Registered Investment Advisor
An unforgiving autumn. U.S. stock investors have been stirred once again in recent weeks from their prolonged monetary stimulus-induced coma. Since its final peak in early October, the S&P 500 Index has fallen by more than -9% to date through Wednesday’s close and by more than -11% along the way on a peak-to-trough basis. Is the decade-long stock bull market finally over? Is now the time for investors to raise cash and head to the exits?
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I sometimes wonder what the narrative of the financial media would be in a world without the S&P 500 Index. Granted, one cannot simply overlook an index that makes up the vast majority of the market capitalization of what is by far the largest stock market in the world. But if you remove this headline benchmark from the picture, the stock investing world suddenly looks like a vastly different place. And in many respects, it highlights why the next bear market in stocks has the potential to last longer and cut deeper than anything that we have seen in generations.
Please click on the link to read more of my article on Seeking Alpha.
I hate U.S. stocks this summer. It’s not to say that the asset class still does not have its place in a broadly diversified asset allocation strategy. But the increasingly sweltering heat on U.S. stocks as we move through the summer months is bound to cause some measuring melting activity. The following are 10 things I hate about U.S. stocks as we move into the summer months.
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I recently wrote an article on Seeking Alpha entitled The Next Bear Market Will Be Ruthless. The article sparked a lot of great discussion in the comment section that I enjoyed both responding to and reading a great deal. During these discussion, a topic often came up that was related to the title itself, as some questioned how a bear market might not be “ruthless.” Given that so much time in the mainstream media is focused on talking about bull markets, it is often overlooked or misinterpreted what is meant by a bear market. This is because unlike a bull market that is more clearly defined, a bear market can be defined different ways and mean different things to different people. But something as simple as understanding what a bear market represents can mean a big difference between whether you are able to tame the bear and capitalize on it or whether it mauls you into submission. For those at the ready for the next bear market, great opportunities await.
Please click on the link to read more of my article on Seeking Alpha.
It has been almost nine years since the outbreak of the financial crisis. And it has been more than seven years since the start of the most recent bull market. Stocks have been impressively resilient in the face of every test during the post crisis period thanks in large part to the seemingly endless support from monetary policy makers including the U.S. Federal Reserve. This has helped foster an environment where many investors are not only comfortable but have swagger about owning stocks at historically high valuations despite chronically slow growth. As a result, the Fed has helped create bubbles not only in asset prices but investor expectations that the principal value of their investments will be upheld no matter what challenges befall the economy. Unfortunately, just like the bursting of the tech bubble and the onset of the financial crisis, the next recession will finally come. And when it does, it has the potential to be absolutely ruthless for investors.
Please click on the link to read more of my article on Seeking Alpha.
Eric B. Parnell, CFA
