The Leveraged and Inverse Funds Channel

Quarterly Letter

Despite another interest rate hike in June by the Federal Reserve that raised the target federal funds range to 1.75-2.00%, along with plenty of increased tariff talk and (some) implementation by the Trump administration, the investment world was relatively calm in the second quarter of 2018.

June Jobs Report: 157K New Jobs, Unemployment Rate at 3.9%, Worse Than Forecast

This morning's employment report for July showed a 157K increase in total nonfarm payrolls, which was worse than forecasts. The unemployment rate decreased to 3.9%. The consensus was for 193K new jobs and the unemployment rate to drop to 3.9%.

The Danger in Private Real Estate Investments

A question I’m often asked involves the merits of investing in private real estate as an alternative to publicly available REITs. To answer that question, I will turn to the historical evidence.

Revisiting Corporate Credit amid Market Volatility

In 2018, rising inflation, higher US interest rates and escalating trade tensions have led to concerns about global economic growth and bouts of equity-market volatility.

Public Companies Disappearing - Investors Lose Opportunities

Most investors are not aware of this but the number of publicly-traded companies listed on US stock exchanges has plunged almost 50% since the peak in 1996. This phenomenon is not limited to the United States.

Investment Humility and Economic Recovery

We make every effort to understand the way that investors go to extremes over what we call the “well-known fact” in the stock market. A “well-known fact” is a body of economic information which is known to virtually everyone in the marketplace and has been acted on by anyone with capital.

2018 3Q Economic Capital Market Outlook

The domestic economy is functioning as well as any period since 2007, however we expect economic growth to slow next year. Measured by GDP, we expect the economy grew by a solid 4.0% in the second quarter and is growing at a rate of 2.7% with most sectors performing well.

Debt Hangover Looms After US Borrowing Binge

US companies, lured by historically low interest rates, have taken on massive amounts of debt in recent years. As rates begin to rise, investors should beware of companies that might be vulnerable to increasing financing costs.

The Long Runway for Infrastructure Spending

Infrastructure is not a glamorous topic — it isn’t satirized on late-night TV, nor is it trending on social media. But the need for increased infrastructure investment is real across the globe. Given expected demographic trends, disruption by new technology and insufficient spending in the past, we at Invesco Real Estate believe infrastructure-related companies could be poised for decades of growth.

Report from Turkey: Cheap Asset Prices May Not Be Cheap Enough

Turkish asset prices have plummeted this year, bringing their valuations to historically low levels. That presents potentially attractive opportunities to investors looking for quality stocks at bargain-basement prices. Yet some selloffs don’t necessarily end with stocks and bonds at oversold levels if their prices largely reflect current or near-term risks, both company specific and macroeconomic.

Preserve The Federal Reserve’s Independence

The Northern Trust Economics team tracks China’s fiscal policies and exchange rate volatility, and reacts to recent comments that undermine the Fed’s independence

Endgame Strategizing

Last week I gave you some rules to follow with your investments. They were necessarily general because I’m writing to a broad audience. Today, I will get more specific by discussing some possible strategies for high-net-worth “accredited investors.”

Visualizing GDP: An Inside Look at the Q2 Advance Estimate

The accompanying chart is a way to visualize real GDP change since 2007. It uses a stacked column chart to segment the four major components of GDP with a dashed line overlay to show the sum of the four, which is real GDP itself. Here is the latest overview from the Bureau of Labor Statistics.

Margin Debt and the Market

FINRA has released new data for margin debt, now available through June. The latest debt level is down 3.3% month-over-month. The June data gives us an additional sense of recent investor behavior.

25 Real-Life Examples: How High Valuation Can Hurt Investors, Let Me Count the Ways

It almost every article I have ever published, I talk about valuation in one manner or another. So much so, that readers have dubbed me Mr. Valuation. The primary reason I am so obsessed about valuation is because I believe it is one of the most important and yet mostly ignored and overlooked concepts in the investing world.