While the current sell-off is in line with previous major bear markets of the postwar period, it is extreme in its speed and volatility. Precedent would suggest that markets will remain under pressure for the immediate future, but unless you assume we are on the verge of a 1930s’ style bust, equities are poised for…
While many pundits expect the financial sector’s problems to remain “contained,” we not only expect the bear market to spread beyond financials, but believe the economic damage may be greater than that inflicted during the downturn of 2000–03.
Despite low valuations, U.S. financial stocks will likely remain a “value trap” until greater clarity emerges as to the ultimate magnitude of losses facing the financial system.
After years of supporting share prices and EPS growth with increasingly aggressive share-repurchase programs, companies are showing signs of buyback fatigue.
While the Fed is committed to a policy of reflation, market conditions pose significant obstacles to success and there are also serious inflationary risks associated with this policy.
Deleveraging, insurance woes, and liquidity concerns deliver pitfalls and opportunities to taxable investors.
A look at what history tells us to expect as the earnings, business, and stock market cycles converge.
While we remain bearish on high-yield bonds in general, experienced and talented managers should have a plethora of profit opportunities as spreads widen and defaults rise.
We continue to view U.S. equities as overvalued based on both valuations and the difficult economic environment, but advocate tactical bets within U.S. equities rather than a substantial underweight.
Narrow market participation and weak financial shares may spell more trouble after the November jolt.