Insights

Insights

Unknown, Knowns

Recently a podcast host referenced a Charlie Brown comic book strip where Marcie, Linus, and Charlie Brown are lying on their backs looking at the clouds. Each character is asked what they see, and they all describe something wildly different. It’s easy to draw parallels to this comic book strip and how our central bank, […]

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Side Stepping the Wall of Worry

“Forecasts create the mirage that the future is knowable.” -Peter Bernstein, Economist1 Thirty-eight economists were polled by Bloomberg mid-December 2022 and asked to share their forecast on the odds of a recession in 2023. Seventy percent believed the US would enter a recession in 2023.2  This poll, while only one measure, was reflective of a […]

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Rates Versus Seasonals

“Sell in May and Go Away” is an old stock market adage drawing attention to the seasonal weakness that typically occurs during the summer months relative to other time periods of the year. The origin is believed to date back hundreds of years to when investors would step away to enjoy the summer with loved […]

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Crisis to Mania

While mania and panic often follow one another, it’s difficult to recall experiencing both in one quarter, such as we did in the second quarter of 2023.  From the regional banking crisis to the current artificial intelligence (AI) mania, during the quarter the market swung from fear to elation. We have several dispassionate opinions on […]

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Order of Magnitude

Order of magnitude, which is an exponential change relative to a value or quantity, is often difficult to conceptualize. The world functions logarithmically, but as humans we are programmed to think linearly. To fully appreciate the effect of rising interest rates and the impact on markets, it’s helpful to consider the magnitude of the change […]

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The Year That Needed to End

One challenge as an investor is recognizing that returns are lumpy. Ideally, to achieve an +8% annualized return, stocks would glide upwards on a smooth path of +8%, +8%, +8% each year, for example. Unfortunately, the market is often more like a roller coaster with a return path of +15%, -12%, +25% to achieve that […]

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Is Inflation Peaking?

Bull markets are a lot more fun than bear markets.  This has been an understatement in 2022.  Though bear markets are normal events, we have had our share of market declines over the last 4 years.  The violent correction in the 4th quarter of 2018 was fast and quick.  The Covid panic of 2020 was […]

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Interest Rate Regime Change

With all the news on the war in Ukraine, supply chain disruptions and rising commodity prices, it is easy to overlook what we believe is the most critical issue facing investors going forward, the regime change in interest rates. For almost all our careers we have invested in an environment of falling rates.  In fact, […]

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Outlook and Observations

What a surprising and wonderful year 2021 was for investors. We don’t know anyone who predicted or expected even close to the two years of returns investors have experienced, with a 28.7% total return of the S&P 500 in 2021, following the 18.7% return in 2020.1 The global pandemic and the subsequent response have changed […]

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