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Special Guest Blog: How to Prepare Your Portfolio for the Election

The election is almost here. I often hear the following, (or something like it), "If __________ gets elected, that will really send the market into a tailspin. Don't you think I should play it safe and protect my money?" It really doesn't matter if you fill in the blank with Trump or Clinton, Republican or Democrat. Many think "the other side" will rekindle a form of country-wide dust bowl.

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Weekly Market Commentary- 06/20/17

06/20/2017
All eyes on inflation!

Inflation is the way economists measure changes in the prices of goods and services. The United States has enjoyed relatively low inflation for a significant period of time. Last week, the consumer price index indicated inflation had moved lower in May.

Inflation is our focus because it is at the core of two very different opinions that currently are influencing markets and investors.
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Weekly Market Commentary- 06/13/17

06/13/2017
Stock market historians may dub 2017 the Xanax year. Traditional historians will probably choose a different moniker.
Stock markets in many advanced economies have been unusually calm during 2017, reported Schwab’s Jeffrey Kleintop in a May 15, 2017 commentary. The CBOE Volatility Index, a.k.a. the Fear Gauge, which measures how volatile investors believe the S&P 500 Index will be over the next few months, has fallen below 10 on just 15 days since the index was introduced in 1990. Read More

Weekly Market Commentary- 06/06/17

06/06/2017
The bull market in U.S. stocks is getting really old!

In fact, this bull has been charging, standing, or sitting for more than eight years. In April, it became the second longest bull market in American history, according to CNN Money.

There are some good reasons the stock market in the United States has continued to trend higher. For one, companies have become more profitable. Read More

Weekly Market Commentary- 05/30/17

05/30/2017
Is preparing for the future more important than enjoying the present?

There is a lot to enjoy today. Last week, Financial Times wrote:

“Wall Street ended an impressive week on a steady note – eking out a tiny gain to a fresh record close – as oil prices recouped some of the previous day’s steep losses and the latest U.S. Gross Domestic Product data reinforced expectations for a June rate rise.”
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Weekly Market Commentary-05-23-17

05/23/2017
How much is too much?
There has been no shortage of drama since the new administration took office – legislative setbacks, controversial hiring and firing, and fiery tweets on various topics. Regardless, U.S. investors and markets remained stalwart until last week when the CBOE Volatility Index (a.k.a. the fear gauge) jumped 46 percent higher and markets declined.
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Weekly Market Commentary- 05/16/17

05/16/2017
Does performance tell the whole story?

American stock markets have delivered some exceptional performance in recent years. Just look at the Standard & Poor’s 500 (S&P 500) Index. Barron’s reported the S&P 500, including reinvested dividends, has returned 215 percent since April 30, 2009. The index is currently trading 50 percent above its 2007 high.
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Weekly Market Commentary- 05/09/17

05/09/2017
Is it complacency? Exuberance? Uncertainty? Exhaustion? Insight? Intuition?

Last week, all three major U.S. stock markets gained value and two reached new record highs. On the face of it, that’s great news for stock investors. However, if you look below the surface, the markets’ upward trend may have you scratching your head.
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Weekly Market Commentary- 05/02/17

05/02/2017
It was a good week to own stocks.
Not all financial news was good news last week, but that didn’t prevent U.S. stock markets from moving higher. Barron’s reported on the good news:
“This past week, welcome political news from Europe, a batch of stellar corporate-earnings reports, and a concrete tax proposal to cut corporate and some personal rates sharply gave the bull even more reasons to rally." Read More

Weekly Market Commentary- 04/25/17

04/25/2017
Last week, investors multi-tasked, pushing both U.S. bond and stock markets higher.
In March, the Federal Reserve raised the Fed funds rates for the second time in three months. Typically, we would expect interest rates to rise and bond prices to fall, but interest rates have been falling and bond prices have been moving higher. Barron’s reported yields on 10-year Treasuries hit their lowest levels since the election last week.
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Weekly Market Commentary- 04/18/17

04/18/2017
And the survey said...

In late 2016, Natixis Global surveyed 500 institutional decision makers representing corporate pension plans, public pension plans, sovereign wealth funds, insurance companies, foundations, and endowments. Survey participants said market volatility, geopolitics, and interest rates were their top risk concerns for 2017.
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Weekly Market Commentary- 04/11/17

04/11/2017
U.S. stock markets are sending mixed signals.
If you look at the performance of the CBOE Volatility Index (a.k.a. the VIX or fear gauge), which is a measure of market expectations for volatility in the near future, it appears all is well and investors expect no unexpected events. Barron’s explained:
“…which brings us back to a central fact: the absence of volatility. The first quarter was historic for the CBOE Volatility Index...It ranged from 10.6 to 13.1, and its average level was 11.69." Read More

Weekly Market Commentary- 04/04/17

04/04/2017
Happy birthday!

Toward the end of the first quarter, the bull market celebrated its eighth birthday. David Kelly, Chief Global Strategist at J.P. Morgan Asset Management wrote:

“Eight years ago, on March 9, 2009, the S&P 500 closed at 677, down 57 percent from where it had been just 18 months earlier. 10-year Treasury yields had fallen from 3.6 percent to 2.9 percent over the previous year…Investors were depressed and scared..." Read More

Weekly Market Commentary- 03/28/17

03/28/2017
You’ve read it before – and it’s true. Markets hate uncertainty.

Failure to pass the American Healthcare Act, which was supported by Republican leaders in Congress and President Trump, may have spooked U.S. stock markets last week.

In an article titled, “How To Make Investing Decisions Based On Politics: Don't,” Nasdaq.com reported controversy over the bill was “raising questions about [Republicans’] ability to focus on and pass policies that the market has been eagerly anticipating. Read More

Weekly Market Commentary- 03/21/17

03/21/2017
Three steps and no stumble…
Technical analyst Edson Gould developed a market rule of thumb known as ‘three steps and a stumble.’ It states stock prices may fall after the Federal Reserve (Fed) raises the Fed funds rate three times in a row without a decline, according to Market Technicians Association. [1]
The idea is three increases show the Fed is serious about keeping rates at a relatively high level for a significant length of time. Read More

Weekly Market Commentary- 03/14/17

03/14/2017
Rate hike ahead…maybe.

Last week’s U.S. employment report was better than expected. The United States added 235,000 jobs in February, which was a few more than economists had forecast.

It may seem counterintuitive, but the positive economic data helped push U.S. stock markets lower. The jobs report was a sign the American economy continues to be strong and indicates a rate hike may be on the horizon.
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Weekly Market Commentary- 03/06/17

03/06/2017
It was a grand slam.
Major U.S. stock markets were positively euphoric following President Trump’s speech on February 28. Optimism about the new administration’s pro-growth policies propelled the four major U.S. stock indices to record highs, despite a dearth of policy details, reported Financial Times.
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Weekly Market Commentary- 02/28/2017

02/28/2017
Once upon a time, five blind men discovered an elephant. Each man examined a different part of the elephant and formed a unique impression about the animal. One believed an elephant was like a pillar, while another decided an elephant was like a snake.

In recent weeks, stock and bond markets have been telling different stories, too.

Following a rally on Friday, the Dow Jones Industrial Average finished at a record high for the 11th time last week. Read More

Weekly Market Commentary- 02/21/2017

02/21/2017
Up!

Four major U.S. benchmark stock indices closed at record highs for four consecutive days during Valentine’s Day week, reported Financial Times (FT).

To date, positive corporate earnings and robust investor confidence have offset fiscal and political uncertainty and helped push U.S. stock markets higher, said sources cited by FT. With 82 percent of companies in the Standard & Poor’s 500 Index reporting, corporate earnings are up 4.6 percent for the fourth quarter of 2016. Read More

Weekly Market Commentary- 02/14/17

02/14/2017
What’s the word ‘phenomenal’ worth? It all depends on who says it.
Barron’s shared Wilshire Associates’ calculations which indicated the word was worth about $175 billion – the amount markets gained last Thursday – when President Trump used it to describe the tax plan his administration will deliver “ahead of schedule.” Markets gained another $100 billion in value on Friday.
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Weekly Market Commentary- 02/07/17

02/07/2017
U.S. stock markets were unsettled last week.
President Trump's executive order banning travel from seven predominantly Muslim countries to the United States for 90 days, in tandem with some disappointing earnings reports, inspired turmoil and uncertainty that helped push U.S. stock markets lower early in the week. The Dow Jones Industrial Average dropped below 20,000.
Mid-week, markets remained sanguine after the Federal Reserve left interest rates unchanged. Read More