Can the Data Be Trusted?

Just two days ago the 4th quarter GDP came out as a negative number, which was much worse than expected. In fact, not one of 83 analysts had anticipated a negative number, meaning they were all too bullish on the 4th quarter growth number. But yesterday the Chicago Purchasing manager’s index, a growth barometer, was…

What If Fear Fades?

In my last column, I described a bearish scenario where the markets come to the realization that the monetary authorities are out of bullets. This was simply an exercise in critical thinking and doesn’t actually line up with our current forecast, and I did promise I would come back with a bullish scenario.

Now What?

One of my favorite scenes in the Pixar movie Finding Nemo comes at the end. The fish had managed to outwit the Dentist (who was holding them captive in a tank) by dirtying the water enough to force a water change. In order to do that, the Dentist had to bag the fish and leave…

Trouble with the Numbers

Few people bothered to see Trouble with the Curve, a recent baseball movie starring Clint Eastwood and Amy Adams, and most critics didn’t like it. I did see the movie, and without giving away the plot, it is fair to say that the film is a cry against quantitative analysis in sports. Eastwood plays an…

The Bulls and the Bears on QE4

The Federal Reserve spoke yesterday, and not surprisingly decided to buy more treasury bonds to keep expanding the balance sheet. It might have been a bit surprising that they have now also explicitly targeted an improvement in the unemployment rate (6.5%) and stated a tolerable inflation band (2.5%) for investors to use as guides for…

Golden Crosses and Death Crosses

It is commonplace in the business news community to talk about ‘Golden Crosses’ and ‘Death Crosses’. If you’re unfamiliar with these terms, they refer to moving averages (MA) crossing each other. More specifically they describe the movement of a security’s short term MA moving above the long term MA (Golden Cross) and the short term…

Ten Years of Active Investment Management

October 31rst marked the ten-year anniversary of Pinnacle’s Global Investment Performance Standards (GIPS) compliant track record. That’s a big deal in the institutional investment community — it means that we’ve met the GIPS standard for reporting performance (often required by institutional investors). It also means that we have a legitimate ten-year track record, which is…