About Me

Retired chief investment officer and former NYSE firm partner with 50 plus years experience in field as analyst / economist, portfolio manager / trader, and CIO who has superb track record with multi $billion equities and fixed income portfolios. Advanced degrees, CFA. Having done much professional writing as a young guy, I now have a cryptic style. 40 years down on and around The Street confirms: CAVEAT EMPTOR IN SPADES !!!

Tuesday, October 15, 2019

That's All Folks

In late September, I turned 80. According to Wall Street lore, this counts as a life well lived for
an investment guy. The most important thing I've learned so far about being 80 is the you have
to become more inventive if you want get around decently well. But learning the fine art of
compensating for advanced age is a time consuming endeavor as I am finding out. So it seems
to me like a good time to step out of the capital markets milieu. And, there is the view I have
that both bond and stock prices are bloated and now not interesting. I also think that the vast
gulf between the folks who are financially loaded and the rest of mankind is unsustainable
over time at least here  in the US. If I was a betting man, I would say that the bloats we now
see in the markets and in wealth disparity are going to be corrected over time, at least here in
the US. I hope these evening out processes are not born out of economic, financial and social
disaster, but my guess is they are on their way over the next couple of decades come what may.
I wish all the many readers of this blog so long and good luck.

Sunday, October 13, 2019

Easy Does It

Confronted by weakening PMI data and tightening liquidity in the financial markets, the Fed has
reverted to another QE effort. It will buy substantial amounts of 3 month T-bills at least for the
intermediate term. As the Fed again expands its balance sheet, some funds will invariably leak
into the money supply, likely further adding the growth of the real money supply. This is a plus for
the stock market as is the Trump team's effort not to intensify the trade war with China. These
developments will help the economy although the timing in the shorter run is necessarily
imprecise give the continued deterioration in the US economy, especially in the industrial sector.
The return of QE adds significantly to inflation potential if the economy re-accelerates in growth
in the months ahead.

The 2020 national election is still more than a year away. The House seems ever more likely to
impeach Trump as soon as it can plausibly do so, but the Democrats still must settle on a
candidate and a platform to put in opposition. As of now, investors appear to favor a moderate.
Trump is presently expected to survive an impeachment trial in the Senate but could still crash
and burn by election day anyway. So, even if the economy revives somewhat, there still may
be some heavy clouds for pundits to grapple with even so.