The Fault is ours, Ray

According to Forbes Magazine, Ray Dalio, founder of Bridgewater Associates, is America’s second richest money manager. He trails only George Soros in the pantheon of hedge fund “masters of the universe”. Dalio appeared last month on CBS “60 Minutes” to lament the demise of the American dream. He called inequality…

The Fed’s in waiting mode

With a third of the year over already, much of the market volatility encountered in late 2018 is fading in the rear-view mirror. While the China trade dispute has reemerged recently as a top risk for investors, markets are still generally positive for 2019. Brexit and uncertainty about future Fed…

Vladimir Ilyich Trump

“The issue of paper money is the worst kind of compulsory loan… It worsens the conditions principally of the workers, of the poorest section of the population.. It is the chief evil in the financial confusion.” —Vladimir Lenin No stranger to institutional thievery, Lenin would have no trouble recognizing the…

The Inversion Aversion

Most of 2018 played out according to plan in the bond market. Early in the year market strategist expected faster U.S. economic growth, higher inflation and a Federal Reserve that might be “behind the curve” in its efforts to head off inflation via higher interest rates. Tax cuts, healthy job…

Train Spotting

My first boss told me something years ago about the bond market that I’ll never forget. He said, “never stand in front of a moving train.” I think about it every time I trade. He meant that if interest rates (the train) start to move quickly in one direction and…

The Pottery Barn Economy

Back in 2002, then U.S. Secretary of State Colin Powell had a very blunt and direct way of framing the dilemma over invading Iraq. He called it the Pottery Barn rule: “You break it, you bought it,” he said. Powell’s phraseology ultimately proved prophetic - presaging a painful chapter in American…

Headwinds

The second quarter of 2018 revealed little news in the bond market, as the generally range-bound trading that marked previous quarters remained in place. On May 11th, the yield on the 10-year U.S. Treasury bond reached 3.11 percent, and it appeared that interest rates were headed higher on the back…

The asteroid and the portfolio manager

Fidelity Investments has finally done it. The large Boston-based fund manager recently cut the management fees on two of their index-oriented stock mutual funds to zero—nada—NOTHING. Their arch rival Vanguard Group pioneered cheap, index-based investing in 1974. Forty-four years later, after decades of competitive innovation, fee-cutting and marketing hocus between…