Taking advantage of low interest rates
With bank interest rates near zero, it makes zero sense to park money, other than the emergency fund, in savings or money market accounts. On the other hand, with the rate on 30-year mortgages recently hitting all-time lows below 3%, refinancing into a 15 year...
The economy depends on your spending
It is no secret that the Nasdaq has defied all headwinds and posted phenomenal returns amidst an environment that has been nothing but gloomy - record unemployment, massive GDP hole, coronavirus cases and deaths mounting by the day and no vaccine in sight. To put it...
Is it really time to bail?
“Bubble”, “Correction”, “Overvalued” etc. are now the cool words splashing around on TV and newspapers. Of course, none of these pundits saw the 35% decline coming earlier this year, nor the subsequent 40% recovery. Yet, somehow, they want us to believe that a repeat...
Fundamentally Detached
It is not often that the stock market becomes decoupled with corporate earnings and economic indicators. In many ways, economic indicators and corporate earnings drive stock market movements. But, in the era of social distancing when the whole world has been turned...
Preparing for a negative interest rate world
On June 10, 2020, the Federal Reserve maintained its target for the federal funds rate—the benchmark for most interest rates—to a range of 0% to 0.25%. The next Fed meeting is on July 28-29 and given the recent economic indicators and the rise in corona virus cases,...
The Calm before the Storm
Investors will return from a long holiday weekend in the U.S. on Monday to what may be the calm before the storm: a relatively quiet week before a deluge of second-quarter corporate earnings reports are published starting July 13. Most observers are looking past...
What we feared is now happening..
Coronavirus cases are spiking and reopenings are being delayed. Texas Gov. Greg Abbott said the state will roll back some of its reopening measures as coronavirus cases and hospitalizations continue to rise. Florida announced it would suspend “on premises consumption”...
Can we have a vaccine, please?
Two major events occurred this week - Johnson & Johnson, which is working on a Covid-19 vaccine, moved up its expected start date for human trials to July from September. In the afternoon on Thursday, Powell revealed that the Fed could leave interest rates near...
In Search of fundamentals
The U.S. stock market’s rally since late March has been hard to take for many people—including those professional investors who stayed pessimistic too long and missed out on much of it. There’s a rueful saying among traders that markets will move in whatever direction...