The Independent Market Observer

4/30/14 – Weak First Quarter: A Surprise, But Not to Worry

April 30, 2014

Economic growth came in well below expectations this morning, at 0.1 percent instead of the 1.2 percent generally expected. Ouch. Is this something we should be worrying about?

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4/29/14 – Off to Hawaii

April 29, 2014

I’m at the airport on my way to the Commonwealth President’s Club conference, so this will be a brief post. As I’ve written many times before, I love these conferences for a bunch of reasons—the venues, the events, and, most of all, the people.

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4/28/14 – Which Economic Statistics Are Worth Looking At?

April 28, 2014

You can spend all day, every day, looking at and analyzing the plethora of economic and market data. I know, because that’s pretty much what I do. What you find after a while, though, is that much of this information is either redundant or meaningless (or apt to be revised so much that it might as well be).

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4/25/14 – Confidence and Earnings

April 25, 2014

Consumer confidence will play an increasingly important role in supporting stock prices as earnings show signs of rolling over.

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4/24/14 – Six Views of the Initial Jobless Claims Data

April 24, 2014

Today’s post is inspired by Thirty-Six Views of Mount Fuji, a series of woodblock prints by the Japanese artist Hokusai that depicts the same scene from various perspectives, yielding very different images. Data can be viewed the same way, with various angles giving different impressions and potentially leading to very distinct conclusions.

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4/23/14 – Should We Worry About the Housing Slowdown?

April 23, 2014

The headline for this morning is that new home sales are down more than 14 percent on a month-to-month basis. This comes in tandem with drops in mortgage applications and a much smaller drop, of less than 1 percent, in existing home sales. With rates up, and demand potentially declining as institutional buyers pull back, is it time to worry that the housing recovery is over?

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4/22/14 – Some Thoughts on Capital in the Twenty First-Century by Thomas Piketty

April 22, 2014

A caveat about this post: I haven’t yet read the book, so this is neither a review nor a real engagement with Piketty’s arguments. I’ll get to that—I just ordered the Kindle version, and have a couple of very long plane rides coming up, which should be ideal.

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4/21/14 – Spring Is a Great Time to Read P.G. Wodehouse

April 21, 2014

I’ll be honest with you; I don’t have a lot to talk about today as far as economics and the market go. The recovery continues, markets are back in the trading range of the past six weeks or so, and there simply is not a lot to write about today.

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4/17/14 – Why Financial Advisors Are the Good Guys

April 17, 2014

My son, Jackson, is almost six, and we are starting to have conversations about what Daddy does for work. Since he is also at the age where we spend an inordinate amount of time talking about good guys versus bad guys—particularly in the context of Star Wars—this also tends to bleed over into other areas. So, of course, it got me thinking about where we, as an industry, stand.

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4/16/14 – What Happens When Interest Rates Rise? Part 3: The Effects on Investments

April 16, 2014

This is the last installment in our series on rising interest rates. Here, we’ll cover what everyone really wants to know: What do rising rates mean for our investments?

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4/15/14 – What Happens When Interest Rates Rise? Part 2: What’s Keeping Rates Low, and What Happens When It Stops?

April 15, 2014

Yesterday, we discussed what the natural rate of interest should be, arriving at about 5 percent on a nominal basis, assuming 2-percent inflation. That seems like a reasonable number over time, given that the Federal Reserve has committed to an inflation target of 2 percent. But with interest rates currently at much less than 3 percent, there’s clearly a gap between what the rate should be and where it is now.

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4/14/14 – Interview on CNBC's Closing Bell

April 14, 2014

Check out Brad’s April 10 interview on CNBC's Closing Bell.

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4/14/14 – What Happens When Interest Rates Rise? Part 1: The Natural Interest Rate

April 14, 2014

I admit I was waiting to see what the markets did before I wrote this post, but now that things seem to be bouncing back, we can move away from worries about stocks and back to worries about bonds. All worries, all the time—that’s the Eeyore channel! (For those who don’t know, I’ve been called Eeyore occasionally because of what some perceived as a dour outlook. I’ve certainly been more cheerful recently, at least about the economy.)

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4/11/14 – It’s a Fender Bender, Not a Crash

April 11, 2014

For some reason, we are experiencing a new wave of doom and gloom. In the past week, I’ve been forwarded several e-mails rehashing end-of-the-world stories, including an invitation to watch a video entitled Meltdown America. When I was interviewed on TV yesterday, the clear theme of the questions was whether this was it, the big crash.

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4/10/14 – Up and Down and Up and Down

April 10, 2014

Summer is coming, finally, and we have a nice day outside. Of course, summer means amusement parks and, as Jackson gets older, Dad taking him on rides. I miss the days of the rocket ships that went in gentle circles—now we are moving on to the teacups and the roller coasters that make you regret that hot dog you ate very much.

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4/9/14 – Banks Pay More, Medicare Pays Less?

April 9, 2014

I’m back in the office today with no overarching story, but a lot of items worth a look.

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4/8/14 – Market Declines: What’s Your Plan?

April 8, 2014

I’m headed back from a brief vacation today. My family and I were at the Commonwealth Winners Circle conference, then ventured down south of Tucson to stay with Jackson’s Gram and Pop-pop. It’s been a fun couple of days—I particularly recommend the Desert Museum—but today will be spent on planes. That’s the plan.

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4/7/14 – Market Turbulence Means Investors Should Pay Attention

April 7, 2014

Friday was a scary day in the markets, as pretty good economic news was met with a downturn in stock prices. The S&P 500 dropped 1.25 percent, and the Nasdaq dropped a scarier 2.6 percent.

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4/4/14 – The Snowdown Is Over, Spring Is Here

April 4, 2014

The data is coming in, and it appears it was the weather after all. The jobs report showed a gain of 192,000 (slightly below expectations but still quite healthy), the unemployment rate remained steady at 6.7 percent (which is actually better than it looks), and private employment hit a new all-time high—all very good signs for the future.

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4/3/14 – The Trend Is Your Friend

April 3, 2014

I’m at the Commonwealth Winners Circle conference this week, talking with our financial advisors and having a wonderful time. The Arizona weather is a huge improvement on that of many parts of the country, which is lightening everyone’s mood. Even as we enjoy the better weather, though, one of the questions that keeps coming up is whether the current positive trends in many areas will continue, or change, and how will we know? Is the better economic weather transitory, or is spring really on its way?

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4/2/14 – High-Frequency Trading and the Average Investor

April 2, 2014

I got a good question from Matt Parsons about yesterday’s post—essentially, what does high-frequency trading (HFT) mean to the average investor? If you’re retired, living off your investments, do you need to worry? This is an excellent question—thanks, Matt!

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4/1/14 – High-Frequency Trading and Market Trust

April 1, 2014

The New York Times has an excerpt from Michael Lewis’s new book, Flash Boys, which is essentially about how the stock markets have become rigged. There will be a tremendous amount of debate on whether his charges are fair, what actions should be taken, and so forth—the FBI has apparently already launched an investigation—but to my mind, this somewhat misses the point.

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Market Thoughts for April 2014 Video

April 1, 2014 

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