The FED’s “protect the market at all costs” attitude minimizes the risk of a severe bear market but increases the risk for an inflationary environment. Trade deficits and low productivity are not good signs for the long-term, no matter the positive data from the labor market. Until the focus shifts from central banks to real… Read More »The Important Insights From The FOMC Minutes No One Is Talking About
The dollar has been positively correlated with stocks for the last 4 years which is unusual. Potential FED interest rate increases don’t make international diversification a great idea right now. Any sign of a U.S. recession should be a good time to think about international diversification with emerging markets. Introduction On big news sites like Bloomberg you… Read More »The U.S. Dollar: Should You Stick To It Or Diversify Now?
Signs of Fragility in the Economy Point to an Impending Bear Market. What To Do Now To Protect Yourself.
The last jobs report was good news but it also indicates higher costs and full employment. An “easy to hire, easy to fire” mentality is in the air. Healthcare, cash or short term trades should be the best options in this situation. Introduction Last week the Nasdaq and S&P 500 reached yet another record high.… Read More »Signs of Fragility in the Economy Point to an Impending Bear Market. What To Do Now To Protect Yourself.
Risks are cumulating and getting bigger. U.S. GDP growth is slower than expected, earnings and oil prices continue to decline. Japan is unable to grow while BREXIT risks are still unfolding. Introduction It is difficult to find good news lately. The last really good news was the June jobs report when 287,000 jobs were added.… Read More »Euphoria & Denial Point to the Last Days of the Bull Market
Housing is showing inflationary signs but still offers an opportunity to profit from the rising trend as a downturn is unlikely and not expected in the short term. Amidst all the positive news, manufacturing turned negative. Yet despite this, stock valuations keep going up, increasing the risk. In the week ahead: the FED’s decision and… Read More »The Economic News is Very Good, But Keep An Eye On the FED and GDP This Week
Rates cannot go lower but higher rates would destroy wealth and lead to a recession. The FED is in a difficult position and rhetoric shifts can be expected. Introduction It is every central banker’s target, the elusive 2% rate of inflation. We cannot know when, but should expect that it will be achieved and prepare… Read More »Higher Interest Rates Aren’t A Given, But Investors Should Prepare Anyway. Find Out Why.
Bonds are becoming riskier as yields are falling. Inflation is at 1.2% and very likely to get higher as full employment is approached. The FOMC predicts stability which could create a great environment for traders. Introduction On July 6 the Federal Open Market Committee (FOMC) June meeting minutes were released. As they give clear insight… Read More »Watch Out: The FOMC’s Current Stance Could Impact Your Portfolio in the Long Term
The risks of a slowdown are higher than the upside. Fundamental trends are negative in advanced economies while emerging markets show higher growth rates and are cheaper. It is important to create a diversified portfolio with uncorrelated assets. Introduction In an environment where it seems maximum potential for the U.S. economy has been reached, the… Read More »How to Prepare Your Portfolio For The Next Recession or Stock Market Crash
A positive outlook seems more political than realistic as the FED is out of maneuvering power. Keeping interest rates unchanged is the best and the only thing the FED can currently do. Low interest rates will weaken the dollar, boost exports and increase corporate earnings in the upcoming earnings season. Introduction In FED’s Chairwoman Yellen… Read More »Will There Be A Long Term Impact To The Fed’s Shift In Rhetoric?
An aging population diminishes GDP growth and US GDP growth is bound to further decline. Fertility rates are at an historical minimum and the labor force participation is falling. Corporate earnings growth is correlated to GDP growth. Introduction One of the worries for the stock market apart from interest rates and a slump in commodity… Read More »Time To Get Smart About Stock Picking – Find Out Why