The Behaviour Of The Dollar Is a Central Consideration For All Investors — I find the accompanying chart below interesting for it sheds light on several important investment themes. Firstly, it depicts the valuation differences between emerging markets, US markets, and developed markets ex-US. It is noteworthy how the valuation differences change over the years, primarily by the growing importance of technology and…

Amid All The Available Catalysts For Market Volatility, This Is the Easiest To Forecast — We live in a catalyst rich environment for volatility, with rising interest rates threatening to create inverted yield curves being but one of a host of challenges for capital markets, along with unprecedented levels of debt, a deteriorating geopolitical scene, and the malign influence of the persistent COVID pandemic.

Will We See The Greatest Decline? — We have commented repeatedly that extremes in any market should be considered by investors with the recent behaviour by the Treasury market being particularly noteworthy. Price declines of a scale that occurs only a few times a century, and the factors that produce them, certainly bear close scrutiny. The price…

What Is It Suggesting Now? — THIS INDICATOR HAS PREDICTED EVERY BEAR MARKET FOR THE LAST 200 YEARS A characteristic of bull markets for at least the past 200 years has been they have been driven by a relatively small number of issues that often reflect the development of new technologies. Major examples include, in the…

It Depends On The Season Of The Market — An ongoing debate among investors is the relative merits of the growth and value schools of investing. Broadly speaking, growth investors seek to identify rapidly growing companies that will produce substantial returns, while value investors place more emphasis on reducing risk by buying securities at a significant discount to their…

Capital Outflows From Technology Stocks Raises Risks — A key factor in our market analysis is the study of capital flows, for they exert a profound influence on almost all markets. We have found the study of capital flows often provides early clues to changes in secular trends, which makes the accompanying chart worthy of note.

The Importance Of Inflation And Interest Rates — The sharp drop in Treasury prices thus far in 2022, the greatest since the days of Paul Volcker’s historic rate increases of the early 1980s, marked the end of a four-decade bull market. The magnitude and length of this historic bull market since the peak of interest rates at circa…

What Will Follow? — The 11% drop by the S&P 500 over the first 16 trading days this year was the weakest start by stock markets in well over a century. The old market axiom that as goes January, so goes the year, suggests that 2022 will be challenging for stock market investors. Whether…