Commodity Prices are Rising–Is It A Supercycle?

Broad equity markets have rebounded strongly from last year’s pandemic-induced recession, but they’re not the only asset class seeing strong gains.1 Commodities are on the upswing, too. As of last week, the Bloomberg Commodity Spot Index was up over 60% from the pandemic lows touched last March, and even still, many individual commodities have not […]

Will Value Stocks Outperform Growth in 2021?

Growth stocks have been on a tear. Over the last 10 years (through 2020), the Russell 1000 Growth Index has delivered an annualized return of around +17%, while the Russell 1000 Value Index has annualized about +10% over the same period. Strong performance in both categories, but a clear winner in growth. Many readers know […]

What Will the Economic Recovery Look Like?

The unpredictable nature of the pandemic and vaccine rollout have complicated economic forecasting models in 2021. Consumer behavior is very difficult to predict, and corporations are reluctant to overcommit to earnings forecasts in 2021. Indeed, over the past six months, CEOs have been all over the map in statements about when the economy could normalize […]

Investor Frenzy is Nearing a Tipping Point

Readers of this column are likely aware of some of the bizarre events transpiring in the equity markets today. Among them, stories of Reddit chatrooms driving short squeezes and massive single-day moves (in both directions) in companies with relatively weak fundamentals. If parts of the environment feel like the 1990’s dot-com bubble to you, I’m […]

Should We Be Worried About U.S. Debt Levels?

Over the past four years, U.S. government debt held by the public has swelled from about $14 trillion to over $21 trillion. Debt as a percent of U.S. GDP now tops 100%, meaning our debt exceeds our annual output. Debt as a percent of GDP has not been this high since World War II (chart […]

Will Inflation Make a Comeback in 2021?

In the years following the 2008-2009 Financial Crisis, many analysts and pundits warned of rising inflation. Central banks around the world had expanded their balance sheets by the trillions, and it was believed that a seemingly endless amount of quantitative easing (QE) would surely result in inflationary pressures down the road. But runaway inflation never […]

Will the Bull Market Continue in 2021?

2020 was a year beset by a public health crisis, civil unrest, political dysfunction, and uncertainty across just about every facet of life. Yet the S&P 500 still posted a stout +18.4% return for the year, following a powerful +31.5% surge in 2019.1 Never mind the fact that there was a global pandemic, more political […]

Are We at the Top of this Market?

The S&P 500, Dow Jones, and Nasdaq indices all finished 2020 at or near all-time highs.1 What’s more, “risk-on” sentiment also ended the year with somewhat of a bang – investors borrowed a record $722.1 billion on margin through November 2020, and individual investors opened more than 10 million new brokerage accounts in 2020 (a […]

3 Market Trends for 2021

The stock market delivered a fairly wild ride in 2020, with a steep bear market arriving in record time followed by a strong and sustained rally that caught many investors by surprise. In my view, 2021 will represent the first full year of the new cycle, which almost always has tactical and strategic implications for […]

4 Reasons for Investors to be Hopeful in 2021

There’s no sugar coating it – 2020 was a tough year. The country confronted a once-in-a-generation pandemic, a major service-sector driven recession, a divisive and contentious election cycle, and social tensions of many different stripes. Multiple issues seemed to collide all at once. I won’t weigh-in on social or political issues here, but from an […]