Market Commentary January 2013
Financial markets did very well in 2012, with stocks returning 16%-18%, which is significantly above long-term averages. During the fourth quarter markets seemed to cling to an assumption that the fiscal cliff would be averted, or at least end in something less than a catastrophe. Domestic stocks ended the quarter very close to where they […]
Top Ten Money Excuses
Human beings have an astounding facility for self-deception when it comes to our own money. We tend to rationalize our own fears. So instead of just recognizing how we feel and reflecting on the thoughts that creates, we cut out the middle man and construct the façade of a logical-sounding argument over a vague feeling. These arguments […]
The Fiscal Cliff: Why Selling Now Is Not Always The Best Strategy
The daily fiscal cliff news coverage is causing irrational investor behavior regarding unrealized long-term capital gains (LTCG). Without congressional action the LTCG rate is set to increase from 15% in 2012 to 20% in 2013. In addition, high earners are subject to a 3.8% Medicare surtax applied to all capital gains. (income greater than $250,000 […]
Controlling Costs – A Financial Recipe for Success
I have seen people drive miles out of their way for the cheapest gas, shop at multiple grocery stores for the best prices, and even wake up at uncanny hours to receive the best deals on holiday presents! As consumers we are always looking for a good deal, and price is one of the largest […]
Global Equity Valuations
The global equity markets continue to experience disappointing returns. In discussions with clients, my advice is a reminder that the research shows that developing a strategic asset allocation plan and staying the course through rebalancing is the prudent course of action. The European sovereign debt crisis is in its third year and continues to create […]
Four Ways the Financial Media Causes Investors Harm
ONE: Focus on the near term. A recent headline reads, Anxious financial advisers scale back summer vacations. “Still haunted by the 2008 financial crisis, many financial advisers are scaling back their summer vacations or giving up on them entirely. Many are afraid to be out of the office in case this is the third straight […]
Market Commentary July 2012
Equity markets had a rough second quarter. For the period ending June 30, 2012 the S&P 500 index (large stocks) was down 2.8%, the Russell 2000 index (small stocks) was down 3.5%, and the MSCI EAFE index (international stocks) was down 6.9%. The international index might have seen a double-digit decline were it not for […]
What About Bonds?
Bonds will be a terrible investment over the next 10 years. That is the conventional wisdom in the investment community lately. “Bonds are the worst asset class for investors,” says Professor Burton Malkiel, the author of A Random Walk Down Wall Street, in an opinion piece published in late March in The Wall Street Journal. […]
Market Commentary April 2012
Equity markets got off to an outstanding start in 2012. Returns for the first three months represented the best yearly start since 1998, as the S&P 500 was up 12.6%. As you can see in the chart, equity markets were generally up 11%-13% with emerging markets up 14%. The broad bond market essentially broke even […]
The 2012 Income Tax Season Observations
I haven’t come across many new issues this tax season, but, as usual, a few surprises have popped up. Make Work Pay Credit Gone Many are disappointed with the amount of refund or amount owed compared to last year, primarily due to the elimination of the Make Work Pay credit that could be as great […]