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Tag Archives: S&P 500

Buybacks Get All The Macro Hate, But What About Dividends?

When it comes to the stock market and the corporate cash flow condition, our attention is usually drawn to stock repurchases. With good reason. These controversial uses of scarce internal funds are traditionally argued along the lines of management teams identifying and correcting undervalued shares. History shows, conclusively, that hasn’t really been true. Last year’s tax reform law was meant ideally to spur...

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US Vs China – Is It ‘Art Of The Deal’ Or Economic Warfare?

While monetary tightening remains the main risk for global stock markets, the threat of a trade war continues to dominate the headlines… THE DONALD’S DEALMAKING The question raised by Donald Trump’s trade agenda with China remains, in essence, extremely simple. It is whether The Donald is engaged in a typical ‘Art of the Deal’ negotiation, where he can suddenly turn on a dime and declare a ‘win’, or whether he is...

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Global Asset Allocation Update

The risk budget is unchanged this month. For the moderate risk investor the allocation to bonds and risk assets is evenly split. There are changes this month within the asset classes. How far are we from the end of this cycle? When will the next recession arrive and more importantly when will stocks and other markets start to anticipate a slowdown? These are critical questions for investors and ones that can’t be...

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Gold Out Performs Stocks In 2018 and This Century By Ratio Of Two To One

– Gold outperforming stocks in 2018 and this century (see chart) – Gold up close to 2% in 2018 while S&P 500 is down 2%– Trump trade wars and Kudlow as Trump chief economic advisor is gold bullish – Given gold’s performance, Kudlow’s dismissal of gold as “end of the world insurance” is “irrational”– Market volatility could drive gold to $1,500/oz in 2018 – Holmes Editor: Mark O’Byrne In a January post, I showed how...

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Never Mind Volatility: Systemic Risk Is Rising

So who’s holding the hot potato of systemic risk now? Everyone. One of the greatest con jobs of the past 9 years is the status quo’s equivalence of risk and volatility: risk = volatility: so if volatility is low, then risk is low. Wrong: volatility once reflected specific short-term aspects of risk, but measures of volatility such as the VIX have been hijacked to generate the illusion that risk is low. But even an...

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Gold Hits All-Time Highs Priced In Emerging Market Currencies

Gold Hits All-Time Highs Priced In Emerging Market Currencies – Gold at all time in eight major emerging market currencies– A stronger performance than seen when priced in USD, EUR or GBP– As world steps away from US dollar hegemony expect new gold highs in $, € and £ – Gold is a hedge against currency debasement and depreciation of fiat currencies Gold Prices in Emerging Markets Currencies, 2010 - 2018(see more posts...

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Global Asset Allocation Update

There is no change to the risk budget this month. For the moderate risk investor the allocation to bonds is 50%, risk assets 45% and cash 5%. The extreme overbought condition of the US stock market persists so I will continue to hold a modest amount of cash. There are some minor changes within the portfolios but the overall allocation is unchanged. - Click to enlarge There have been two major developments since...

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Silver’s Positive Fundamentals Due To Strong Demand In Key Growth Industries

Silver’s Positive Fundamentals Due To Strong Demand In Key Growth Industries – Increased efforts in green energy and advanced technology set to boosts silver’s demand – Four-year supply deficit set to increase due to fewer mine openings and discoveries – Bank manipulation may be why silver under performing – TD Securities and the Bank of Montreal expect silver to be best performing precious metal in 2018 – Growing...

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Global Asset Allocation Update

There is no change to the risk budget this month. For the moderate risk investor the allocation to bonds is 50%, risk assets 45% and cash 5%. The extreme overbought condition of the US stock market did not correct since the last update and so I will continue to hold a modest amount of cash. Prediction is very difficult, especially about the future… Niels Bohr Every time I see that quote I think to myself, “but that...

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The Savings Rate Conundrum

The economy is booming. Employment is at decade lows. Unemployment claims are at the lowest levels in 40-years. The stock market is at record highs and climbing. Consumers are more confident than they have been in a decade. Wages are finally showing signs of growth. What’s not to love? I just have one question. If things are so good, then why is America’s saving rate posting such a sharp decline? The answer is not...

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