The Independent Market Observer

5/27/14 – Taxes Are Going Up, Inch by Inch

May 27, 2014

I ended last week on a note of shared sacrifice. This week, let’s talk about some of the forms that sacrifice will likely take.

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5/23/14 – Memorial Day Reflections

May 23, 2014

One of the joys of being a father is explaining to Jackson things that I, as an adult, take for granted. Today, we’ve been talking about Memorial Day—not as the start of summer but as a time to remember those who have died so we can live in freedom.

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5/20/14 – Interview on CNBC’s Worldwide Exchange

May 20, 2014

Check out Brad’s May 20 interview on CNBC’s Worldwide Exchange, where he offers his thoughts on recent U.S. equity market growth and Treasuries.

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5/19/14 – How to Use Moving Averages to Avoid Stock Market Losses

May 19, 2014

One of the major causes of stock market losses is unforeseen declines that make people sell out—often at the worst time. This is one of the reasons I’ve focused much of my recent research on using drawdown (instead of return variance) as a measure of risk. In my opinion, it provides a better metric for real-world investment performance.

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5/9/14 – How to Turn P/E Data into P/E Information

May 19, 2014

The first question you might have, upon seeing that headline, is what’s the difference? Data is simply facts, without meaning or context. Information can be used as a basis to make decisions; it can be acted on.

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5/16/14 – What Can Cycles Tell Us About Investing?

May 16, 2014

If you ever want to be amused, get a cat to watch an ink-jet printer while it’s at work. I now have a laser printer at home, which still seems to fascinate the cat, but there’s no comparison to the ink-jet. Something about the print head scurrying back and forth under the cover must remind them of a mouse . . .

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5/14/14 – Back to the Old Normal

May 14, 2014

There are no blockbuster news stories today, but several items play into the theme of how “old normal” things have become.

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5/13/14 – The Federal Deficit Continues to Improve

May 13, 2014

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5/12/14 – Markets Probably Headed Even Higher

May 12, 2014

As I write this Monday morning, stocks are up quite a bit on the day, with the S&P 500 pushing even closer to a new all-time high. The headline on Google Finance reads “U.S. Stocks Advance Amid Deals on Optimism Over Economy,” and all seems right with the world.

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5/8/14 – Southeast Asia Heats Up as Ukraine Cools Down

May 8, 2014

The markets seem to be rallying as the Russians dial down the Ukraine confrontation. After a couple of dips, it looks like we’re edging back into a risk-on mode, with Putin apparently deciding that he has what he needs and it’s time to back off.

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Certain sections of this commentary contain forward-looking statements that are based on our reasonable expectations, estimates, projections, and assumptions. Forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties, which are difficult to predict. Past performance is not indicative of future results. Diversification does not assure a profit or protect against loss in declining markets.

The S&P 500 Index is a broad-based measurement of changes in stock market conditions based on the average performance of 500 widely held common stocks. All indices are unmanaged and investors cannot invest directly in an index.

The MSCI EAFE (Europe, Australia, Far East) Index is a free float‐adjusted market capitalization index that is designed to measure the equity market performance of developed markets, excluding the U.S. and Canada. The MSCI EAFE Index consists of 21 developed market country indices.

One basis point (bp) is equal to 1/100th of 1 percent, or 0.01 percent.

The VIX (CBOE Volatility Index) measures the market’s expectation of 30-day volatility across a wide range of S&P 500 options.

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