Sigma Signals

Week of September 26, 2022 Bear markets are designed to generate maximum emotional discomfort. At the moment of complete despair is the capitulation that results in the panicked sale of investments. With a cyclical bear market in equities now largely confirmed, future return expectations have improved, and as such, additional investment is warranted. Our equity … Continued

Excess Capacity

Excess capacity is a condition that occurs when demand for a product is less than a business or industry could theoretically supply.  While this term is typically used in manufacturing, excess capacity can be applicable in a wide range of activities.  It may seem strange to be writing about excess capacity when all the news … Continued

Sigma Signals

Week of September 19, 2022 The more things change, the more they stay the same, or so it appears after surveying the financial and economic landscape over the last week. From a broad view, stocks largely declined about 5% and interest rates increased a few basis points. Bob Bilkie, CFA

A Reprieve For Nuclear?

The US, France, Germany and several other countries are scrambling to find the money and political will to extend the life of ageing nuclear reactors.  This reflects a growing consensus that the global economy needs more megawatts now.  We previously discussed this issue in our blog of March 25, 2022, ”Coal Versus Climate, Now Versus … Continued

Sigma Signals

Week of September 12, 2022 Queen Elizabeth II had many of the very same characteristics that define successful investors, most notably temperance and discipline. She maintained a consistent approach throughout her tenure as Queen. No change to our signals this week. Bob Bilkie, CFA

Risk and OPM

Managing other people’s money (OPM) should reflect a level of responsibility that far exceeds the degree of risk an advisor may find acceptable for personal funds. Recent media reports suggest that some public pension funds, that manage public workers’ retirement savings, have been committing funds to cryptocurrency. Apparently this has not gone well. The management … Continued

Sigma Signals

Week of September 5, 2022 US Treasury securities – ranging from the one month T-Bill to the 30 year bond – have approached 10 year highs in yield. This is due in part to the reversal of the Feds quantitative easing as well as recognition by Treasury securities investors that interest rates need to adequately … Continued

Good Paying American Jobs

The political class, as usual, tends to frame major legislative actions in terms of job creation.  That’s probably a good thing in many situations.  However, currently the U.S. is enjoying a period of near record unemployment, exceptional high job postings and employers aggressively seeking to hire new employees and retain current staff.  In other words, … Continued

Sigma Signals

Week of August 29, 2022 Price stability is essential for a modern economy. One need only consider Germany’s Weimar Republic in 1923 and the destructive nature of that hyperinflation. Fed Chair Jay Powell was resolute in suggesting last week that the central bankers would be vigilant in taming inflation. This is a long-term strategic benefit … Continued

Sigma Signals

Week of August 22, 2022 No changes in our Signals this week. Meme stock speculators, cryptocurrency advocates, and supersonic airplane manufacturers alike are learning that it is quite costly to bet on a vessel that has no “engine”. Despite market expectations of a dovish Fed, Chairman Jerome Powell will not want to waffle and let … Continued

Sigma Signals

Week of August 15, 2022 Russia has lost. China has lost. Iran has lost. These are pre-ordained. It is impossible for planned economies and autocracies to outcompete capitalistic democracies. Threats from these regimes slow capitalism‘s progress, but does not stop it. No changes to any of our signals this week. Bob Bilkie, CFA.

Robots, Cobots and Productivity

Wikipedia defines productivity as the efficiency of production of goods and services.  Productivity is not everything, but in the long run it is almost everything.  A nation’s ability to improve its standard of living, over time, depends almost entirely on its ability to raise its output per worker.  We have previously commented on the increasing … Continued