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Quarterly Thoughts – Q3 2011
By the first half of 2011, after a post-crash jump in investment prices, many disciplined investors felt a material level of financial and emotional recovery from the 2007-2009 credit crisis market. The third quarter of 2011, however, was a reminder that the bumpy road to full recovery is not yet over, as the world slipped on Greece (how about that pun!?). Small economies can sometimes be the tail that wags…
Quarterly Thoughts – Q2 2011
Who is on your side? Insightfully, when asked what his profession was in the 1979 film “Manhattan”, Woody Allen’s character responded, “I’m a stock broker. My job is to invest people’s money until it is all gone… I’m frequently wrong, but never uncertain.” Sadly, most investors still aren’t clear about the difference between securities salespeople, i.e. “brokers” or commission-based or fee-based “advisors” (i.e. accepts fees AND commissions, unlike fee-only advisors),…
Quarterly Thoughts – Q1 2011
“The only certainty is that nothing is certain” ~ Pliny the Elder, First century Roman. Despite major unrest in parts of Northern Africa and the Middle East, a massive earthquake, the subsequent tsunami and partial nuclear meltdown in Japan, renewed sovereign debt concerns in Europe, and continuing inflationary pressures in certain emerging market countries, the global economic recovery pushed on. If recent events teach us all anything, it is that…
Year-end 2010
To start the new year, let’s take a look back at 2010 from an investment perspective. For the second year in a row, stock markets rose more than the historical averages. Bonds were also positive for the year. Discipline was again important… 8 months into the year the S&P 500 Index was down 5.8%, but later surged to a 15.1% gain for the year, recouping all of its losses since…
Quarterly Thoughts – Q3 2010
Maintaining reasonable expectations, embracing the sometimes uncomfortable reality of incertitude, and living within one’s means, are fundamental to defining and achieving realistic goals. Referring to unpredictability, Benjamin Franklin once said that “nothing can be said to be certain except for death and taxes.” Behavior finance research increasingly suggests that another near-certainty is that the human brain is wired to make investment mistakes if not properly trained. WealthStep helps educate clients…
Quarterly Thoughts – Q2 2010
After feeling some recovery related relief after the market bottom in March, 2009, the bumpy last few months are making some investors nervous. Such recovery related dips, however, are not inconsistent with previous strong markets. There have been 11 bull markets since 1945, and during those markets there was a correction of 10% on average, in the 11th month of those recovery markets (this recent correction occurred in the 14th…
Quarterly Thoughts – Q1 2010
Out of the ashes rises the Phoenix – almost. The “ashes” of the financial crisis we have experienced could have given rise to a new “financial Phoenix”: a total standard of fiduciary care and responsibility by the financial industry. It almost happened when legislation was proposed which would have created such a standard. But in the end, it was defeated by powerful, conflicted financial institutions: brokerage firms and the insurance…
Quarterly Thoughts – Q4 2009
“The years teach much which the days never know” – Ralph Waldo Emerson. In the past 18 months we have witnessed the worst crisis for the global financial system since the Great Depression, the steepest stock market decline since World War II, the biggest cut in dividend payments since the 1930s, and the fastest stock market surge in 70 years. Many of the “talking heads” incorrectly predicted the beginning of…