The Black Cloud Still Looms Large

The oil market continues to search for any signs of life. Since June 2014, oil prices have fallen by nearly 60%. And while both West Texas Intermediate and Brent crude prices are still trading above the lows from earlier in January, the trend remains definitively down. This bodes ill for capital markets in general and the high yield bond market in particular.

Please click on the link to read more of my article on Seeking Alpha.

Fires Still Burning In The Oil Patch

The massive decline in oil prices over the last several months has clogged the headlines. Investors certainly have no shortage of opinions to sift through in trying to determine how the recent events in oil might impact the economy and financial markets going forward. Such viewpoints range from those predicting widespread negative spillover effects to others celebrating the boost to the economy and the attractive investment opportunities now available across the energy sector. This can leave many investors feeling confused about what actions if any they should take in response. At times like these, it is often helpful to begin by taking the simplest approach, which is to look at what prices alone are telling us. So far, they suggest that fires are still raging across the oil sector and that more challenges may lie ahead.

Please click on the link to read more of my article on Seeking Alpha.

Has QE3 Really Come To An End?

In October, the U.S. Federal Reserve carried out its final asset purchases as part of its latest asset purchase plan designed to help stimulate economic growth. This included the purchase of $10 billion in U.S. Treasuries and $5 billion in Mortgage Backed Securities in the final month. Given that the program is now over, it would be reasonable to expect that the Fed’s balance sheet would not longer be expanding in a meaningful way. But this has not been the case in the weeks since the end of the program. As a result, it is reasonable to question whether QE3 has really come to an end.

Please click on the link to read more of my article on Seeking Alpha.

This Is How A Bear Market Starts

We are now in the sixth year of what is the third longest U.S. stock bull market in history. At this advanced bull market stage, some investors are understandably concerned about how much higher stocks can go from here. This leads to the following natural question – how will I know when the bull market has finally ended and a new bear market has gotten underway? Fortunately for those that are interested, today’s stock market is providing a live and active case study right now that is demonstrating exactly what it looks like when a bear market is just getting started.

Please click on the link to read more of my article on Seeking Alpha.

The Black Bear Is Unleashed

A black bear has been unleashed on capital markets. After having been adrift for several months, oil has been cascading relentlessly lower since late November. But despite the recently severe downward pressure on the energy sector, many are suggesting that this will be a short-lived and isolated blip. And in a still raging bull market for U.S. stocks, the pullback in energy shares represents just the latest opportunity to suddenly buy “deeply discounted companies on the dip.” Perhaps. But a number of characteristics make the sharp decline in oil and energy shares notably different from what so many have grown accustomed over the last six years. In short, the recent struggles in the energy sector may not only go on much longer than many are anticipating, but these downside forces have the potential to spread across the broader market.

Please click on the link to read more of my article on Seeking Alpha.


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