Thoughts on the Election

Like a large number of their fellow Americans, the Democrats lost their house on Tuesday. The power has shifted in Washington with the Republican controlled house serving as a counterbalance to President Obama and the Democratic majority in the Senate. A major concern is gridlock in this weak economy. Gridlock would be a result of … Continued

November Surprise

Given expectations of material changes in the contours of Congress after next week’s elections, it is not inconceivable that the leader of the Democratic Party, President Obama, could launch a “November Surprise.” While this is pure speculation, our hunch is that it could be related to the Afghan war which is very unpopular with the … Continued

Michigan’s Number One Export

There has been much discussion regarding the outflow of college graduates from Michigan. By some accounts more than half of all recent college graduates have left the state for a job. We’ve experienced it with our own family members, and have heard plenty of similar stories of our clients’ children heading to Chicago, New York, … Continued

Timeless Advice

Washington DC policymakers continue to grapple with measures to spur job growth. The October 12, 2010 issue of the Wall Street Journal does a service to its readers with the inclusion of one of James Madison’s 222 year old submissions to the Federalist Papers (Number 62). His observations are every bit as insightful now as … Continued

Just Another Number

The Dow Jones Industrial Average has been bumping up against the “11,000” level. While for those who are “long” stocks, the increase means their net worth has been enhanced, but there is still nothing particularly noteworthy about this level. However, investors and observers are riveted on these milestones and accept each as a barometer with … Continued

Don’t Let Your Guard Down

We haven’t talked too much about inflation here and have recently noticed concerns about inflation have been somewhat mitigated in the press and blogosphere. We get especially nervous about something when everyone else thinks it’s not worth worrying about. Inflation is a measure of a general rise in prices of goods and services over time. … Continued

What is the price of gold telling us? Your thoughts?

Gold prices spiked this week, gaining over $50 per ounce in one trading day. In the absence of evidence of widespread, surging consumer prices, and with relative calm on the geo-political stage, the natural question to ask is, “What does this signal?”. Japan and China have intervened in currency markets this week with Japan trying … Continued

Make Up Your Mind

The equity markets were quite weak in August, but the first week of September has brought strength. Investors are looking for clues, trying to assemble a series of statistics that might indicate the course of economic growth, and hence corporate profits which, over the long term, drive equity prices. Election season rhetoric will begin to … Continued

Drain the Swamp

Read the article from this week’s Barron’s Magazine – “Was The Flash Crash Rigged?” The expert cited in the article implies market manipulation by high frequency trading (hft) firms. If they have not done so already, the SEC needs to immediately launch an investigation (and be more rigorous than when investigating Madoff). Capitalism thrives because … Continued

I’m Getting Tired, Pick up the Pace

The August 22, 2010 New York Times carried an article (In Striking Shift, Small Investors Flee Stock Market) noting that investors resumed their net liquidation of common stock holdings in a material fashion (over $33 billion) during the first seven months of 2010.  As we interpret price charts, the last secular bear market in common … Continued

Markets in Transition

Jeremy Siegel and Jeremy Schwartz write in the Wall Street Journal today that common stocks are attractive and bonds are not. With regard to bonds, this appears to be a blinding glimpse of the obvious, with interest rates at generational lows. But, we tend to use bonds for their capital preservation characteristics as opposed to … Continued

The Public Pension Reform Dividend

The burgeoning growth worldwide of unfunded liabilities has received a lot of press lately. Defense spending (future blog), pension liabilities and public sector salaries have been drawing the most ire from both sides of the aisle. Public debt concerns across the world have been much in focus, with the Greek debt crisis and public spending … Continued