The Independent Market Observer

Brad McMillan, CFA®, CFP®

Brad McMillan, CFA®, CFP®, is managing principal, wealth management, and chief investment officer at Commonwealth. As CIO, Brad chairs the investment committee and is a spokesperson for Commonwealth’s investment divisions. Brad received his BA from Dartmouth College, an MS from MIT, and an MS from Boston College. He has worked as a real estate developer, consultant, and lender; as an investment analyst, manager, and consultant; and as a start-up executive. His professional qualifications include designated membership in the Appraisal Institute, the CFA Institute, and the CAIA Association. He also is a CERTIFIED FINANCIAL PLANNER™ practitioner. Brad speaks around the country on investment issues and writes for industry publications, as well as for this blog.
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Recent Posts

The Consumer: The Real Engine of the Economy

July 31, 2019

Last week, the economic growth numbers came in stronger than expected, largely due to the strength of consumer spending. At the same time, concerns remain about the slowdown in business investment. Given these conditions, it occurred to me that now is a good time to look at the economy as a whole, to see exactly what it consists of—and what that view might tell us about the future.

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Fed Set to Cut Rates for the First Time Since 2008: Hooray?

July 30, 2019

There has been a great deal of coverage about the expected rate cut by the FOMC at its regular meeting this week. Markets are counting on a cut of 25 bps (one-quarter percentage point), which has pretty much been confirmed by the Fed. There is even some betting that the cut will be twice as much. In any case, this move has been widely cheered as a necessary precaution—an “insurance cut” in the jargon—to prevent an economic slowdown from turning into something worse. If we step back and look at the big picture, though, there is less to cheer about.

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Economy Continues to Confound the Doubters

July 26, 2019

With this morning’s report on economic growth, we see that the economy has beaten expectations once again. Markets anticipated growth would drop from 3.1 percent in the first quarter to 1.8 percent for the second quarter. Instead, the first estimate is for growth of 2.1 percent. That number doesn’t sound like a major difference, but it’s actually a big deal. Let’s take a look at why.

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Appearance on CNBC’s Power Lunch, July 25, 2019 [Video]

July 25, 2019

The European Central Bank has signaled for a possible change in monetary policy. What could this mean for the markets and investors? I discussed the risks and more today on CNBC’s Power Lunch.

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Will Boris Johnson Get Brexit Right?

July 25, 2019

Today, I’d like to continue the discussion of yesterday’s post on the need to understand what is happening elsewhere in the world. So, let’s take a contrarian look at Brexit and the recent elevation of Boris Johnson to the head of the British government.

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The West and the Middle World: A Review of Destiny Disrupted, by Tamim Ansary

July 24, 2019

For quite a while, the U.S. was focused on other parts of the world. Wars in the Middle East, the Greek crisis, and North Korea all made headlines and were front of mind for many investors. Recently, though, that view has largely faded. We are still at war in Afghanistan, but no one seems to be talking about. A hard Brexit is looming, same thing. Attention has returned to what is happening here in the U.S.

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Deal on Spending and Debt Ceiling Is Good News for Economy

July 23, 2019

This morning’s announcement of the deal between Congress and the White House to suspend the debt ceiling for the next two years is undiluted good news. With an agreement that the government can borrow to spend the money that it has already committed to spending, we can avoid a totally unnecessary, politically driven crisis that could have caused real economic damage. Assuming the deal actually gets passed and signed, it would remove the only near-term roadblock to continued expansion here in the U.S. Like I said, this is definitely good news.

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What Earnings Recession?

July 19, 2019

The term recession is having a moment. There is talk of a manufacturing recession, an earnings recession, and, the big one, an economic recession here in the U.S. Worry has been rising with the headlines of slower growth, especially with the recent inversion of the yield curve. Recession is a bad, bad word.

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Are We Seeing Signs of Peak Growth?

July 18, 2019

In retrospect, a good candidate for demonstrating the peak of the boom may be yesterday’s announcement by Netflix that subscriber growth came in well below expectations during the second quarter: the number of subscribers was up by 2.7 million against expectations of 5.3 million. Worse, in its most developed market (i.e., the U.S.), subscriber numbers were actually down by 126,000, against an expected gain of 310,000. This marks the first time the company has ever seen a decline in U.S. subscribers.

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Debt Ceiling Crisis Heating Up

July 17, 2019

An issue I have been mentioning for the past couple of months is finally starting to get some attention: the U.S. is facing a potential crisis as the government runs out of money. Sometime this fall, likely in September, the government won't have the funds to pay its bills.

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