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.
Could 2014 finally be the year that long-simmering inflation fears boil over? Wells Capital’s Jim Paulsen thinks it just might be. “In the last five or six years we’ve been worried about nothing but deflation and weak growth,” Paulsen tells Yahoo Finance’s Breakout, “so it’s very difficult to imagine that we might get to a […]
Jeffrey Gundlach thinks interest rates will soon rise, but, unlike fellow bond guru Bill Gross, he doesn’t think inflation is upon us. Gundlach, in a web seminar, recently said that a paradigm shift has occurred in the past five years or so, according to AdvisorOne. “Over the majority of the [past three decades or so] […]
Top fund manager Mihir Worah of PIMCO says not to be lulled into complacency by the low inflation we’ve seen in recent years. “We expect global inflation over the next three to five years — or even the next five to 10 years — to be higher than it has been over the last 20 […]
Hedge fund guru David Einhorn says he increased his bullish bets last month, but remains concerned about several issues, including the Federal Reserve’s low-interest rate policy. In a conference call with Greenlight Capital Re investors, Einhorn said that he increased his bullish positions thanks to better-than-expected corporate earnings results, Bloomberg reports. But, he added, “This […]
Last week, we highlighted a MarketWatch column that referenced a new study showing that stocks, against conventional wisdom, have actually served as poor hedges during periods of marked inflation. But a closer look at the study shows that that is far from the whole story. The study was performed by Elroy Dimson, Paul Marsh, and Mike […]
In his latest column for RealMoney.com, Validea CEO John Reese says inflation can be a big hindrance to good investing returns, and highlights one industry — pharmaceuticals — that has the power to beat back inflation. “If inflation were Wile E. Coyote then its Road Runner might well be the pharmaceutical industry,” Reese writes. “An […]
Conventional wisdom is that stocks are a good hedge during inflationary periods. But some prominent financial researchers say the belief is off the mark. “When inflation has been moderate and stable…equities have performed relatively well,” Elroy Dimson, Paul Marsh, and Mike Staunton of the London Business School write in the 2012 Credit Suisse Global Investment […]
Over the past few years, investors have poured into low-yielding Treasury bonds, perceiving them as the safest place to be during the global economic tumult. But, according to Warren Buffett, bonds are one of the most dangerous places for investors to put their money over the long term — and that’s not going to change. […]
Highly-rated strategist Francois Trahan says that “deflation” is not a dirty word, and that the Federal Reserve could help the economy by allowing deflation to stem commodity price inflation that is “eroding people’s pockets”. Trahan says Fed members and other policymakers and economists are relying on economic principles that aren’t relevant right now. Three main […]
Interest rates and inflation have a much greater role in stock market valuations than you might think, and that means the stock market is on a “very dangerous” path, according to Rob Arnott. In an article for Morningstar, Arnott, of Research Affiliates and PIMCO, looks at the relationship between stock market valuation levels, interest rates, […]
While many investors have been fleeing stocks this summer, David Dreman says it’s a good time to be buying. “No, the market volatility and the seemingly never-ending Fed follies are certainly not what makes me positive on stocks today, but there are some good reasons to be bullish right now,” Dreman writes in his latest […]
Investors may spend a lot of time fretting over whether their portfolios are going up or down. But, despite all of the advances in stock market data availability, many may not be getting an accurate picture of what their portfolios are really doing, says The Wall Street Journal’s Jason Zweig. According to Zweig, after last […]
Saying that a “3-D Hurricane” — debt, deficits, and demographics — is lingering on the horizon for the U.S., Rob Arnott is taking several steps to prepare his portfolio for an inflationary climate. Arnott tells MarketWatch.com that the U.S. budget deficit is worse than many think, if you include entitlement program costs like Medicare, Medicaid, […]
Top-performing fund manager David Winters says many investors are overlooking some great bargains beyond the U.S.’s borders. “The most compelling opportunities are no longer in North America but in companies domiciled overseas or focused on the world beyond the U.S.,” Winters said at InvestmentNews’ 2011 Retirement Income Summit. Winters said he has 75% of his […]