Like anyone who works with investments and Wall Street, I definitely have something of a pro-business perspective. One of the great things about Commonwealth, though, is that while we deal with Wall Street, we’re not a Wall Street firm. We’re a Main Street firm, working with independent advisors who have ordinary people as clients. 

This gives me a slightly different perspective on the world than many of my colleagues at other firms. I speak with our advisors almost every day, and directly to and with their clients on a regular basis. While Wall Street can be disconnected from reality, here at Commonwealth, we do our best to avoid that.

In the past couple of days, I’ve read several articles in the newspapers and in professional forums denouncing the notion of market timing. They say, quite correctly, that no one can time the market and call the ups and downs. Very true. They also say that various market timing tools won’t generate higher returns consistently. Again, very true. They conclude that it makes no sense to step back from the stock market occasionally to assess market conditions.

Let’s put this analysis in a different context, though, and see if that conclusion makes sense. Forget the stock market, let’s talk about the weather—specifically, hurricanes.

What do I think about the S&P 500's break above 2,000? Hear what I discussed with CNBC Worldwide Exchange in an interview today, August 27.

The S&P 500 has set another record, closing above 2,000 for the first time yesterday. Hooray.

I want to be excited, I really do. But I just can’t get there, and I don’t seem to be alone. The press has noted it, without much fanfare. The market itself doesn’t seem all that jazzed.

Why the ennui? I suspect it’s because this may not be a real rally, but one driven by low volumes, senior staff on vacation, and other less-than-exciting factors. After Labor Day, we should get a better look at what investors really think.

Looking into the relationship between interest rates and stock market valuations, I’ve found two very interesting points that have a direct bearing on our investments.

First, the valuation metric you use matters. As you may remember, I prefer a cyclically adjusted price/earnings ratio, or Shiller P/E, over a P/E based on only 12 months of data. When you compare the relationships with interest rates, among other factors, it’s very clear that the Shiller P/E has the better economic foundation; not only is it more intuitively sensible, it’s also a better analytical tool.

As we discussed last week, market crashes (defined as drops of 30 percent or more) have become more common recently, while the smaller declines known as bear markets (drops of about 20 percent) have become less so. With two major crashes in the past 10 years, it seems like a good idea to examine some of the factors that preceded them.

Are there any warning signs that we should be keeping an eye out for?

Yesterday, we talked about the latest prediction of doom—this time, a 67-percent decline in the stock market in the next 18 to 24 months. Unlike most doom-saying, which isn’t supported by any actual data (the collapse of the dollar, for example), arguments for a significant market decline are based on a number of very real facts, many of which I’ve discussed in the past.

I've never really examined the situation of a crash itself, however. What would a crash mean, and how would it likely play out?

Yesterday, I received a question from Joe Esposito that touches on some very relevant demographic-related issues:

“How do you feel about Harry Dent's prediction of a Dow 5,500 and the next big crash starting within the next 24 months or so? Just curious on your take regarding his demographic viewpoints and positioning with booms and busts. (Highs are higher and busts will be lower than that last.) Thoughts?”

When I speak to groups in various parts of the country, I often hear that things there don’t reflect the national employment averages and trends I talk about. This usually leads to some interesting discussions about why that might be the case.

The problem with looking at region-specific trends is the lack of research in that area. So I was glad to discover a recent report by Deloitte University Press that breaks out some numbers on a regional basis, with interesting results.

One of the advantages of a slow summer season is that we can spend some time on topics that are important but not urgent. Demography is a great example. It determines most of the context in which the economy operates, but its trends play out over years and decades. Like the weather, demographic trends are just there, and we have to adjust to them.

Simply looking at the U.S. population distribution can give us some insight into what will happen over the next 20 years or so, as well as what’s happening right now.

As I wrote in my last post, oil prices have stayed lower for longer than many would have expected, and we may see prices drift lower still as supply continues to outpace demand.

Some of the effects of lower prices are obvious, but others aren’t. Let's take a look at who stands to benefit from continued low prices—and who may not fare so well. 

As I write, the financial markets are dropping on fears that the situation in Ukraine is about to escalate. This doesn’t come as a surprise, and, frankly, it’s not very interesting from an economic point of view.

More striking is that oil prices have continued to decline despite this turmoil and everything else that’s happening around the world, particularly in Gaza and Iraq. Down more than 2 percent this morning, crude prices are at monthly and quarterly lows, and they're getting very close to annual lows as well.

Yesterday, we talked about how the U.S. government deficit, while improving, is still way too high, posing serious problems for the future. Today, I want to touch on two other problems that you might think have been solved—but haven’t.

Part of the return to normal for the economy and the financial markets has been a decline in interest—or at least media coverage—of the national deficit and debt.

Though understandable, this is a mistake, as the deficit and debt remain a serious problem for the country in the medium to long term.

Following up on yesterday’s post, I want to look at two areas of the investment world that have a lot to say about how we invest our money—and how we make our profits.

One of the keys to business success is sustainable advantage, often referred to as a competitive “moat.” In short, if you have something your competitors can’t duplicate, you can charge for it and make money.

The idea typically centers on things that protect products. Think of patents, or the kind of ecosystem of software, hardware, and content that Apple, Amazon, and Google are building, at a cost of billions of dollars.

Yesterday, I wrote that banks starting to lend again is a plus for the economy. Today, I want to take a closer look at a key assumption underlying that statement.

Much of modern society revolves around consumption, and there's nothing wrong with that—if it’s affordable. If not, we find ourselves in 2009 again.

The real question here is what affordable means. In fact, this is the question at the core of saving, investing, retiring, and pretty much everything else I write about here. 

The headlines today are all about the deal between Bank of America and the government. After months of negotiation, the bank will pay about $17 billion to resolve allegations that it didn’t follow the rules for residential mortgages before the financial crisis. 

No company likes to pay out billions of dollars, and BofA had a good case that it didn’t do nearly as much wrong as the government claimed. (Many of the allegations involved actions committed by companies that the bank acquired at the government’s urging during the crisis.) Nonetheless, the BofA deal should be a good thing for the bank—and the rest of America.

Learn why I told CNBC Worldwide Exchange that I think the Fed's tapering of its bond-buying program is a good thing for the financial sector in an interview today, August 7. 

When I go on vacation, I do so with the expectation that something will happen that makes me (almost) want to be back in the office.

Sure enough, while I was out last week, the market proceeded to sell off in a way that has become pretty uncommon recently, generating fear and worry.

In my latest Market Thoughts video, I talk about the U.S. economy, international turmoil, and the U.S. market's performance at the end of July.

It’s time for our monthly update on factors that have proven to be reliable indicators of economic trouble ahead.

As expected, the data hasn’t changed that much from last month—it’s encouraging in almost all areas—but it remains important to keep an eye on things.  

I'll be out of the office for a few days, so I'm revisiting some of my past posts. (Today's originally appeared in September 2013.) Look for a new post tomorrow!

When I last wrote about inflation, in January 2013, it wasn’t a pressing concern. I did note that we’d have to start paying closer attention when three things happened:

• A decrease in the unemployment rate
• A resumption of bank lending/consumer borrowing
• Faster growth in GDP

We’re seeing all three of these now, so it’s time for another look.

I'll be out of the office for a few days, so I'm revisiting some of my past posts. (Today's originally appeared in July 2012.)

One of the great perks of my position at Commonwealth is the chance to talk with experts in a wide range of fields. A couple of years ago, at our Chairman’s Retreat, we heard from a speaker who specialized in the psychology of happiness.