2016 Opens With A Kick To The Throat

The weekly Market Update is posted at Alpha Baskets and includes the following; The declines in the US markets were shocking after a positive mood (sort of) created in December by the FOMC hiking rates with the idea being that the economy must be healthy enough to tolerate a rate increase which may have been true for about ten minutes. The Dow Jones Industrial Average dropped 6.20%, S&P 500 fell 5.98%, the NASDAQ was down 7.26% and the Russell 2000 gave up 7.67%. The most disappointing day from the rough week may have been Friday when indications were for a positive day after the jobs data and after opening in the green, the markets worked lower all day closing at session lows. Please click through to read the entire update. We had about two feet of snow here last week. The first picture is snow slowly sliding off the metal roof of my office heavily filtered on Instagram.   We have a 1940’s era Dodge Power Wagon that was left on the property when we bought the house. Also heavily filtered on...

Did Anyone Get The License Plate Of That Market?

My latest post at Alpha Baskets looks at the huge error in putting the short term over the long term in building and then maintaining a portfolio and investment plan. As I mentioned a few posts ago the week the Fed finally hiked rates the S&P 500 had a 27 basis point move but how many people were motivated by something they saw on TV or read on the web to try to trade that news. From the post; To which I would add except for the times it doesn’t, which is to say that predictions are really guesses and like anything else, simply extrapolating the past cannot be correct 100% of the time. So if past is prologue works, except when it doesn’t, then the focus needs to be more about the process and the person overseeing that process and this applies to individual investors managing their own portfolios. Please click through to read the entire post. The picture is from the Rock & Roll Hall of Fame from 2014, heavily filtered on Instagram. If you think my pictures are interesting you can find me on Instagram...

A Wild Ride To Nowhere

Phrases like bumpy ride to nowhere, volatile round trip to nowhere and others are ones I’ve used many times before and that idea captures the equity market in 2015. This week’s Market Update reviews 2015 and includes the following; Markets endured a good old fashioned correction in the third quarter with the benchmarks declining roughly 7% by quarter’s end but at their worst were down 11-12% from highs earlier in the summer. The FOMC waited until the middle of December before finally raising rates. Many feel that the best opportunity to raise rates may have been earlier in the year when GDP and employment were a little bit stronger. While anyone can armchair quarterback the bigger dilemma was that the Fed painted itself into a corner by setting targets for inflation and the headline unemployment rate many years ago in the expectation that stimulative interest rate policy would actually be stimulative. The economy reached 6% unemployment long ago without getting to 2% inflation and all the while GDP growth has muddled relative to past recoveries/expansions. Please click through to read the entire update. Early Saturday morning I checked to see what bowl games were happening that day and saw that the late game was the Cactus Bowl and was being played at Chase Field down in Phoenix. I have a thing for sporting events in alternative venues like hockey in a football stadium so a colleague from the fire department and I were able to get great seats from Stubhub and go to the game. It turned out to be one of the few close...