Looking Forward, Looking Back (Part 1)

By | 2017-07-17T12:22:18+00:00 December 31st, 2015|Global Market Update|

Looking Forward, Looking Back (Part 1) Where is the market taking us? Source: Wikipedia The ancient Romans worshipped the god Janus, the god of beginnings and transitions. He had two faces, one looking forward and one looking at the past. The month of January is named for him. In order to prepare for the future, it was thought, we have to be aware of and understand the past. While we don’t invoke Janus any more when we start something new or pass through a [...]

Investment Management / Self Management

By | 2017-07-17T12:22:18+00:00 December 30th, 2015|Global Market Update|

Do our emotions work against us? Source: Wikipedia They can with investing. Our own fears or doubts or arrogance get in the way. For example, most of us are afraid of losses: the pain of losing money is a lot worse than the regret we might feel by missing out in an up market. So we leave our money in safe, low-interest bank deposits rather than risk it in a volatile market, even though we know inflation is eating it away. On the other [...]

If Only, If Only …

By | 2017-07-17T12:22:18+00:00 December 29th, 2015|Global Market Update|

Can we learn from our mistakes? Scuptor: Luigi Bartolini. Source: Art Parks International We all have regrets. Why didn’t I finish my degree? We should have gone camping last summer. Why did I send that email? “If only” thinking plays a big role in our lives. In general, our emotions send us helpful messages. Ignoring them can mean we persist in counterproductive behaviors and we miss opportunities to improve ourselves. But not always. When it comes to investing, “if only” thinking can lead you [...]

Above Average Investing

By | 2017-07-17T12:22:18+00:00 December 28th, 2015|Global Market Update|

Can we all be above average? Source: College Board, ETF Reference Of course not. That’s mathematically impossible. By definition, half the people surveyed for any characteristic will be above average, and half will be below average. But if you ask a group of people to rate themselves in many traits—driving, or generosity, or leadership skills—a vast majority will rate themselves above average. Supposedly, this overconfidence is a source of investing difficulties But that’s only true for some characteristics. If you ask people to rate [...]

Reindeer Blues?

By | 2017-07-17T12:22:18+00:00 December 22nd, 2015|Global Market Update|

Is Santa contributing to global warming? Global Warming Culprit? Source: Morguefile A team of researchers at Oregon State University has noted that with all the concern about the effect of carbon emissions on the global climate, a major greenhouse gas is being overlooked: methane. Methane is over 20-times more powerful than carbon dioxide in trapping heat. Cows, sheep, goats, and other ruminants produce tons of methane in their digestive tracts. Over the past 50 years the population of these animals has risen by 1.5 [...]

Of Silk Purses and Sow’s Ears

By | 2017-07-17T12:22:18+00:00 December 21st, 2015|Global Market Update|

Collateral dominates structure. Photo: Scott Liddell. Source: Morguefile That’s an investor’s way of saying that you can’t make a silk purse out of a sow’s ear, or that you can’t turn lead into gold. It’s been an investment theme of mine for as long as I’ve been managing money. I got my start trading bonds in the mid-‘80s. Mortgage-Backed Securities were a little less than a decade old. Investors were just beginning to learn about prepayment risk, as interest rates fell and everyone started [...]

SAT Investing

By | 2017-07-17T12:22:18+00:00 December 18th, 2015|Global Market Update|

Can investors learn something from the SATs? Source: Pixabay It may be only a few more days to Christmas, but it’s also college application season. A lot of high-school seniors are filling out the Common App, writing and re-writing essays, and anxiously awaiting their latest test scores. And there’s a test-taking technique that kids use to improve how they do on standardized tests that can help investors. It’s elimination. When they come to a question to which they don’t know the answer, they can [...]

Interest Rates, Janet Yellen, and The Bard

By | 2017-07-17T12:22:19+00:00 December 17th, 2015|Global Market Update|

What did the Fed just do? Narrowly considered, the Fed simply changed the wording in their periodic statement, announcing that the range for inter-bank interest rates—Fed Funds—would go from zero to .25% to .25% to .5%. In other words, the rate will move from “essentially zero” to “almost zero.” Practically, if a bank borrows $1mm from another bank overnight, they’ll have to pay $13.89 rather than $6.94. You could almost call this the “Macbeth” interest rate move: full of sound and fury, signifying—nothing. But [...]

Maple Bandits

By | 2017-07-17T12:22:19+00:00 December 16th, 2015|Global Market Update|

History repeats itself. Photo: Jim Mauchly. Source: Mountain Graphics That’s what I thought when I read about Quebec’s maple syrup rebels. Quebec is the Saudi Arabia of maple syrup, producing 70% of the world’s supply. And it’s no wonder: with its cold winters and long, muddy springs, the province’s climate is ideal for creating a long, active run for their millions of acres of maple trees. Source: Maple Syrup World Since the Province dominates production, they can control the market. 25 years ago, maple [...]

Rollover Ahead?

By | 2017-07-17T12:22:19+00:00 December 15th, 2015|Global Market Update|

Is the market rolling over? Source: Volvo Cars, NA “Rollover” was a B-movie from the early ‘80s starring Kris Kristofferson and Jane Fonda. It was about a financing crisis at a bank and a chemical company that spills over into a general panic. It got Kristofferson a Worst Actor award from Razzie. A market rollover is what market participants are worried about right now, with the S&P 500 at the low end of its recent trading range. The pending Fed move and seasonal funding [...]