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Monthly Outlook: February 2024 It’s been a terrific three months in markets. And we’re talking all markets, Bonds, US Stocks, INTL Stocks – they’re all trending higher. As a result, we’re still “all in” for growth and our portfolios are up about 11% over the past several months. Investors seem optimistic about the potential of AI (artificial intelligence) and the hope for interest rate cuts. And so far, the economy remains fairly strong and corporate earnings are still growing. So up, up we go! Last year, Technology, Communications, and Consumer Cyclicals were the super-star sectors of the market. We call them “US Growth”, collectively. And just seven stocks, the “Magnificent Seven” contributed about 73% of the total S&P500 return. Already this year, we’re seeing a broadening out of returns as other sectors (Financials, Healthcare, Energy, etc.) and other markets (Bonds, US Value, and INTL) are trending higher, too. We wouldn’t [...]

Monthly Outlook: January 2024 As we embark on another year, we first must get through the countless predictions and forecasts. John Kenneth Galbraith said, “There are two kinds of forecasters: those who don’t know, and those who don’t know they don’t know.” Similarly, Yogi Berra said, “It’s tough to make predictions, especially about the future.” All kidding aside, everyone knows that most forecasts are wrong, and sometimes very wrong. But it’s just too irresistible to try, and we seem to be hopelessly addicted to people who claim they can see the future. Take, for example, the Barron’s Roundtable “Year Ahead Outlook.” Twelve leading strategists from major Wall Street firms are interviewed, and their year-ahead stock market and interest rate forecasts are recorded. It’s laughable how wrong they are, year after year, but the survey sure sells newspapers! Not to be outdone, we offer our own 2024 Outlook, below. Unlike most, [...]

Monthly Outlook: December 2023 The Santa Claus Rally came early this year with nearly every market surging higher in November. Just last month, our Outlook title was “What’s Up? Not Much.” One month later, we’d have to answer, “Everything!” US Growth & Value, INTL, Emerging (except China), Bonds – they’re all trending higher again. Even the Israeli stock market turned back up, despite the on-going conflict, and is higher than it was pre-war. So, why the surge? It seems investors are increasingly confident that the Fed and other central bankers have completed their interest rate hikes and monetary tightening. The idea is that lower interest rates in 2024 will support higher financial asset prices. And that’s true, mathematically. After the COVID pandemic smashed the global economy in early 2020, global central bankers unleashed massive stimulus in late 2020 and all of 2021. That (and vaccines) stabilized the economy and markets. [...]

Monthly Outlook: November 2023 Global stock markets had a decent run from March to July. But they’ve been zigzagging lower over the past three months. We know many of you have noticed because you’ve been calling in for reassurance. We all know that markets bounce around daily, but we focus on medium- to long-term trend changes. That is, we’re looking for the day when any of our market ETFs cross over their price trendline. And we can report, we are seeing crossovers happening right now. As a reminder, price trendlines are a simple calculation, based on moving average prices. They’re numerical like a thermometer reading. On our charts, we can see when any of our market index ETFs cross above or below their price trendline. That’s our trigger to either buy or sell, and we’ve been selling. So, what’s up? US Growth Stocks, Commodities, and Short-Term Bonds. That’s about it. [...]

Monthly Outlook: October 2023 We know that stocks have been in a correction the past two months, and it feels a little painful. The S&P500 is down 6.3%, and the NASDAQ is down 6.6%. International stocks are down 7.5%. Bonds have lost 3.1%, too, so they aren’t helping, either. The question being asked is whether this is a normal 5%-10% correction or the beginning of something worrisome? There is a lot of handwringing about inflation and interest rates, recession or no recession, rising unemployment, stalling corporate earnings, dysfunctional government and shutdowns, upcoming elections, and so on. If we could just know all the answers today! Of course, no one can but there may be something better that we do know. At least when it comes to investing, we can measure with 100% certainty the price trendline for every market. We can observe, on a daily basis, whether a market is [...]