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.
September 30, 2018 – “It’s not so much what the Federal Reserve Bank said in the statement issued after its Open Market Committee meeting on September 26. The usual stuff, like the reminder about the Committee’s statutory mandate and the update on the risks to the economic outlook, was there in the familiar, dryly delivered pronouncement. But something was missing.”
June 30, 2018 – “We’re a lot less concerned about PCE (personal consumption expenditures) or CPI (consumer price index) than we are about EPS (earnings per share). That’s another way to say our strategy prompts us to account for inflation on a case-by-case basis, gauging the extent to which inflation affects each company’s earnings outlook.”
March 31, 2018 – “Stocks corrected abruptly in late January and early February when, within days of each other, the Federal Reserve telegraphed a slightly more aggressive stance on interest rates and the Labor Department reported a jump in average hourly earnings. Inflation, unworthy of concern for the better part of the nine-year-old bull market, is now a worry.”
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.”