After a long period of stillness, we are finally seeing two-way markets which is a clear indication that the market is looking for direction.
Last week we saw two days with drops larger than 2%, and the so called Kudlow rally on Wednesday. More →
Today, we’ll continue on with our series on The Intelligent Investor and applying Benjamin Graham’s everlasting knowledge to the current market in order to avoid doing stupid things while taking advantage of others’ stupid actions.
Graham’s data goes up to 1971, so we’ll first look at his data and later discuss the insights that can be applied to the current market situation.
The main points Graham emphasizes that we can learn much from are:
Yesterday, we discussed what’s going on with stocks. One of the explanations is that the market is pricing in the end of the economic cycle. If that’s true, there is a lot more downside for stocks.
Let’s see what the latest economic news is, how that fits the economic cycle, what the probability for a recession is, and what we should expect from stocks.
The economic news is relatively good. Jobless claims have reached the lowest level in history. More →
I’ve been writing about the risk the stock market carries forever now. However, nothing was really happening until the last two months when volatility spiked and stocks actually went below their all-time highs. More →
If you are familiar with the Philadelphia 76ers, you know what “trust the process” means. For those of you who aren’t familiar, here is a short explanation:
What Is “Trust The Process”
The Philadelphia 76ers are an NBA team. In the NBA, you get players by drafting them from universities through an annual draft. The worse of a team you are, the more chances you have to get a higher draft pick in the draft lottery. More →
What’s Moving Gold Prices Up
When interest rates go up, gold—as a non-yielding asset—is supposed to go down, but we haven’t seen that in the last 12 months.
Gold prices are up almost 10% over the last 12 months. More →
Exxon Mobil (NYSE: XOM) is down 11% year to date and I’ve seen many headlines discussing how the stock is extremely cheap and a bargain.
I’ll first discuss why the stock is dropping, analyze the company, and then give you my view on the risk and reward of investing in XOM. More →
A yuan-denominated future oil contract could be an historical game changer.
A future oil contract is one where you buy a certain amount of oil for a future date. Since Monday, March 26, future contracts have started trading at the Shanghai International Energy Exchange. The Exchange is in a free trade zone which means that foreigners can trade on that market as well.
Some say it’s the end of the Petrodollar while others say it won’t be able to compete due to the ease with which the Chinese government interferes with free markets, especially one where there is a lot of speculation that you never lack in oil markets and because the Yuan is a government-controlled currency. More →
Pershing Square Holdings (PSH) is a closed-end investment fund run by Bill Ackman.
The fund recently released its annual report and it’s extremely interesting to dig into it to discuss whether Ackman is doing well or poorly, if it’s a good time to invest in the fund now, to look at a few of his positions, and to elaborate on the everlasting debate between active and passive investment strategies.
The Fund’s Performance
PSH’s return in 2017 was a negative 4% which is extremely bad when comparing it to the 21% the S&P 500 delivered. Since inception, the fund is up a cumulative 1.5% while the S&P 500 is up 108%. More →
We have to ask ourselves what’s going on in the world today, and the answer is pretty simple. Central banks have pushed so much liquidity into the system that everything looks great since technology plus huge investments thanks to low borrowing costs has kept prices down.