,” the article observes that “if commodities rebound over several years, 4% inflation could surface.” To protect […]
In an article in Canada’s Financial Post, columnist David Pett offers up some valuable investment insights from James Paulson, chief investment strategist at Wells Capital Management, who has been mostly correct in his stock market and economic calls since early in the bull market. Paulson explains that often, investors weight the consensus opinion in the […]
Billionaire investor Ron Baron has a message for those who are trying to predict how day-to-day news will impact the stock market: Stop.
Growth in US productivity has slowed considerably over the past decade, and explanations abound as to why. But Wharton professor and author Jeremy Siegel says the reality may be that new innovations have led to flawed data that underestimates just how productive the US has been.
Charles Schwab’s Liz Ann Sonders says that the risk of a correction is elevated, but she thinks the bull market is still in tact.
With the Nasdaq recently closing above 5,000 for the first time in a decade-and-a-half, bears have said that the index really should be adjusted for inflation to get a better assessment of where things stand, valuation-wise. Barry Ritholtz says that’s nonsense.
Contrarian guru David Dreman says policymakers have created “a form of financial Ebola” that is threatening to wipe out the savings of many Americans.
A periodic look through the archives of the greatest investor in history In Berkshire Hathaway’s 1979 Letter to Shareholders, Warren Buffett talked about the impact that inflation and taxes can have on an equity portfolio and a business. Below is an excerpt from the letter.
Contrarian guru David Dreman says the Federal Reserve has been playing a dangerous, unsuccessful game by keeping interest rates so low for so long. But he says there are ways for investors to cure the “easy money hangover.”
Inflation has been picking up lately, and in a recent Seeking Alpha column Validea CEO John Reese looks at how you can use the advice of Warren Buffett and Joseph Piotroski to keep your portfolio ahead of the inflation curve.