GDP and Bernanke

With whisper numbers on this morning’s revision of second quarter GDP under 1%, the actual 1.6% number came to the delight of many bulls out there. Personal consumption was revised to a 2% increase from 1.6% which was a welcome surprise, although it came mainly from an increase in energy related spending. And voila, the…

“It’s More Than Luck”

“I read with interest the decision by Stanley Druckenmiller to close his global macro hedge fund. The guy was good—very good. He quietly went about his business of thinking about how the world works and positioning in front of capital flows—in or out—and got it right most of the time. It is easier said than…

Why Didn’t I Say That?

The next book on my summer reading list is The Great Reflation, by Tony Boeckh. Boeckh is the president of Boeckh Investments, Inc., and was the chairman and editor-in-chief of BCA Publications, publisher of the Bank Credit Analyst, from 1968 until 2002. Boeckh was largely responsible for building BCA into the globally respected independent research…

On the Hunt for Attractive Defensives

As the global economy continues to show signs of slowing, and risk of an economic contraction grows, we have been slowly rotating down the risk spectrum in Pinnacle portfolios. This has taken the form of reducing the overall amount of equity in portfolios, as well as some transitioning between cyclical and defensive equity sectors. Recently…

Initial Jobless Claims

Yesterday, we got a one-two punch to help send stocks lower on the session. The first economic data point to hit the street was initial jobless claims. Initial jobless claims measure the actual number of people who have filed for unemployment benefits for the first time (if they have met the five criteria for inclusion).…

When Active Management Matters

This blog may be a little geeky, but bear with me here. In the March/April Financial Analysts Journal, Roger Ibbotson, along with James Xiong, Thomas Idzorek, and Peng Chen, published an article called, “The Equal Importance of Asset Allocation and Active Management.” For those who don’t know, Roger Ibbotson is a giant in the field…

Navigating the Range

Back on June 24th, I wrote that we wouldn’t be surprised if stocks remained mostly range-bound between 1,040 and 1,150 on the S&P 500 through the summer (http://echoesfromthepit.blogspot.com/2010/06/range-bound.html). Except for a brief dip below 1,040 in late June/early July, that’s how things have played out up to this point. Of course, the overall sideways trend…

The Three Hundred Pound Gorilla in the Room

…Or is it the elephant in the room? No matter. The investment team spent the day last Friday pouring over economic data and a host of other security related issues, only to decide that the outlook remains either “mixed” or “muddled.” Senior Analyst Carl Noble is writing our monthly market review and as of this…

The Paradox of Thrift

There was good news buried in the GDP report released last week. Based on large revisions to previous data, the U.S. savings rate is now above 6%. This level of savings makes sense in a world where U.S. consumers are presumably engaged in repairing their balance sheets by paying down debts and increasing their savings.…

Fed Day

Today brought the long awaited meeting of the Federal Reserve’s Open Market Committee. Investors were watching very intently, as for weeks there have been rumors that the Fed might institute a new round of quantitative easing. Many have postulated that any new stimulus from the Fed was already discounted in the market, and some were…