Category: market commentary

Today’s Yield Curve Steepening Is Not Different This Time, It’s Not The Same

Image by Thomas Malyska from Pixabay Investment volatility remained elevated this year. One can point to any number of culprits. My preferred cause has been interest rate volatility. I’ve been cautious as the Federal Reserve (Fed) raised its benchmark rate. However, a popular risk indicator has recently been sending a mixed message. The yield curve..

Read more

The Similarities & Differences Between Today & The GFC

Image by Andrew Martin from Pixabay I’ve said it before, 2023 has been a heck of a year. In just five months, four large regional banks and one major global financial institution shuttered, marking the second-worst year for bank failures. Only the Great Financial Crisis of 2007 to 2009 (GFC) was worse. Understandably, many have..

Read more

Hunting For Unknown Liabilities, Not Asset Risks

Image by Vitor Dutra Kaosnoff from Pixabay The recent wave of bank failures returned asset liability management (ALM) to the spotlight. Many correctly identified ALM breakdowns as causing their ultimate demises. Yet, ALM remains an underappreciated investment topic. It determines the fate of every company, not just the financially-oriented. Yet, few seem to fully appreciate..

Read more

Silicon Valley Bank’s Failure Highlights Systemically Combustible Conditions

Image by Berenice Calderón from Pixabay The failure of Silicon Valley Bank (SVB) has brought questions of systemic risk to the forefront. SVB was the third regional bank to fail this month (along with Signature Bank and Silvergate Bank, collectively referred to as the “S Banks”). These coincided with the Swiss government-brokered acquisition of Credit..

Read more

Why I’m Waiting For The Fed To Pivot

Image by Jose Antonio Alba from Pixabay So far, my 2023 investing looks just like 2022: lots of waiting. I’m not waiting for a recession to pass or for GDP to improve. I’m not waiting for a certain employment report or for corporate earnings to change. I’m not waiting for the Consumer Price Index (CPI)..

Read more

Markets Are Reteaching Centralization’s Dangers

Image by 14995841 from Pixabay Note from the author: I use the terms stability and instability throughout this article. However, resiliency and fragility, respectively, more accurately describe the phenomena that I’m describing. Centralization creates fragility and decentralization creates resiliency. Please note this as you read the article below which I left in its original form…

Read more

No, Fed: Supply Construction, Not Demand Destruction

Image by bridgesward from Pixabay Everyone loves to dunk on the Federal Reserve (Fed). To many, the setters of U.S. monetary policy never get it right. Its stable of Ph.D. economists are always too late, or too slow, or too early, or too fast. Shockingly, many have built prominent careers in peddling this viewpoint. Yet,..

Read more

Pondering Investment Themes After The Russian Invasion

Image by linsenfutter2016 from Pixabay So much for returning to normal. I had hoped that easing COVID restrictions would supercharge economic growth this year. Many affected industries and markets were rebuilding and reopening to a backlog of robust demand. Sure, markets had issues to grapple with: inflation, changing central bank policies, and the return of..

Read more

Rising Rates And Volatility Might Create Future Opportunities

Image by QuakerGirl22 from Pixabay Catching inflection points is the holy grail of trading. It’s what makes investing lore. From shorting the 2005 housing boom or skyrocketing technology stocks in 2000, to classic value investing, taking contrarian positions can create large profits and legendary reputations. While seductive, it’s a difficult way to trade over the..

Read more

How Gold Lost Its Inflation Luster

Image from Pixabay. Gold is lots of things to lots of people. To some, it’s the ultimate store of value and a source of financial freedom. To others, it’s just a shiny rock with an inflated, emotionally-driven price. Gold’s most popularly used to hedge inflation risk; to preserve purchasing power from thieving bureaucrats and central..

Read more

Social media & sharing icons powered by UltimatelySocial