May Newsletter
Aggressive Rate Cuts End - What's Next? by Guy Baker
The period of aggressive rate cuts from the Fed comes to an end.
As expected, the Fed cut the Fed funds target rate by a quarter percentage point to 2.0 percent. . . . Forecasters and market participants are largely left in the dark regarding the Fed’s next rate move . . . -READ More-
Rick Jensen comments on Buffett
A recent article on Warren Buffett in Forbes discussed his expectation for future market returns. This article prompted Managing Director Rick Jensen to say:
If Buffett is selling puts on the S&P he obviously has some long term optimism. But I agree with him, and have always made an effort to down play any unrealistic return expectations. . . . -READ MORE-
More Americans plan on working longer and retiring later
Until recently, early retirement was a typical goal for many workers. These days anxiety over health care costs and income stability are pushing back planned retirement ages.
A survey done for MFS Investment Management found that workers planning for retirement have selected significantly high . . . -READ MORE-
Forget hot growth stocks:
Dividends determine profits
Investors these days seem to focus on growth stocks and capital gains. Yet the humble stock dividend has contributed greatly to positive stock market returns over the last 80 years.
With dividends currently at historically low levels it is easy to forget their long-term importance.
Yet almost half of the U.S. stock market’s return since 1926 has come from dividends, not from capital growth, . . . -READ More-
Male hormones & irrational trading
And you thought financial market trading success was all about smarts and experience: a new study indicates that male hormones may play a major role in decision making by successful traders. . .
Warning to retirement savers: Don’t reduce stocks as you age
M any retirement investors intuitively believe that they should reduce their exposure to stocks as they age.
After all, they have to protect their retirement nest eggs when retirement approaches and cannot afford to lose a big chunk of it in a market downturn.
Recent research by two professors at Lewis & Clark College in Oregon turns this standard investment model on its head.