Selected charts and excerpts from some of our research over the past week... Read More
For both the stock and bond markets, the first day and week of the year are often the most volatile. Even though 2018 ended with historic volatility, history suggests more to come, starting today.... Read More
Illinois and New Jersey munis have the highest yield in the country, reflecting the poor financial position of these states. But high yields have also propelled them to the top of the total return tables. This works until it doesn't.... Read More
We believe the stock market's 7% rally since Wednesday can be attributed in large part to a belief that the Fed is done hiking. If the Fed pushes back on this notion in any way, it will not sit well with the stock market.... Read More
While we like to think presidential criticism of the Fed is somehow new, it is actually rather common.... Read More
Do not fall into the trap of thinking this holiday season's market gyrations are just noise by assuming volume is low. In reality, this past week has been one of the heavier volume weeks of the year.... Read More
Jim was on CNBC yesterday talking about the Fed's use of the term automatic pilot and why the market rejected this approach.... Read More
High Yield investors continue to rely on index products like ETFs, CDX and put options to hedge positions instead of selling high yield bonds. This represents a risk as the bonds that make up these indices are too different to assume they can trade as one. When stresses rise enough, these bonds could go their separate ways, making index level strategies ineffective.... Read More
Money is leaving active managers, but not passive investments. This is hurting the stocks of asset managers.... Read More
Fed watching may have become a sport once again. If yesterday's massive rally was due to a perceived belief that the Fed has caved, the markets will be looking for affirmation from Fed officials. If traders don't hear the right words soon, we would expect the declines to continue. ... Read More
Yesterday's surge of 4.96% in the S&P 500 was one of the 20 best days in the post-World War 2 period. Unfortunately, the vast majority of these days occur in a bear market and the average loss over the ensuing year is 15%.... Read More
As the stock market's decline reaches historic proportions, The New York Times blames Trump and The Wall Street Journal blames the Fed. This decline stops when everyone stops playing the blame game and starts doing their part to stop it.... Read More
Expansion is the natural state of an economy. Recessions happen because something breaks. We examine some of the main ingredients involved in past recessions.... Read More