Mixed signals from the Fed is causing bond and stock markets to interpret our economic prospects in a wildly different way.
The Fed is responsible for setting short term interest rates. Normally, that’s the main tool the Fed uses for having the economy speed up or slow down. But what do you do if short term interest [...]

The top story this week is the July employment report from the Bureau of Labor Statistics -the BLS.  Wall St expected 100,000 new private payroll jobs created but this would be offset by losses in jobs from census workers, and from state, local, and federal workers of around 165,000. So on the whole, the market [...]

The Fed is apparently considering cranking up the printing press again.. Next week, if the Fed announces they’re planning to begin quantitative easing again via their buying Treasuries, that will demonstrate 2 things:

Thing 1:  that you can sleep better knowing the Fed will spend whatever it takes to stop deflation. (tongue firmly in cheek)
Thing 2: [...]

The US stock market hit the highest point that it is going to hit for the 2010 year – in April. A combination of federal stimulus that made for larger income tax refunds, plus cash for appliance clunkers, plus the housing tax credit —all combined to give the consumer a short term sugar rush (the April stock market peak). Those of you [...]

 
When people consider investment opportunities in Asia, China is frequently at the top of the list. Those not paying attention to Japan’s debt and demographics may additionally be attracted to Japan. But India does not usually come up until 3rd, 4th or 5th position.
 
I have written extensively about Japan over the previous few years –about [...]

No, you are not imagining it — stock and bond market volatility has steadily increased over the past 2 decades as innovative financial products have been developed and implemented. This is contrary to the objectives of many new-fangled financial products, and it is certainly contrary to what banking system regulators believed was the case (is [...]

I am quoted in the Wall St Journal today, criticizing Target Date Funds as reckless.
The Wall St Journal has 2 articles on Target Date Funds in today’s paper. One is about how regulators are going to “crack down” on target date funds. To that I say well done. The horse has long since left the [...]

The last time we had strong signals from the Chinese central government regarding a link between banking and stock markets, we sold our China ETF and then watched the Chinese stock market lose 60% of its value. That was 2007-2008. What’s got the Chinese spooked now is a warning for banks to tighten their lending [...]

This article serves to explain the following – via a real-world example:
• why we mistrust most of what we read in the financial press / on TV. Why you should as well.
• why we don’t get excited about roaring stock markets when they are not based on evidence that is rational or defensible.
• how investment policy [...]

The Japanese economy went through 15 years of stagnation and 4 years of near zero growth since its peak in 1990. Since the reasons for their economic melt-down and ours are very similar, we can learn from their efforts to right their economy.
What Happened in Japan:
• The world’s 2nd largest economy was expanding at an [...]