Potential Pitholes of 2019
The January Absolute Return Letter is always about the pitholes one could fall into in the year to come and, lo and behold, financial markets are behaving as if we have already fallen into one. December was a most difficult month, and January hasn't exactly started with all guns blazing either.
Bear Markets, Fed Mistakes, and Quick Shots from John
Today, we’ll address several things, so think of this as my year-end “Quick Shots from the Frontline.” It will be more like a personal, from the heart, fireside chat. (Trigger warning: I will be taking off my politically correct gloves. Naming names and pointing fingers. Just Uncle John telling it like it is.)
Powell, the Third Mandate, the New Fed and Crawdads
I am going to offer some different thoughts than the mainstream media spin on Jerome Powell, his press conference, and the Federal Reserve.
Northern Trust: The Six Themes that Will Drive Markets
Bob Browne is an executive vice president and chief investment officer for Northern Trust, which had $1.1 trillion in assets under management as of September 30, 2018. In this interview, he discusses his firm’s capital market outlook and the six themes that will drive investment returns over the next five years.
Southeastern: A Compelling Time to Invest Outside the U.S.
Josh Shores serves as a principal and director of Southeastern Asset Management, Inc. He is a manager of the Longleaf Partners International Fund (LLINX). In this interview, he discusses why the biggest, broadest and deepest opportunity set for investing is outside the U.S.
Is 1% Dead and Gone? With Scott MacKillop
Does the emergence of new technologies such as TAMPS and roboadvisors have to mean a deflated revenue stream for financial advisors? Not necessarily. Join me and my guest Scott MacKillop of First Ascent Asset Management as we discuss the new model for managing assets and how advisors can make it work for them without becoming poverty stricken.
Why Facet Wealth Wants to Buy Your Small Accounts
Anders Jones is CEO and co-founder of Facet Wealth, a next-generation financial services firm reinventing financial life management for the mass affluent. In this interview, he discusses how his firm partners with advisors to help them provide financial planning and investment advice for their smaller clients.
The Five Challenges Facing Advisors in 2019
After talking with hundreds of advisors and interacting online with thousands more, I’ve identified five ominous challenges the profession will face and trends it will need to adapt to in the coming year.
Freezing Temperatures Could Heat Up Natural Gas Prices
Natural gas storage in the lower 48 states was below the five-year average as of October 31, according to the EIA. This, combined with a stronger-than-expected start to winter, prompted traders to push prices to a four-year high of $4.84 per MBtu. Meanwhile, natural gas futures trading hit an all-time daily volume record of 1.2 million contracts.
Are You Paying for Liquidity You Don't Need?
Advisors should look more closely at their clients’ investments as well as portfolio design from a liquidity perspective. Investors, particularly those with long-term goals, may be paying for daily liquidity they don’t need. By ignoring liquidity premiums, advisors are not maximizing the funds of their clients.
US Midterm Elections: The Base Case Scenario and the Implications
The national midterm elections are today. As of yesterday morning, Nate Silver’s FiveThirtyEight website is giving the Democrats an 85.6% chance of taking the House of Representatives and the Republicans an 85.6% chance of keeping the Senate. This forecast should be no surprise; the president’s party almost always loses House seats in the first midterm election...
Will Lithium Sink OPEC?
Electrification of all transportation and heating is already a trend in motion, and it is going to change everything. The arrival of fusion energy will only make those changes even more dramatic. Commercial banks may cease to exist, fossil fuel prices will fall dramatically - some may even go to zero - and OPEC may be replaced by OLEC - the Organisation of Lithium Exporting Countries.
A New Dawn for Brazil?
Anti-establishment candidate Jair Bolsonaro prevailed as expected in Brazil’s presidential election on 28 October, having run on a socially conservative “more Brazil, less Brasilia” platform. This included promises to reduce corruption, increase security, allow gun ownership and oppose the legalization of abortion. It was the first time since 2002 that Brazil’s Workers’ Party (PT) did not win the presidency.
Debt Alarm Ringing
Debt is future spending pulled forward in time. It lets you buy something now for which you otherwise don’t have cash available yet. Whether it’s wise or not depends on what you buy. Debt to educate yourself so you can get a better job may be a good idea. Borrowing money to finance your vacation? Probably not.
Market review Q3 18: Give me an “L” (for liquidity)
Investors who view market opportunities exclusively through the lens of recent strong economic performance risk misreading a pivotal event. The tide of liquidity is turning and will bring asset prices down with it.