Lance on Nov 18 2008 | Filed under: Asset Allocation, Domestic Equities, Valuation, indexes
Yes, but they are supposed to be if you want reasonable returns for the risk, which is one more reason the Fed Model is wrong. Compared to the past however not that cheap. Jim Hamilton takes a look:
We’re currently at a P/E around 14, a bit below the historical long-run average P/E of 16.3, meaning [...]
Lance on Nov 17 2008 | Filed under: Asset Allocation, Risk, economy
The insufferable Peter Schiff has a video going around, which frankly, is just brilliant. He may be unpleasant at times, but he nailed this thing, and took mounds of abuse while doing so. More importantly, I KNOW HOW HE FEELS!
The resentment, irritation, condescension and, at times, outright hostility to my Cassandra act makes me wish [...]
Lance on May 05 2008 | Filed under: Alternative strategies, benchmarks
That is All About Alpha’s assessment of 130/30 funds (definition here.) Which seems about right to us.
Few active managers, even if they actually outperform their benchmarks, can overcome the expenses associated with doing so. The reason is not necessarily that they cannot do a good enough job of picking investments that can outperform, but that [...]
Lance on Apr 30 2008 | Filed under: Around the Web
The Oracle of Omaha is human, we can all take some comfort in that. More here and here.
Lance on Apr 07 2008 | Filed under: Domestic Equities, Economic Indicators, Economics, Housing Market, Latest data, economy
Personally I think we have been negative since November. Given the large positive number in the third quarter, the barely above break even number in the fourth quarter virtually guarantees that the economy went negative sometime in November and December. However, if we are not, it is highly likely coming. Here is a graphic which [...]
Lance on Feb 06 2008 | Filed under: Asset Allocation, Great Investors, indexes
One of my favorite people to read is Rob Arnott, who never ceases to examine every truism, shibboleth and academic orthodoxy in the field of finance. What are alpha and beta? Why and when is it important to distinguish between them.
All About Alpha reviewed some of his points a little over a year ago, and [...]
Lance on Feb 04 2008 | Filed under: Domestic Fixed Income, Federal Reserve, Risk, economy
Much of what has been happening over the last year in the credit markets was foreseeable, if not assured. I will admit though, I hadn’t really considered this aspect.
A while back MBIA, AMBAC and other monoline insurers backed sleepy municipal bond portfolio’s. Having entered, and then become ensnared, in the broader credit markets, they face [...]
Lance on Jan 29 2008 | Filed under: Great Investors
In line with the comments in the previous post about the reasons people invest the way they do, and repeatedly fall for the excesses of short term speculation, Jeremy Grantham has long spoken of the career risk of unconventional success and failure.
The great paradox of our business is that reducing or avoiding real risk [...]
Lance on Jan 25 2008 | Filed under: Domestic Equities, Economic Indicators, Economics, Market Data
As I noted earlier, Dale Franks was curious about how Harley Davidson (HOG) would do on its latest earnings release:
One earnings report to watch this week, though, is Harley-Davidson (HOG). It’s a solid company with a loyal customer base—I’m one of them actually—but, motorcycles are a luxury item. For every guy [...]
Lance on Jan 25 2008 | Filed under: Asset Allocation, Domestic Equities, Risk, Taxes
Where Have Buybacks Gone, asks the Wall Street Journal? I cannot tell you how often I heard that buybacks were going to keep earnings strong (Ken Fisher in particular comes to mind.) As the Journal points out, that can dry up if people need the capital, or in a related issue, have loaded themselves up [...]
Lance on Jan 15 2008 | Filed under: Economics, Politics
Alea notices that a widely cited paper claiming that Democratic Presidents are better than Republican presidents for the stock market doesn’t hold water:
This paper shows that the statistical tests applied by the authors of the study were wrong, and that, once corrected, the difference in stock market returns under different presidential regimes is not meaningful.
The [...]
Lance on Jan 10 2008 | Filed under: Around the Web
Bloomberg had a headline a while back which screamed Cheapest Stocks in Two Decades Signal Bull Market. This is based on the so-called Fed Model.
I think this is a really flawed model.
The Big Picture explained why he agrees with me.
Lance on Jan 07 2008 | Filed under: Domestic Equities, Economic Indicators, Economics, Employment, Inflation, Latest data, Risk, today's links
To start off James Hamilton reviews last weeks depressing economic data, and its effect on the stock market. Which leads to the next question.
Trying to get defensive? The Wall Street Journal notices some of the same things we have been talking about that make it difficult, while the New York Times picks up on another [...]
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