In times of unparalleled uncertainty it is helpful to seek perspective. Reflecting on the COVID-19 induced shut down, I think of it as a storm with wind and rain blowing across a forest. The weak trees fall first. Then, as the wind and rain continues, other trees begin to come down. The longer the storm [...]
Interest rates around the world have declined to some of the lowest levels in my lifetime of 70 plus years. The 30-year U.S. Treasury was at its lowest yield ever in August1 since being first issued in the mid 1980’s. The long-term (30-year) U.S. Treasury is selling at a yield that is about ¼ of [...]
In the last 35 plus years we have experienced a great “bull” market in both stocks and bonds. The stock market as measured by The Dow Jones Industrial Average has gone from 1000 in 1982 to over 25,000 today. Interest rates as measured by the 30 year U.S. Treasury have declined from over 12% in [...]
The huge decline in interest rates and the drop in stock prices leads me to the following forecasts. One of the first things that I think needs to be noted is that the peak in free market interest rates for this cycle occurred in late September. Interest rates around the world have dropped significantly since [...]
The Federal Reserve has been increasing short-term interest rates (i.e., the Fed Funds Rate) for about two years, raising the target rate from 0.25% to 2.00% today. In comparison, longer-term interest rates are controlled by supply and demand in the marketplace. Looking at two commonly used bonds, the 10-year U.S. Treasury and 30-year U.S. Treasury, [...]
Over the last 49 years, I have met with thousands of individual investors, and have been a student of the markets and investor behavior. Why are some investors successful and why do others fail? Dalbar (an independent research firm) studied investor results in equity mutual funds over a 30 year period and found that the [...]
Over 80% of forecasts for 2017 were for interest rates to rise. Most were recommending shorter maturities. Our work, based on historical data, suggested that 2017 would be a good year for bonds (and perhaps a great year). Our analysis concluded that when you have carnage in the bond market caused by a rapid rise [...]
The 2016 election of Donald Trump awakened capitalism in the United States with hopes of less regulation and lower taxes for corporations. President Trump’s mandate that every new regulation must eliminate two regulations is a simple yet effective way to maintain regulatory control while reducing some of the burdens of onerous regulations. The biggest beneficiary [...]
Boiled down to the simplest level, the tax debate is really a battle about the distribution of dollars.
In the midst of the debate on tax reform, it’s important to first understand who pays taxes and how much they pay. The data for this article was utilized from the White House’s Office of Management and Budget. First, the largest source, or 47.3% is paid to the government through personal taxes. Payment by various [...]
