The Federal Open Market Committee put out its press release today at about 2:15 EST. The committee, currently made up of 10 members, meets 8 times a year to assess financial conditions and determine monetary policy. The Federal Reserve’s primary function is to pursue a dual mandate of full employment and price stability.
With the advent of Exchange Traded Funds (ETFs), we have raised the question of how to best manage fixed income on multiple occasions. Since our inception, we have used individual municipal and government bonds when we felt there was value in that asset class. This is very normal in the institutional world, and has served…
The Homebuyer‘s Tax Credit officially expired on April 30th. Over the last few weeks, we’ve started to get a sense of the impact on the housing market without this government support from some of the latest housing data, and the evidence is troubling. Below is a list of some of the latest developments:
The Euro and S&P 500 don’t have a very high correlation over a long period of time. In non-geek speak, that simply means that the movement in one does not translate to a movement in the same direction of the other all that often. For a quick lesson in correlation, statistically, a correlation of 1…
Since the S&P 500 hit its recent peak of 1,217 on April 23rd, it’s fallen by 13% through yesterday’s closing price of 1,055. It violated (fell below) its longer-term term 200-day moving average on May 20th, and has traded below that important trend indicator since then. Along the way, 9 out of the 10 broad…
Eight times a year, the Federal Reserve formally comments on current economic conditions in a report commonly called the Beige Book (so named based on the color of its cover). It contains information gathered by each of the twelve Federal Reserve districts, and contains one national summary from the district reports. The book centers on…
As I wrote in a recent entry, the bulk of our mental energy is concentrated on puzzling through whether or not fear is driving this market, or whether we are being given signals that fundamental change is occurring. Recently, we have been scouring important data points and reassessing the very core of our thesis. I’ll…
Sometimes you just get a feeling, and it’s not easy to put into words exactly what is generating it, but your gut is telling you that something just isn’t quite right. Yesterday the investment team was discussing the “oogy” feel that the May 6th “flash crash” left behind. Beyond the actual loss on the day,…
Looking at stock market volume statistics over the last few weeks has not given me much confidence in a resumption of the bull market. In a healthy bull market we would like to see strong volume on up days and/or weak volume on down days. This general pattern is regarded by technicians to be a…
Over time, the price of gold typically has a fairly strong inverse correlation with the value of the U.S. dollar, meaning that they tend to move in opposite directions. But lately the dollar and gold have been moving higher in lockstep as the long-term inverse correlation has broken down (see chart below). There are a…
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