The Income Channel

Top 5 Investment Themes to Watch for 2019

How might 2019 shape up across the investment landscape? Here’s our take on the key issues to pay attention to.

“Bad” Advice Can Add Value

I deal with many advisors. Some of them give advice that could be considered “bad,” but the benefit to their clients is tangible. Here are a few examples.

Agency MBS: Time to Rethink Prepayments

In our view, a combination of positive macroeconomic factors is likely to keep prepayment speeds higher than the market projects.

Fed Will 'Wait & Watch' Before Raising Interest Rates

Fed Chair Jerome Powell used the “patient” word again last week. He also added new words that the Fed can “wait and watch” before raising rates again. And he added another new word, that whenever interest rate increases resume, they will be “gradual.” The stock markets loved it!

Fourth Quarter 2018 - The Year When Nothing Worked

2018 will be broadly remembered as a year when nothing worked and daily stock market volatility spiked. This contrasted with 2017 where seemingly everything pushed higher, and volatility was low. But in 2018, nearly every single asset class and all but one major stock market index (Brazil) around the globe posted negative returns.

How the Mighty Have Fallen

Although the FAANGs were the poster children of the fourth-quarter market rout, losses were broad-based across sectors and countries. These losses were strong reminders of how important it is to pay attention to a company’s stock price in addition to focusing on its fundamentals and long-term growth prospects.

Is Good News Bad or Good?

With unemployment below 4% (considered full employment by the Fed) and wage inflation pressure still positive, the Fed will want to continue to remove the stimulus from its policy. This means continuing to hike interest rates, albeit it at a reduced pace from the last two years.

NAHB Housing Market Index: "Lower Interest Rates Stabilize Builder Confidence"

The National Association of Home Builders (NAHB) Housing Market Index (HMI) is a gauge of builder opinion on the relative level of current and future single-family home sales. It is a diffusion index, which means that a reading above 50 indicates a favorable outlook on home sales; below 50 indicates a negative outlook. The latest reading of 58 is an increase of 2 from 56 last month. Investing.com had a forecast of 57.

The Five Most Powerful Growth Hacks

Whether you follow a systematic approach to growth or are looking for an “easy button,” growth hacks are a path that any practice, team or individual advisor can leverage.

Dr. Jekyll Economy Meets Mr. Hyde Markets

In the famous book, Strange Case of Dr. Jekyll and Mr. Hyde, Dr. Jekyll and Mr. Hyde were one human being with a split personality. Dr. Jekyll healed people and Mr. Hyde murdered them. This economic environment and the U.S. stock market have the same kind of split personality.

What’s Next for the Dollar, Gold, Stocks & Bonds?

The quip, “if you aren’t confused, you aren’t paying attention” needs to be replaced: “with the Fed confused, you better pay attention.” You may want to buckle up. Let me explain.

Weighing the Week Ahead: Will Corporate Earnings Results Change the Message of the Markets?

It is a light economic calendar without any of the most important reports. The government shutdown will command increasing attention as long as it continues. Finally, there is some real competition in financial news – the start of earnings season.

3 Ways to Protect Clients' Investments This Year

Stock market participants for most of the past few years have eschewed protection. It was all about making large amount of gains. Almost every advisor lost clients from “cocktail party” conversations about who had made the most money recently.

Emerging Markets Outpace Developed Markets in the Final Quarter of 2018

Numerous uncertainties weighed on investor sentiment in 2018 and led to a down year for emerging markets overall, although the fourth quarter saw some outperformance versus developed markets.

The Endless Debt Fret

For the more than three decades we have been involved in analysis of the economy, one nagging constant has been pessimistic prognostications over the U.S. debt. Now once again, debt is the news de jour. Consumer, business, and government debt are all at record highs, and, therefore, the theory goes, the economy is tempting fate.