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Eric Linser, CFA | March 17, 2011
I would like to quickly share my thoughts on the events in Japan this past week.
First, let me say that my heart goes out to everyone that has been affected by the horrible disaster.
My role as an advisor is to opine on the financial aspects of the disaster, the events occurring here at home (be it the US, or California), the Mid-East, or the emerging markets. more ...
Eric Linser, CFA | Mar. 2, 2011
Answer: Political protests!
While each participant has different political agendas, the commonality I see is contagion, or the spread of unrest.
In the Mid-West, particularly Wisconsin, a battle rages over public sector finances. Elected officials are pushing to eliminate or weaken collective bargaining by government employees' unions with the more ...
Eric Linser, CFA | October 4, 2010
Wow! What a month; the 2nd best September for the S&P ever, and the best in 72 years. September brought investors a long awaited rally in the markets and bucked the trend in what is generally the weakest month of the year for stocks. The market rallied right from the start, brushing aside any poor economic readings and boosting hopes that our economy may finally be headed to stability. If there is one thing more ...
Eric Linser, CFA | Oct. 1, 2010
The market is at an inflection point; it's very close to making up its collective mind about the direction of the broader economy. It has reached this stage after a robust contest between two competing visions since spring -- one calling for continued recovery; the other seeing another downturn. Read On >> (PDF)
more ...
September ain't all that bad
Eric Linser, CFA | Sept. 17, 2010
Who would have guessed it? By mid-September, we're on a bit of a bull market rally, especially on some really mediocre economic news. Investors have looked past the bad news to keep the markets pressing higher. It's been just good enough to keep us from falling below 10,000 on the Dow, and for us to push above the 200 day moving averages (key support and resistance levels) for both the more ...
Eric Linser, CFA | September 1, 2010
September marks the beginning of fall and with it, college football and the local apple and grape harvests -- things I look forward to. And, here in the Bay Area summer is just beginning as the rest of the country transitions to fall's cooler weather.
Really the only thing I don't look forward to is that September has been a particularly difficult month, historically, for the stock market. And more ...
Eric Linser, CFA | Aug. 9, 2010
Last Friday, August 6th, we received July's jobs report from the Bureau of Labor Statistics (BLS) which solidified investor fear and drove many from the market on Friday. However, despite mixed economic reports and recovery concerns, the markets managed to build on their recent gains in July. The Dow Jones Industrial Average rose 1.8% for the week, the S&P 500 added 1.8% and the Nasdaq gained 1.5%.
more ...
Eric Linser, CFA | July 8, 2010
As we enter the 2nd half of the year, optimism that greeted the year has evaporated and investors around the world are questioning the strength of the economic recovery. European sovereign debt troubles that have surfaced have now clouded views on the sustainability of global economic growth.
So what's going on? It's not just one thing, it's an accumulation of them. Fears of a second recession (double dip) are more ...
Eric Linser, CFA | June 4, 2010
The Leak Continues, Job Numbers Disappoint
Along the California coast, Memorial Day doesn't mark the beginning of hot weather but a long bout of foggy days ahead. In my home of San Francisco, it marks the beginning of Mark Twain's winter (as in, "The coldest winter I ever spent was summer in San Francisco.") Similarly, the fog has been so dense that visibility to the market's future direction has been more ...
Phil Diamond, CFA | May 24, 2010
Forget everything you've heard or have learned in the last few weeks and just imagine that naive version of you from just the middle of last month still existed. Then, what if we told you that oil had gone from $80 to $68, interest rates had dropped by 0.60% (or 60 basis points) on 10-year Treasuries, that we had the best monthly employment report in over three years, that corporate earnings were growing like more ...
Sell in May and Go Away (until St. Leger's Day)
Eric Linser, CFA | May 10, 2010
Or as I remember it some years ago, Sell in May and Go Away; Come November, Here to Stay. No matter how it's phrased, the adage seems to be ringing true this year. Could a simple calendar event be just that easy? (FYI - St. Leger's Day is a horse race held in England in mid-September)
It's based on the notion that the more ...
Eric Linser, CFA | April 12, 2010
(an article on the US stock market and technology shares)
Will April showers bring May flowers? Or, for investors, will first quarter earnings reports be enough to justify the market's positive strides made in March, and in the first quarter? We will soon find out, beginning in earnest this week.
Spring is upon us and April is typically a month of market bloomers that lays the groundwork for the spring more ...
1 year anniversary of the market bottom, & the sustainability of the market's rally is addressed
Eric Linser, CFA | March 6, 2010
Happy Anniversary! If this is the Year of the Golden Tiger (not Woods!) then last year was the Year of the Bull. We should pop open the Champagne because we are a year past the market more ...
Eric Linser, CFA | March 3, 2010
(an article on the US stock market and technology shares)
February Marks Markets' Best Month Since November
The Dow Jones Industrial Average ended up 2.6% for February, the Nasdaq added 4.2% for the month and the S&P 500 gained 2.9%. The S&P 500 gain for February put a dent in its 3.7% January decline. Eight of the ten sectors were up for the month, with Consumer Discretionary leading the group more ...
Phil Diamond, CFA | March 1, 2010
Consumer Confidence swooned in February from January. The drop from 56.5 to 46 was far sharper than economists were expecting. The drop was largely due to changing attitudes about the jobs market and the pace of economic improvement according to the Conference Board. Not to editorialize (but we will), the people they interviewed to reach this conclusion must more ...
Eric Linser, CFA | Feb. 4, 2010
(an article on the US stock market and technology shares)
It was not the kind of start to the New Year for which investors were hoping. In January, a winter chill settled over the markets and we had our first major sell-off since the "reflective" rebound in stocks in March 2009. The major indexes and many asset classes ended the month lower.
Despite the Federal Reserve's confidence in the recovery, more ...
Eric Linser, CFA | Jan. 26, 2010
(Reprint of Jan. 26, 2010 E-Newsletter)
Dear Investor:
This past week's market action was like riding a see-saw. We go way up...then way down. However, unlike an actual see-saw, it wasn't much fun for investors. There was concern about China reigning in their bank lending so that their property markets don't overheat (and that's a bad thing?) Note: don't more ...
Thematic Investing for 2010 and Beyond
Eric Linser, CFA | Jan. 25, 2010
If the crippling financial events of 2008 and 2009 proved one thing, it's that investors need to rethink the entire philosophy of "portfolio management." Today, some of the best-performing managers around the world manage their portfolios more ...
Eric Linser, CFA | Jan. 25, 2010
It is the time of year when market pundits offer predictions for how the coming year will pan out. Such forecasts should always be taken with large grain of salt, given the dynamic nature of markets and the inherent unpredictability of the future. Moreover, successful investing requires flexibility, humility and openness to a range of possible outcomes. This mindset is particularly important in the present environment, given more ...
Eric Linser, CFA | Jan. 12, 2010
(an article on the US stock market and technology shares)
Welcome to the New Year (two thousand ten, or twenty-ten?). As we quickly look back on last month and last year and look ahead to January, we believe the main focus of the market for the month will be 4th quarter earnings reports (starting this week) and corporate guidance given for the year ahead. Quite often the market softens in the weeks preceding the more ...
Eric Linser, CFA | Dec. 22, 2009
There has been a lot of mention of the phrase "the New Normal" so I thought I'd define it, and discuss the ramifications and opportunities that such a philosophy represents.
We have just witnessed, and hopefully survived, the worst financial crisis since the Great Depression and the ensuing more ...
Eric Linser, CFA | Dec. 2, 2009
November was another good month for the markets (since the bottom in March), continuing a series of positive months, save one -- October -- which was a slightly down month. Despite the recent drop Thanksgiving week, the stock market ended the month of November with big gains. Major stock indexes were up more than 5%, the best monthly performance since July. The S&P 500 increased 5.7% and the Nasdaq more ...
Higher Asset Allocation Weighting in Portfolios
Phil Diamond, CFA | Nov. 23, 2009
In a similar vein to Silicon Valley companies outsourcing information technology (IT) operations to India, so too should investors consider making such a move by shifting their asset allocation to a higher international weighting in both stocks and bonds, a move we have continually called for in client portfolios. A reminder of why we are doing this more ...
Investors Pay the Government to Hold Their Debt?
Green Valley Wealth Advisors | Nov. 23, 2009
For the first time in seven decades,Treasury bills are paying no interest while stocks continue to appreciate -- a divergence in US financial markets that might be perilous if Fed Chairman Ben more ...
Eric Linser, CFA | Nov. 2, 2009
Overall Market Sentiment
The month of October, and in particular the last week of the month, was the pause in the seven month rally in the S&P 500 that most investors have been expecting for some time. The increased level of investor skepticism after the best run in stocks since the 1930's is understandable given that a widely-expected improvement in 3rd quarter earnings did not propel stocks forward more ...
Eric Linser, CFA | Oct. 1, 2009
The improving Street sentiment, including seven straight monthly advances in the S&P 500, is still being driven by the improving economy. The read-through from the economic data released in September and the results from some bellwether stocks that reported during the month (FedEx, Oracle) was that "the worst is behind us" and that overall demand is beginning to lift. The weight of the recovery evidence is increasingly more ...
Phil Diamond, CFA | Sept. 30, 2009
"Seize opportunity by the beard, for it is bald behind."- Bulgarian Proverb
3rd Quarter Results -- S&P 500, +15% for the quarter, +3.6% for September, +17% year-to-date; Dow Jones Industrial Average, +15% for the quarter, +2.3% for September, +11% year-to-date; Nasdaq Composite, +15.7% for the quarter, +5.6% for the month, +33% year-to-date.
What an extraordinary year it more ...
Frontier Markets
Frontier markets are the subset of emerging markets deemed to be relatively small and illiquid, even by emerging markets standards. In the past, most frontier markets were relatively inaccessible to foreign investors. However, several frontier markets have become more investable, with lower restrictions on foreign ownership and increased liquidity in local stock markets. There are economic and investment rationales for considering allocations to frontier more ...
The world is full of opportunities, yet Americans’ “home bias” in investing may limit both diversification and opportunity for their investment portfolios. While many Americans intuitively realize the advantages of international investing, even now institutional investors have limited non-US assets. Currently, the average US institution has 75% of stock portfolios in domestic equities, and 25% in international/global stocks (according to Greenwich Associates). This is quite more ...
recovery, interest rates, inflation, Muni bonds, global perspective & more
Eric Linser, CFA | Sept. 21, 2009
Here is our monthly perspective on events and trends affecting the economy, the financial markets, and investment management. First, let's take a look at an interesting chart and commentary from Morgan Stanley's chief European market strategist, Mr. Teun Draaisma, as to how much further the stock market could rally. We'll take a more ...
Eric Linser, CFA | Sept. 9, 2009
The doldrums of summertime were all but that as Wall Street extended its gains from its early March lows. Stock markets, domestically and internationally, continued their winning ways. For the month of August, the S&P 500 rallied 3.4%, Nasdaq rallied 1.5%, the MSCI World Index was up 3.9% (in US dollar terms), while the MSCI Emerging Markets Index lost 0.5% (in US dollar terms). Year to date (through the end of August), the more ...
Phil Diamond, CFA | Aug. 17, 2009
It was 27 years ago last week that the market hit its bottom in the 1981-1982 bear market. That market had seen stock prices fall to rock bottom valuations and yet, no one wanted to own stocks that summer. To think, Philip Morris at 6 times earnings and yielding 8%. The environment then was horrendous. Interest rates on long-term Treasury bonds were still at 12%, down from 15% in late 1981. The prime rate had fallen to 17% more ...
Eric Linser, CFA | Aug. 12, 2009
Here, I show you various charts of multiple asset classes. Take my thoughts to heed and actively implement broader diversification into your portfolios.
Key:
Dow Jones Ind = Dow Jones Industrial Average (US large stock index)
S&P 500 = S&P 500 (US large stock index)
NASDAQ = NASDAQ (US mid-large stock index, no financials)
Russell 2000 = Russell 2000 more ...
Did you follow Warren Buffett's advice last year to buy American stocks? In that now famous October 17, 2008 Op-Ed piece in the New York Times, Buffet shared his simple rule for buying stocks: "Be fearful when others are greedy, and be greedy when others are fearful." Certainly at that time fear had gripped the markets and investors were fleeing equities into cash.
Well if you did buy at that time, then you are one of the few, the proud, and the bold value more ...
Eric Linser, CFA | July 28, 2009
That is a good question, and in a similar vein it is like asking if Santa is for real. Well...kind of. Christmas is a time of gift giving, and the market rebound has offered us some gifts as well. It now appears that we have moved away from the Armageddon scenario of last year, and are rebuilding, be it ever so slowly. With the markets on the right trajectory as of recent, it seems safe to come out of our bunkers again. The rocky more ...
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