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Summary After starting at its all-time record high, the S&P 500 dropped into bear territory in 2022. On the final trading day of 2022, the CME Group's FedWatch Tool was still projecting just a quarter-point rate hike at both the Fed's upcoming 1 February and 22 March (2023-Q1) meeti...
Summary For many investors who started their investing journey following the financial crisis, forward returns will be disappointing compared to the last decade. After more than a decade, many investors have become complacent in expecting elevated rates of return from the financial mark...
Summary There seems to be a widespread view that employment is a lagging indicator of changes in the business cycle. The growth rate of payroll employment slowed sharply in the 6 months before the onset of recession. When there is no unexpected shock like Covid, it seems as though e...
Summary Lehman declared bankruptcy on September 15, 2008. Let’s compare SPY in 2022 to the experience of 2008 before the Lehman bankruptcy which then punctuated a year-long downside drift. 2022 has exhibited a downside drift much like early 2008. Now what? There will be a capitul...
Summary 2022 was a disappointing year for both stock and bond investors. The real (inflation-adjusted) 25% loss in stocks is in the bottom decile. The real 20.3 bond loss is the worst in the past 97 years, and greater losses could lie ahead. The following 2 histograms and ...
Summary With 2022's final trading day done and dusted, we move into 2023 with cautious optimism. Strategists have gotten their 2022 EPS target for the S&P 500 spot on. However, they didn't anticipate a valuation compression due to significant macro headwinds. Could 2023 be any d...
Summary The forward 4-quarter estimate fell to $222.91 this week from $223.31 last week. The P/E on the forward estimate today is 17.22x, up a little from 9/30/22’s 15.6x. There is NO reason for S&P 500 corporate guidance to be anything but subdued, and probably straight ...
Summary 2022 ends on a sour note with an across-the-board December selloff. The year is over, but the macro scene still looks challenging. If an investor has learned nothing else, it's obvious trying to fight the Fed is a losing proposition. "Anything worth doing is wo...
Summary As we near the close of 2022, we discuss what growth and tech investors need to consider after a hugely underwhelming year. FAANG/FANMAG stocks have significantly underperformed the S&P 500. Energy's resurgence against Tech could inflict more pain if the trend change is deci...
Summary The Bank of Japan shocked the market by increasing the band on their Yield Curve Control policy. The policy change was necessary because the BOJ has maintained an accommodative monetary policy despite surging inflation and a weakening yen. The policy change has not had the d...