August 2019 Newsletter

Back to the basics. Ok. It’s time to discuss the value of using the John Wooden basics of basketball as an investment strategy. As you may know, John Wooden was the greatest head coach of men’s college basketball of all time. His coaching acumen started as a player. At just 5’ 10” tall, he was the first player to be … Read More

May Newsletter

Chaos is currency. Tariffs are just one strategy. Think tanks oppose think tanks in a fight for dominant world hegemony. The democratic industrial nations are experiencing a growing existential threat from Chinese mercantilism.  A trade deal with China was never meant to be anything other than an armistice between two very different economic business models- now butting heads. The Thucydides … Read More

March 2019 Economics and Strategy Update

Economics and Strategy Update The latest U.S. Equity Strategy from Credit Suisse put the year-end price target of the S&P 500 at approximately 3,022 or roughly 7.2% higher than the current 2,819 price on the SPY (SPDR S&P 500 ETF).  The last time I introduced 2019 year-end values for the S&P 500 was October of 2018.  At the time Credit … Read More

March 2019 Newsletter

Overbought to Oversold By Vaughn Woods   After more than two months of an overbought setting the overbought/oversold oscillator is back to oversold territory by a pinch. This scenario may become more pronounced though at this time volatility measures are very tame. With the markets somewhat exhausted on the buy side it is easy to predict a short-term correction of … Read More

December 2018 Newsletter

Market Correction and Posture Leading into 2019 As of Monday, December 17, 2018 the major market indexes, including the S&P 500 index are testing their previous 12-month lows. Fundamentally the economy appears strong enough to engage in correction tests of 10-15% without flashing signs of a recession. However, from a technically standpoint, it’s important that the S&P 500 remains above … Read More

October 2018 Newsletter

Drama Meets Composure October 10, 2018 The national drama playing out before the midterm elections contrasts sharply with a stock market that has every reason to fade but remains stuck in a pattern of composure, otherwise described as slower growth for longer.  This may be due to the construct that equity valuations remain near their historic averages.  To illustrate, on … Read More

July 2018 Newsletter

It’s time to talk about the yield curve.  As you may know, I have had a note taped to my computer for eight years now.  The note reads: Relative valuations (stocks) remain favorable (to bonds) until 10-year bond yields rise to 3.5%.           Since the 10-year U.S. Treasury bond now sports a yield of just 2.88%, as of this writing, we … Read More

June 2018 Newsletter

The United States is now in the second longest economic recovery on record.  This recovery is currently six percentage points less than the average historic magnitude of recoveries.  Based upon factors reviewed below, one could conclude a recession is unlikely until the third quarter of 2020. Typically, recessions are preceded by: Yield curve inversions: Normally precede a recession by an … Read More

April 2018 Newsletter

More Market Volatility April 6, 2018 Regarding the stock market; the market correction we are now experiencing is pressuring investor confidence.  Given the observation that the current correction has been in place for some nine weeks now and given that the average correction lasts approximately 18 weeks, we should remain in a corrective phase for another nine to eleven (the … Read More

February 2018 Newsletter

A Long-Awaited Correction February 13, 2018   Well, we waited 18 months for a correction in the S&P 500 and finally got one.  Fortunately, we generally raised our cash position in portfolios to roughly 30% prior to the larger spike down, which mitigated downside risk and gave us capital to employ at lower valuations.  Now however, the challenge is to … Read More