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Investment Advisor

The Fed’s Ill-Designed Inflation Policies

On Thursday, August 27, Fed Chair Jay Powell spoke at the Fed’s annual Jackson Hole symposium. His talk was much anticipated, as it was expected that the old 2% inflation objective would be updated. In fact, the Fed had telegraphed the change; and the Fed has been following the newly announced policy for several months. The policy change allows the Fed to permit inflation to exceed the Fed’s announced 2% target without …Read More

The Economy: Navigating Scylla & Charybdis

  In Greek mythology, Scylla and Charybdis were mythical sea monsters existing on the opposite sides of the Strait of Messina, between Sicily and the Italian mainland.  Scylla was a six headed sea monster; Charybdis a huge whirlpool.  Because they were so close together, any passing ship was threatened.  In Homer’s Odyssey, Odysseus passed close to Scylla, losing only a few sailors rather than risking losing his whole ship in …Read More

Coronavirus: The Black Swan

  Black Swan taking off (Cygnus atratus) South Island, New Zealand (Photo by: VWPics/Universal Images … [+]VWPICS/UNIVERSAL IMAGES GROUP VIA GETTY IMAGES   The equity market finally had a reaction to the effects of the coronavirus (Covid-19) last week, and it was significant with the S&P 500 falling 252 points (7.4%) from its record high close on Valentine’s Day. As of this writing, most of the fall (209 points) came on Monday …Read More

Reconciling Contradictory Data

Originally published in RGJ’s Business Section, Sunday, 4/5/15 The markets are still concerned about a weakening U.S. economy, as data from the industrial portion of the economy continues to show weakness, even in March. The ISM Manufacturing Index fell to 51.5 in March, its lowest level in more than 2 years; ADP indicated that private sector job creation fell to 189,000 in March from 214,000 in February with most of the …Read More

Three Uncertainties Are Driving the Markets

The financial markets have been focused on three uncertainties: the strong and rising value of the dollar vis a vis other currencies, weakening U.S. economic indicators, and the timing and magnitude of Fed policy actions.  All this with a background of the ongoing Greek tragedy and continued political strife and terrorism worries. Volatility has resulted.  To show the market’s uncertainty, in the month of March, of the 19 trading days …Read More