Economic Data Tepid, But Policy Actions Supportive
Back in early 2009, most current economic data was weak. However, good investment (and our discipline) focuses on looking forward, through the windshield of the car and over the horizon, rather than through the side windows. At that time we felt that policymakers, both at the central bank and within government, were determined to stimulate growth. And stimulate they did. Growth accelerated and the stock market rebounded strongly in the ensuing 3½ years.Download PDF
U.S. Stocks Remain The Toughest Benchmark
Despite agonizing doubts about European recession, a global slowdown and earnings concerns, U.S. stocks had a strong third quarter and generated a handsome total return in the first nine months of the year, leading most asset classes globally.
From a valuation perspective, stocks remain attractively priced relative to the current level of earnings. Nevertheless, earnings growth is more uncertain. We’re scrutinizing both economic performance and policymaker actions throughout the world, but especially in Europe and emerging markets.Download PDF
Fixed Income Portfolios
Another Shot In America’s Economic Arm
The Federal Reserve introduced another round of quantitative easing, which appeared specifically aimed at reducing mortgage rates. As has happened after previous Fed announcements, some pundits immediately predicted hyper-inflation. We study inflation from many angles and also place it in a historical context; hyper-inflation is not a threat we see in the current or near-future economic picture.Download PDF