Sigma Signals

Week of June 26, 2023 We raised the topic last week of the false perception of Soviet Union strength in prior decades and successor Russia took the spotlight over the weekend with a mini coup attempt. This highlights the futility faced by dictators trying to inspire their citizenry to foment economic strength which begets military … Continued

Quality, Quantity, Price; Choose Two

The goal of providing high quality, together with large quantities, at low prices, has been described as the unattainable triangle.  In a free market, effective managements seek to balance these contradictory objectives at levels that meet the demands of their customer base, often by providing a choice of, good, better, or best, at appropriate price … Continued

Sigma Signals

Week of June 19, 2023 It was widely perceived in the 1940s, 50s and 60s that the Soviet Union had a vibrant economy. That was subsequently proven wrong. It is widely perceived that the current Chinese planned economic system is superior to capitalism but “green shoots” of economic recovery are fading. US economic growth of … Continued

Corporations Don’t Pay Taxes

Wikipedia defines a corporation as an organization, authorized by the state, to act as a single entity.  Corporations don’t pay taxes, we do. Corporations are, in effect conduits.  They collect taxes from others, primarily employees and customers and then remit the money to the government. Taxes collected from employees through payroll deductions include, income, social … Continued

Sigma Signals

Week of June 12, 2023 Interest rates on US Treasury securities across the maturity spectrum are within normal ranges of the last 30 years, suggesting inflationary pressures are abating. The Standard & Poor’s 500 stock index has advanced 20% over its previous low, technically marking a new bull market (and once again highlighting the futility … Continued

Hobson’s Choice and EVs

Wikipedia defines Hobson’s choice as a free choice in which only one thing is actually offered.  The term is often used to describe an illusion that multiple choices are available. The New York Times recently published an article titled “Can the World Make Batteries For Electric Cars Without China.”  The article goes on to suggest … Continued

Sigma Signals

Week of June 5, 2023 US federal debt limit negotiations encompassed a dual matrix. First, a deal had to be reached between Speaker McCarthy and President Biden, and second, Senate approval was required. Once in the bag, fuel was delivered for substantial and broad stock market gains. Favorable job growth, as reported on Friday, upped … Continued

Three Little Words

Perhaps the three most important words in an investor’s vocabulary may be “I don’t know”.  Investment decisions are typically (hopefully) based on an informed assessment of potential future financial results.  However, any estimate of future events is inherently uncertain, which no amount of research can fully mitigate.  Generally, past performance, broad industry trends and projections … Continued

Sigma Signals

Week of May 30, 2023 The debt ceiling negotiations between President Biden and House Speaker Mcarthy produced a very large slice of nothing cake. Party leaders have agreed to raise the debt limit along with modest spending reforms. Optimized fiscal policy, for maximal impact on the economy, suggests a focus on infrastructure spending, defense, and … Continued

The First Rule of Wing Walking

Wing walking is the art of moving along the wings of an airplane, most commonly a biplane, during flight.  It originated as a daredevil stunt in the aerial barnstorming shows of the 1920s. Clearly, the first rule of wing walking is, or should be, don’t let go of what you have, before you have a firm … Continued

Sigma Signals

Week of May 22, 2023 The upside to the recent spike in inflation is the renewed sensitivity between interest rates and inflation. For decades, bonds paid rates of interest that were in excess of inflation, while in recent years, this has not been the case. Fixed income investments that are safe and stable, and also … Continued

Sigma Signals

Week of May 15, 2023 A week after Fed Chair Jerome Powell announced his latest hike in interest rates, capital markets digested the news with little fanfare. Wage and price pressures, or lack thereof, as well as US debt ceiling negotiations, continue to dominate the news cycle. Our Signals remain unchanged. Bob Bilkie, CFA