The Independent Market Observer

More Thoughts on Retirement Investing

April 29, 2016

Following up on yesterday’s post, let’s take a look at how the income approach to retirement investing might play out in practice. (I'd like to acknowledge David Rosenberg of Gluskin Sheff, whose recent newsletter inspired this topic.)

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Thoughts on Building a Retirement Portfolio

April 28, 2016

Since I turned 50, the idea of investing for retirement has taken on significantly more relevance. Not that I plan on retiring soon, but there’s something about the big 5-0 that makes you think it might not be so far off.

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3 Prime Suspects in the Slow Economic Recovery

April 27, 2016

In yesterday’s post, I mentioned that lower government spending has been a big factor in the slow U.S. economic recovery. But it’s not the only culprit. Today, we'll take a look at three major headwinds to economic growth and whether they're likely to continue going forward.

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Why You Should Stop Worrying About Slow Growth

April 26, 2016

This afternoon, I’m speaking to a group of investors on the subject of worry—worry about the economy, about investments, and about meeting their financial goals. A couple of years ago, we were worried about high oil prices, China taking over the world, and a weak dollar, to name a few. Now, of course, we’re much wiser: we worry about low oil prices, Chinese collapse, and the strong dollar.

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Monday Update: Housing Data Weak But Momentum Still Positive

April 25, 2016

Last week’s economic reports were, once again, weaker than expected. Housing news was mixed, with industry sentiment remaining healthy but failing to improve while starts pulled back. On the other hand, sales of existing homes jumped, reversing a decline in the previous month.

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The Risk of Higher Oil Prices

April 22, 2016

oil pricesYesterday, I wrote that the U.S. economy, especially on the jobs side, remains basically healthy and even strong. At the same time, risks around the world seem to be receding. Chinese growth looks like it’s picking up, Europe also seems to be responding to central bank stimulus, and most of the things we were worried about over the past six months haven’t turned out so bad.

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The Employment Boom Is Pretty Much Here

April 21, 2016

For well over a year, I’ve been saying that job growth is not quite in a boom, but you can see one from here. After all that time, I think that we’ve largely arrived.

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New York Primary Results Should Help Reassure Markets

April 20, 2016

In my post last week about the election and financial markets, I wrote that it was too early to worry about what the candidates are likely to do if elected. That remains true, but the New York primary results suggest it’s not too soon to think about what the rest of the race might look like—and what that might mean for the economy and the markets.

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How Much More Expensive Can the Market Get?

April 19, 2016

After 15-percent pullbacks in both the first quarter and the middle of last year, the market is moving up toward new highs. The Dow just ticked above 18,000 for the first time since last July, and the S&P 500 is getting close to the 2,100 level, last seen in December. All-time highs are 18,351.36 for the Dow and 2,134.72 for the S&P 500, so we are getting close.

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Monday Update: Weaker Than Expected

April 18, 2016

Last week’s economic data was unexpectedly weak, with disappointing news on both retail sales and industrial production. Although forward-looking indicators are improving, the past week’s numbers suggest that the economy hasn’t yet moved beyond the slowdown.

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How High Are Taxes, Really?

April 15, 2016

At a conference last month, I had a discussion with a group of people who were deeply convinced that their taxes were as high as they’d ever been. I mentioned that solving the budget problems of the U.S. would require higher taxes—which wasn’t intended as a recommendation but simply a recognition of the math. The group maintained that it was impossible to raise taxes any further without crippling the economy.

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Economic Growth and the $15 Minimum Wage

April 14, 2016

I'm grateful for the many reader questions I've received recently—thank you all very much. Today, we’ll address another one: What does the prospective increase in the minimum wage mean for the economy, and how does that tie into recent slower growth in wages?

This is an excellent question, as it combines several important issues—hiring, wage growth, inequality, and economic growth— into one picture.

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Appearance on CNBC's Power Lunch, April 13, 2016 [Video]

April 13, 2016

I was on CNBC’s Power Lunch today, talking with host Brian Sullivan about where the market can go from its current near-record high.

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The Election and the Financial Markets

April 13, 2016

Along with Puerto Rico, the other topic readers have been inquiring about is the presidential race and the effect on the markets. Yesterday, someone asked whether she should go to cash until the political uncertainty settles down. The short answer is no, but the question itself speaks to just how concerned people are about politics.

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Puerto Rico's Debt Crisis: Much Ado About Not Much

April 12, 2016

Per a reader's request, today we'll talk about the impact of the current debt crisis in Puerto Rico. Not only is this a major issue for the Puerto Ricans and their investors, but it also sheds light on how similar crises are likely to play out in the future.

You might want to pay attention to this movie, because you will be seeing it again over the next several years—probably more than once.

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Appearance on TheStreet, April 10, 2016 [Video]

April 11, 2016

Is Wall Street in for a pleasant surprise during this quarterly earnings season? I recently sat down with Rhonda Schaffler, anchor of TheStreet TV, to discuss earnings expectations and the economy.

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Monday Update: More Slow Progress

April 11, 2016

Once again, last week’s economic news was relatively positive.

Although the industrial sector continued to struggle, manufacturing showed further signs of stabilization, and the service sector actually improved. Net exports continued to be a weak point, driven by economic weakness abroad. (The Federal Reserve highlighted this as the major source of risk in the March meeting minutes.) Nonetheless, the fundamentals continued to show slow improvement, suggesting that the economy is moving out of the slowdown of the past two quarters.

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Where Will Economic Growth Come From?

April 8, 2016

I wrote yesterday that economic growth has historically been significantly affected by the growth of the population, and how that offers some (but not a lot) of encouragement over the next 10 years. It will help, but not as much as we need.

Another way to look at recent economic growth is to consider where that growth came from, and to see whether those trends offer any prescriptions for how we can accelerate the economy.

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Everybody's Worried About Growth

April 7, 2016

As you can see from the clip I posted earlier today, I spent yesterday in New York. One of the things I try to get from these days in the field is to identify overarching concerns and themes, and this time that was easy. The main concern of almost everyone was growth—growth in the economy, growth in earnings, and growth in general.

Time after time, I got the same question: where is the growth going to come from?

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Appearance on CNBC's Closing Bell, April 6, 2016 [Video]

April 7, 2016

Yesterday afternoon, I was on CNBC's Closing Bell from the floor of the New York Stock Exchange, forecasting earnings to come and discussing current market conditions with hosts Bill Griffith and Kayla Tausche. 

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Stock Market Earnings Priced for Disaster (But Not to Worry)

April 6, 2016

We're heading into earnings season, when companies announce how much they made last quarter. This is when I start reviewing current market expectations and how they relate to the fundamentals.

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Economic Risk Factor Update: April 2016

April 5, 2016

Once again, it’s time for our monthly update on risk factors that have proven to be good indicators of economic trouble ahead. On the whole, some of the worrying downward movement has reversed, suggesting that risks may be starting to retreat. The change in consumer confidence metric remains below zero, but even that may be stabilizing. We’re also seeing some signs of stabilization in other areas, such as the yield curve indicator.

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Monday Update: Slow but Real Economic Improvement

April 4, 2016

Last week’s economic news was positive overall.

Consumers continued to save rather than spend, but signs of increasing confidence suggest that may change. U.S. business, on the other hand, signaled widely improving confidence, especially in the industrial and manufacturing sector. Finally, employment growth continues strong and is starting to attract discouraged workers back into the labor force even faster—a very encouraging development.

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Market Thoughts for April 2016 [Video]

April 4, 2016

In my latest Market Thoughts video, I discuss the markets and economy in March. After two bad months, everything appears to be moving in the right direction, as markets were up about 7 percent across the board, and even foreign markets fared well. 

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Monthly Market Risk Update: April 2016

April 1, 2016

It’s time for our monthly look at market risk factors. Just as with the economy, there are several key factors that matter for the market, in determining both the risk level and the immediacy of the risk. Stocks have largely recovered from their recent pullback, but given valuations and recent market behavior, it will be useful to keep an eye on these factors.

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