Looking Forward provides us the opportunity to update our clients on recent developments and share our thoughts on current trends in the stock market and the economy. Produced quarterly, Looking Forward discusses our experiences as we apply our consistent, individual-company approach against an ever-changing backdrop.
December 31, 2017 – “Both rotation scenarios seem reasonable enough. After all, a lot of smart people work in the investment business, and part of what they do is extrapolate the likely ramifications of current events into potential future outcomes. Still, there’s good reason to use words such as “likely” and “potential” when describing that exercise.”
September 30, 2017 – “The good news is investors don’t seem to be worried about matters of macro concern. That’s right, confronted with a multiplicity of menace, the stock market in the three months through September was, in a word, subdued. Not quite tranquil. Perhaps orderly. The CBOE Volatility Index (VIX), commonly known as Wall Street’s “fear index,” ended September within a whisker of its all-time low.”
June 30, 2017 – “What if banks were less regulated or energy producers could extract and transport resources with fewer restrictions? A $1 trillion infrastructure plan – that must be good news for engineering, construction, materials and so on, right? All along, as many investors posited the beneficiaries of their government-inspired wish list, we embraced an assumption that stems from a different sort of question: What if none of this stuff happens?”
March 31, 2017 – “The role of interest rates in the economic recovery seems an unshakable theme for influencing attitudes toward stocks. But continuing to focus on the Fed’s interest rate intentions misses the bigger point that [Federal Reserve Bank of San Francisco President John] Williams sought to convey: The recovery is over.”
December 31, 2016 – “Even generalizations about the current state of stocks themselves make the case for a selective approach. Valuations are high. Earnings look weak. Neither is universally true. Given the backdrop, exceptions should draw positive attention. That’s encouraging to us because our investment approach, at its core, is a search for exceptional companies.”
September 30, 2016 – “Attack ads, press coverage, polling numbers and the rest of the standard election-related noise will increase in volume with each passing day until it comes time to vote. Running parallel with similarly increasing purpose is Wall Street’s election-handicapping machine, outlining various scenarios should voters lean one way or the other. To be sure, it’s important to listen.”
June 30, 2016 – “There’s no choice but to wait and see. Europe’s second largest economy is leaving the EU, likely to the U.K.’s detriment to some degree. To what degree hinges on how amicably the parties can manage Brexit and subsequently redefine the U.K.’s relationship with the remaining 27 member states. It’s in the EU’s best interest to do all it can to ensure this is a one-off occurrence.”