![]() | |
![]() | |
![]() |
Investing Information |
|
![]() |
Keeping It Interesting
Some lines from a movie never leave your mind; I don't remember the context always, but I do recall the dialog. "The Big Chill" is one of the few movies I own (VHS). At dinner, William Hurt, Jeff Goldbloom, and Tom Berenger argue about their past like dogs growling for a turkey leg at Thanksgiving. JoBeth Williams brings calm by chastising the men, and to that Hurt replies with a smirk, "Just trying to keep the conversation lively." It's one of those "had to be there" moments. Bond traders "keep the conversation lively" . Have you noticed that long-term rates have fallen while short-term rates have risen? Low long-term rates keep the housing market active (a positive, maybe), with the implicit suggestion of a slowing economy (a drop in long-term borrowing by corporations suggests a slow down in the economy). All of this is happening as the Federal Reserve torques rates higher! An interest rate anomaly occurs when short-term rates get close to exceeding long-term rates. This is known as an "inverted yield curve". Inverted yield curves preceded the past five recessions. "Something strange has been going on in the bond market", writes E.S. Browning (Wall Street Journal, May 31, 2005). Markets get long-term trends right, usually. Low interest rates recommend positive stock returns; however, market volatility seems to defy such optimism. One day stocks are up, and the next down. Someone said, "When interest rates are low equities grow." Many stock analysts get slap-happy moments with low interest rates. Optimism does not move markets; pessimism does. Browning wisely observes "...the prevailing view in the stock market is one of celebration..." when it ought to be fear. (WSJ, May 31, 2005) Some economists do expect worsening economic conditions. "Over the past 35 years, the skeptics say, Fed rate increases have tended to end with trouble." (WSJ, May 31, 2005) Most recently, the bubble gum stock market popped during 2000 left stocks looking like pink bubble gum on a child's cheeks. No simple resolution keeps investors from the dangers of an inverted yield curve. Every analyst, economist, and pundit has an opinion. What matters is the reaction of the bond market, and the current short and long-term yields are "keeping it interesting". My point? There is no way to predict every asset class move (up or down). Broad diversification within the bond universe provides aggregate benefit to your portfolio. This does not mean owning every conceivable bond; it does mean integrating bond management consistent to reach your goals within the context of your risk tolerance. * These are the major bond (fixed income)asset classes U.S. Government * International Fixed Income * Municipals (tax efficient accounts) * High Yield * Emerging Market Debt "When a thing ceases to be a subject of controversy, it ceases to be a subject of interest." - William Hazlitt, English essayist (1778 - 1830) Ray Randall serves clients as a registered investment advisor with his firm, Ethos Advisory Services, Essex, Massachusetts http://www.ethosadvisory.com. He has wide experience within the financial services industry, writes a weekly newsletter for Ethos Advisory Services, and coordinates the developments at Echievements http://www.echievements.com. Ray holds a Masters Degree from Gordon-Conwell Theological Seminary, Hamilton, MA. You may email him or call (877-895-3756).
MORE RESOURCES: Investing Action Plan — January Wrap: Apple, OPEC, Exxon And The Fed Investor's Business Daily Where Are Stocks, Bonds and Crypto Headed Next? Five Investors Look Into Crystal Ball The Wall Street Journal Nasdaq Bear Market: Cathie Wood Is Still Bullish on These 3 Beaten-Down Growth Stocks The Motley Fool Tax-Aware Investing: What Is It and How Do I Do It? | Chase Chase News & Stories Investing in Method Andreessen Horowitz Committee affirms anti-ESG, anti-China pension investing bills Indiana Capital Chronicle Investing When Your Time Horizon Is Short The New York Times 5 of the Best Paper Trading Sites | Investing | U.S. News U.S News & World Report Money The Best Stocks to Invest $20,000 in Right Now The Motley Fool Investing in Voldex Andreessen Horowitz What's Going on With REITs? An Investors Guide The Motley Fool Impact Investing for Employees Morgan Stanley How ‘Permabears’ Make Money by Selling Fear Investing.com Democratic lawmakers create sustainable investment caucus to ... Pensions & Investments Investing Opportunities Emerge in Latin America Morgan Stanley 2 Dividend Stocks to Help You Beat the Market in 2023 Investing.com How to Invest in Stocks - Buy Side from WSJ The Wall Street Journal Why You Should Invest: Top 10 Reasons AllBusiness.com Soft Landing Scenario: Possibility or Fed Myth? Investing.com The 10 golden rules of investing Yahoo Finance Investing in Cygnvs Andreessen Horowitz Ultimate Guide on Investing for Beginners Entrepreneur Your Investment Lost Money Last Year. So Why the Big Tax Bill? The New York Times Investing $100,000 in These Stocks in 2023 Could Get You $1 ... The Motley Fool 80% of Warren Buffett's Portfolio Is Invested in These 7 Stocks The Motley Fool The Art of Contrarian Investing Investing.com 5 companies UPMC is investing in Becker's Hospital Review Investing in Deflation, Inflation and Stagflation Regimes Wealth Management Investing in REITs vs. Direct Real Estate Morningstar Investing in PLAI Labs Andreessen Horowitz 8 Best Small-Cap Value Stocks to Buy | Investing | U.S. News U.S News & World Report Money Spend Your Time Working or Investing? » The Stacking Benjamins ... - The Stacking Benjamins Podcast Spend Your Time Working or Investing? » The Stacking Benjamins ... The Stacking Benjamins Podcast Investing in 2023: A Year to Be Patient and Selective Morgan Stanley 5 Investing Alternatives for Conservative Investors Kiplinger's Personal Finance U.S. Warns Banks to Watch for Russian Oligarchs Investing in ... The Wall Street Journal Rosie on the House: Investing in a whole home energy audit Arizona Daily Star 1 Smart Way to Invest Your Tax Refund You Haven't Thought Of The Motley Fool 3 Reasons Investors Should Zoom In on GoPro Stock The Motley Fool Rewind 2022: My Investing Journey Seeking Alpha 1 Undervalued Stock That Smart Investors Are Buying In 2023 The Motley Fool Coffee Steaming Again After 4 Months in the Cold Investing.com Is Intel's Downfall Good News for AMD and Nvidia Investors? The Motley Fool The Week in Impact Investing: Integrity ImpactAlpha Personalized Investing Portfolios: Unlock the Greatest Potential Kiplinger's Personal Finance Calm Before the Rally? Investing.com Bohanon and Horowitz: When investing, balance opinions of ... Indianapolis Business Journal Long-Term Investments Require a New Approach Kiplinger's Personal Finance Lucid Group doubles on Saudi rumors By Investing.com Investing.com Would You Still Consider Investing in Amazon (AMZN)? Yahoo Finance International Day of Education: Investing in the Future of Students ... Leader Publications |
![]() |
![]() |
![]() |
RELATED ARTICLES
Beginning Investor - Investment Terms Over the course of the past two months, readers have brought to my attention that there is a steep learning curve for investment terminology. That's why the focus of this month's Beginning Investor column will be investment terminology. Why Should I Use Penny Shares to Build Wealth? A strategic question. Why indeed?1. An Old Dividend Stock Investment Idea, for a New Generation Death and taxes! The certainties of life! And then, of course, there are the mortgage payments, the utility bills, phone bills, the car payments and thirsty automobiles. Add that to the grocery and clothing bills, and there appears to be more then just death and taxes as certainties of life. Why have Investment Plans for the Stock Market If you do not have an investment plan in the stock market you are subject to impulses, urges, hunches, premonitions, strong feelings, greed, panic, fear, indecision, and just plain foolishness. In my opinion, without a plan, without that clear conception of a total stock market investment strategy, the chances of successful investing in the stock market are pretty slim. Margin Benefits are Marginal at Best Margin is one of those things that novices find puzzling about the stock market, but the concept is really quite simple. Still, with understanding the basics of using margin accounts, determining the wisdom of using margin can be quite a conundrum. Success Trading: Some Basic Terminology for New Traders The world of trading can get very complex because the financial markets are complex. There thousands and thousands of successful traders out there today. Your Worst Enemy To Successful Investing - The Media How do you make your investment decisions and where do you get your information? If you're like most of the people I know, you look to the experts.That's fine, however it's important to be aware that for every expert, there's an opinion and for every opinion there's an expert. Investing and Understanding What You Buy "There is nothing more frightful than ignorance in action!"Johann Wolfgang von Goethe (1749 - 1832)I don't really know how cars actually work. Not really! I know how to drive them, but if you asked me how they work, I would not really know how to definitely explain it. Dumb Money Many people have, at one time or another, taken some of their hard-earned funds, and decided to put them in the stock market. These well-meaning individuals either acted on a tip they saw on CNBC, or actually believed one of those crazy faxes/emails that said XBXB @ $0. How Eating Bitumen Made Me a Better Stock Trader Stock market trading is a fascinating activity.There are so many layers to it. Buying a Home - Your BIGGEST Investment This column has often focused on intangible investments like stocks that a young investor might hold in their portfolio. While these are one of the most important components of an investment plan, it is not the dominant one for most young people. Economic Survival in the 21st Century - the Three Key Questions to Ask In this "special report", I want to pose a few important "philosophical questions" to my readers. Firstly -- our Federal Reserve Chairman, Alan Greenspan, addressed the effects and implications of our aging population on things such as Social Security again in a speech that he made last Friday. How to Invest Your Money Think carefully on how to invest your money because if you make wrong decisions it could cost you dearly. There are many ways in which to invest your money and as such seeking the advice of a professional would be a very wise move. Find a Methodology and Minimize Investment Madness There are many reasons to be investing these days, and too much opportunity to not have your money working for you.However, I believe the majority of people dread having to deal with investment matters, and tend to jump into purchases and then hold their breath hoping for the best. Gold and Silver Maple Leafs Get New Packaging Gold Maple Leafs and Silver Maple Leafs are receiving packaging makeovers, changes clearly mandated by investor disfavor with packaging that the Royal Canadian Mint has used since the coins were introduced. Gold Maple Leafs debuted in 1979, Silver Maple Leafs in 1988. Options Education : Opinion versus Fact! The most basic aspect of trading is learning to differentiatebetween what is FACTUAL and what is OPINION. If you stayinterested in the financial markets long enough you willdiscover that there are a lot of sharks out there who havebecome expert at making that task very difficult. Rules for Simplified Employee Pension Plans better known as a SEP Plans A SEP is a special type of IRA. Under a SEP plan the employer creates an IRA account for each eligible employee, hence the name SEP-IRA. Advice for International Investors on How to Safeguard Their Profits What are the risks?Today, investors are increasingly turning to global markets to find opportunities for profit, giving urgency to the issue of protecting returns from foreign exchange risk. While there are many excellent investment opportunities to be found all over the world, volatility in the currency markets can and does affect the profitability of these investments. It's Not the Size of Your Bank Account You might think that if you win the lottery or get a huge raise, all your problems will be solved. Sounds logical, right? Well, it might sound logical, but it isn't. Preholiday Trading The Light Crude Continuous Contract closed at $66.13 a barrel Friday, after hitting an all-time high at $67. ![]() |
home | site map |
© 2006 |