Understanding actual inflation – instead of what the media’s narrative tells you it should be – is critical to your investment planning. It is one thing for a pundit to say this or that, but it is another to look at the actual data for yourself.
It was inevitable. Certain pieces of the market roared to insane valuations last year. Investors poured money into the markets and speculated stocks would keep rising forever. But, sentiment has shifted.
I will again join forces with Ed Easterling of Crestmont Research to explore this data more deeply. Currently we have several powerful trends that have combined to create a nirvana-like market.
Today we are going to revisit that matrix updated through 2024. We will see what we got right and wrong, what further inferences we can now make and why I think it confirms my general shift in market strategy over the past few years.
None of us outside Trump’s inner circle know what the real goals are. What looks like needless chaos might lead to benefits that outweigh the costs. One potential benefit is revenue. Could the tariffs produce significant tax revenue that would help reduce the federal debt? The president seems to think so.
My friends like to make fun of me by taunting that I don’t like to commit to things. I’m constantly trying new hobbies. I don’t like to make plans too far in advance because something more exciting might pop up. I don’t even like to renew my car tags for more than one year.
Trump Confusion Syndrome, or TCS, is distinct from Trump Derangement Syndrome in which afflicted people feel outrage about everything the president says or does. TCS isn’t about agreeing or disagreeing. It’s mostly about understanding. And then when something still seems wrong, feeling free to say it out loud.
It’s mid-February and earnings season is in full swing. All I really want to know is if Mr. Market is going to be my Valentine… or not. Earnings data hits, political comments are made, and investors react. The CNN Fear & Greed Index is at dead neutral.
Today we’ll talk about Trump, tariffs, cycles, and DOGE. Jumping right in…
This is not about China. I applaud the creativity of the DeepSeek developers and especially their ability to drive down costs. I am amazed they made it truly open-source and revealed everything.
The first month of 2025 will soon be behind us. We’ve seen new inflation data and earnings season start to ramp up.
The Second Trump Era has begun. If you are confident about what it will bring (either good or bad), I would like to gently suggest you reconsider. None of us should be sure what is coming.
Last week in my 2025 forecast letter, I predicted A Partly Cloudy Year, generally mild but with occasional storms. Today we’ll talk about the second half of that sentence. What could go wrong and lead to a worse-than-expected year? In short, what are the main risks to my forecast?
Everybody has an opinion about quantum computing lately. Last week Nvidia CEO Jensen Huang suggested we were 15–30 years away from “useful” quantum computing
Rough times are coming, yes, but I think we have at least 12 good months before the worst gets here. Let’s look at some of the reasons why things should be okay and then look at some of the potential problems.
Since dividend investing can be boiled down to a single strategy—generating income—you might assume we don’t need a toolbox full of tools. We know that’s not true.
Most people don’t pay much attention to the political process, either local or federal. This year I think it is something we should all be paying attention to as it might affect our various lives.
I expect three major innovation cycles to dramatically affect our world in the next decade, with impacts comparable to steam engines, electricity, automobiles, and even the internet. Every new invention helps us explore even further.
I must confess, I have been aware of quantum computing for quite some time, but it was one of those things that always seemed far off. It’s now getting much closer.
Taxes are on my mind. Do I factor in whether a dividend is considered qualified or ordinary when making my recommendations?
Energy is everything. Or, if Einstein was right, you and I are just energy in material form. Accelerate us to lightspeed squared and we might become something else.
Collectively, we’re spending more and more on Christmas each and every year. This happens despite concerns about the economy and politics—and the fact that US credit card delinquencies continue to climb higher. So, how does this put more money in our pockets as dividend investors?
Whether you want to buy or rent, finding an affordable, comfortable home can be extremely difficult, if not impossible.
The question on “everyone’s” mind, whether the back or the front, is where will the stock market be in two, three, six years?
Politicians and think-tank wonks of all stripes love to condemn government “waste, fraud, and abuse.” But saying it isn’t hard. Who is the opposition? No one says we need more waste, fraud, and abuse. We’re all 100% agreed all three are bad.
I’ve been looking for the best dividends in the market for over 13 years. Time after time, I keep coming back to this question.
Two weeks ago, I opened this letter by noting the election uncertainty, once over, would give way to a different uncertainty about what comes next. That’s where we are now.
One of the core principles of a long-term dividend portfolio is to invest in companies that are integral to society and will be for many years to come. Transportation falls into that category.
I went to bed “early” on election night, around 10:30 pm. We are in the five months of the year where Puerto Rico is one hour ahead of Eastern time, and nothing I was seeing made me think it would be an early night. And by that I meant 3 or 4 am.
Anyone else ready for the election to be over? This uncertainty is exhausting, no matter how you want it to end. But sadly, it won’t really end. We will just transition to a different uncertainty over what will happen next. I will offer my thoughts on the election at the end of this letter, after setting the stage.
We don’t talk about China enough. I suspect this is for several reasons. First, because the country is so incomprehensibly big and populous. Second, it has been an economic miracle. Many Chinese enthusiasts just see a straight line projection of their growth. To the moon, Alice!
Housing prices matter to everyone, even if you aren’t trying to buy, sell, or rent a home. They are the key to inflation, which drives Fed policy and interest rates, which drive financial markets. We’re all part of this, like it or not. Today we’ll review what is happening.
The markets saw a fifth straight week of gains last week. The S&P 500 closed above 5,800 for the first time, the Dow hit a new record high, and the Nasdaq came within 2% of its all-time high.
Everything I’ve learned and experienced in 50+ years of watching the economy tells me not to expect a soft landing. But maybe that’s because I’ve never actually seen one.
Earnings season usually lasts around six weeks, so this wave of data will take us almost to Thanksgiving.
It’s my birthday week and I have guests and family gathering in the next room, so this will hopefully be a quick letter as well as ending with what will likely be controversial food for thought.
Two weeks ago, I began reviewing Martin Gurri’s important book, The Revolt of the Public. Rather than try to do a general review, I am going to liberally quote from Gurri’s book and interviews, trying to let him explain himself in his own words.
I’m moving up a letter I was planning to share with you on my birthday weekend in two weeks. The story about sandpiles and the financial system may be the most popular letter I’ve written in the last 25 years. It is one we should all re-read every few years to remind us how change happens slowly, then suddenly.
In my cycles book I’m reviewing the forecasts of Neil Howe, Peter Turchin, George Friedman, and Ray Dalio. For different historical reasons and patterns, all see a crisis culminating at the end of this decade. Some readers have legitimately pushed back, saying no one knows the future.
We are entering a time I think will include a deep crisis. We are going to need each other. We really do need to “find our tribe.”
I asked my great friend and business partner David Bahnsen, who is about as politically wired as anyone and one of the truly great economic and investment minds, to reflect on the intersection of politics and markets. It is a quick, balanced, and reasonable read...
Many recent studies have been done on the economics of different generations. Researchers want to know if Millennials and Gen Z are in fact worse off than their Boomer and Gen X parents. There are quite a few ways to look at this data.
This week we take a not-so-random walk through the data, trying to simplify what is actually a fairly complex subject. I think it is quite fun, but also important. Let's dive in.
Head fake is a trading term, too. Some bit of information convinces investors a market is going to move a certain way. They reposition their portfolios accordingly… just in time to find out the information was wrong. Oof.
As much as my two-pronged dividend strategy works in all markets, we still need to acknowledge that politics influences the market. Sometimes it’s a tangible impact like big swings in the price of oil. Other times it’s just investor sentiment moving the market.
I can't let this month pass without noting a significant anniversary: This is the 25th year I’ve been writing Thoughts from the Frontline. You can visit the archive and see every issue since January 2001.
Copper prices have pulled back since peaking in May at $5.12, but the long-term bull case for copper remains strong.
The Federal Reserve is between the Rock of Gibraltar and the Rocky Mountains. The data they use to explain their policy choices is in apparent transition. A self-aware analyst, seeing the conflicting data, knows that the right policy choice will only be understood in hindsight.
We have been talking about resiliency-driven inflation for the past several weeks. As the US and its Western allies realign supply chains to strengthen economic resiliency, the cost of certain goods and commodities will go up.
Progress toward a goal usually isn’t linear. The first 50% isn’t too bad, the next 40% is harder, and the last 10% consumes most of the effort and resources. Business strategists call this the “last mile” problem… and it applies to inflation, too.
