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The “Economic Boom” Illusion

Upbeat data continues to make headlines. (The not-so-upbeat are relegated to the back pages.)  This week it was the +6.4% spurt in real GDP.  And, while the financial markets do feel a bit toppy, the S&P 500 still managed to eke out another record close on Thursday, April 29 (4211.47).  “Help Wanted” signs continue to be ubiquitous.  Companies are raising wages just to attract applicants.  The prices of lumber and …Read More

As the Economy Stagnates, Equity Markets Pivot

Market volatility has marred the last few equity sessions.  The popular indexes all peaked on September 2nd, with the most closely watched S&P 500 down nearly -7% and the tech heavy Nasdaq nearly -10%.  But, don’t be fooled by the indexes.  Anyone with a diversified portfolio has likely had a significantly different experience in 2020. No doubt Q3 GDP will show a rebound of 30% or more.  Many believe that …Read More

Are markets overvalued? Is there another bubble?

It is a mistake to think of the financial markets as a single entity. To answer the question as to whether the markets are overvalued or in a bubble, we have to examine each market separately. In the end, the only market that really appears to be in a bubble is the fixed income market. Equities There is evidence that U.S. equities are at the high end of their value …Read More