tag:blogger.com,1999:blog-71696015866756666732024-03-21T07:58:00.878-04:00View From the BridgeUnknownnoreply@blogger.comBlogger59125tag:blogger.com,1999:blog-7169601586675666673.post-69229643802198662742014-09-25T11:45:00.000-04:002014-10-01T07:42:53.709-04:00The Truth About US Equity Valuations
Co-authored by Ron Granberg, CFA, ClearWater Capital Management
It
has been said that there are multiple stages leading to the acceptance of a
great truth. It may initially be dismissed as absurd, then violently opposed,
and finally accepted as though it were never in doubt. Warnings of investment
bubbles follow a similar pattern. Because valuations correlate poorly with
returns Unknownnoreply@blogger.comtag:blogger.com,1999:blog-7169601586675666673.post-57731682399412112002014-08-27T08:56:00.000-04:002014-08-27T08:56:52.604-04:00US Housing Starts: Better? Yes. Good? No.
The initial estimate of July housing starts
exceeded expectations as construction began on 1.093 million dwellings on a
seasonally-adjusted, annualized basis. Additionally, June starts were revised
higher from 893,000 to 945,000. While improvement is welcome, perspective is
necessary. Despite dramatic improvement from the all-time lows reached in 2009,
housing starts remain moribund when Unknownnoreply@blogger.comtag:blogger.com,1999:blog-7169601586675666673.post-29641933258570608042014-07-31T14:05:00.000-04:002014-08-21T14:05:48.080-04:00Initial 2nd Quarter GDP Report Surpasses Expectations
The Bureau of Economic Analysis (BEA)
released its first estimate of 2nd quarter GDP this week, indicating that the
US economy grew at a seasonally-adjusted, annualized rate of 4%; well above the
median forecast of 3% among 80 economists surveyed by Bloomberg and our own
expectations. The bulk of the growth came from personal consumption
expenditures, which contributed 1.69 percentage points, Unknownnoreply@blogger.comtag:blogger.com,1999:blog-7169601586675666673.post-12647589949513288032014-07-28T14:42:00.004-04:002014-07-28T16:46:37.841-04:00US Economy Fails to Gather Momentum Despite Fed Largesse
The
International Monetary Fund (IMF) recently cut its forecast for 2014 US GDP
growth, from 2% to 1.7%, while maintaining its 3% estimate for 2015. If the
IMF’s 2014 forecast proves accurate, it will be the second consecutive year of
weaker growth after the US economy expanded at a rate of 2.8% in 2012 and 1.9%
in 2013. Since the Fed began its most recent round of quantitative easing, or
QE, Unknownnoreply@blogger.comtag:blogger.com,1999:blog-7169601586675666673.post-36630293039804065072014-07-10T08:18:00.001-04:002014-07-10T08:18:07.027-04:00First Quarter GDP: The Don Nix of Economics
Does the name Don Nix ring a bell? Maybe
not, but the composer, arranger, and musician wrote one of the most often
covered blues/rock songs of all-time. Nix’s simple, yet catchy, “Going Down,”
was first popularized by blues legend Freddie King in 1969 and has since been
covered by a “Who’s Who” of guitar heroes from Jeff Beck-to-Warren
Haynes-to-Joe Satriani. The song’s driving bass line and Unknownnoreply@blogger.comtag:blogger.com,1999:blog-7169601586675666673.post-63820951428949954142014-05-30T15:24:00.002-04:002014-08-21T14:06:01.066-04:00Europe Mandates Inclusion of Illegal Activities in GDP Calculations
It has often been said that truth is stranger than fiction and so it is with European GDP calculations. In an attempt to standardize GDP calculations across EU member nations, which is logical, Europe is absurdly mandating that countries include illegal activity in their GDP calculations. Despite decades of closer social and economic ties, there remains diversity in laws across European UnionUnknownnoreply@blogger.comtag:blogger.com,1999:blog-7169601586675666673.post-31529341044655682032014-05-08T12:09:00.001-04:002014-05-08T12:09:41.729-04:00PRESS RELEASE: BWCM Announces New Tactical Strategies
SYRACUSE, NY - Blue Water Capital Management, LLC, an SEC
registered investment advisor providing discretionary asset management services
to individuals and institutions, and Ferrell Capital Management, LLC (FCM), a
premier provider of risk management solutions, have signed a definitive
agreement to bring innovative tactical risk managed investment strategies to
market.
Blue Water Unknownnoreply@blogger.comtag:blogger.com,1999:blog-7169601586675666673.post-54144400066961986462014-04-29T10:40:00.001-04:002014-04-29T10:41:23.199-04:00Is The Recovery in Housing Losing Steam?
While many have been quick to
blame a relatively severe winter for economic weakness in the first quarter, it
would appear that weather had little to do with weaker growth in the US housing
market. Mortgage purchase applications have been in a downward trend since last
spring and through the week ending April 18,, 2014 they were down
18% year-over-year. Initially, declining mortgage purchase Unknownnoreply@blogger.comtag:blogger.com,1999:blog-7169601586675666673.post-32654159819932251592014-02-12T14:55:00.001-05:002014-02-12T14:55:45.344-05:00Eurozone Debt Update
The debt and deficit challenges that
drove the Eurozone to the brink in 2011 have largely faded from the news since
the restructuring of Greek debt in March 2012. However, we have continued to
monitor debt/GDP levels in the Eurozone, and specifically in the periphery
nations. In August 2012, the European Central Bank’s announced its OMT, or "Outright Monetary Transactions" program, a program Unknownnoreply@blogger.comtag:blogger.com,1999:blog-7169601586675666673.post-72176973410816086842013-10-04T10:15:00.002-04:002013-10-04T10:48:13.300-04:00A Guide to the US Federal Government “Shutdown”
A “shutdown” of the federal government began at midnight on October 1st. We placed the word shutdown in quotations because the government hasn’t truly shutdown. Rather, it has suspended all “non-essential” services and furloughed employees associated with those services. As a result, about 800,000 of the approximately 3.3 million federal employees, or just about 25%, have been furloughed. What Unknownnoreply@blogger.comtag:blogger.com,1999:blog-7169601586675666673.post-90917118601387347662013-09-18T13:09:00.000-04:002013-09-18T14:26:50.291-04:00Barron’s Article Indicates Stocks and Bonds at High Level of Historical Valuation
Two weeks ago Barron’s published an
interview with Cliff Asness, one of the founders of AQR Capital Management and
the former director of Quantitative Research at Goldman Sachs. Barron’s asked Mr.
Asness what kind of return investors could expect from a traditional 60/40
stock/bond portfolio. While noting that his answer referred to US stocks and
bonds, he stated that the answer is not that Unknownnoreply@blogger.comtag:blogger.com,1999:blog-7169601586675666673.post-5339944639335563802013-09-10T20:25:00.001-04:002013-09-12T21:12:54.175-04:00Why We Like Emerging Markets Bonds
When we initiated positions in
emerging sovereign bond markets in late 2008, we were relatively early in
embracing the asset class as a core holding within portfolios. At the time,
many investors saw emerging markets debt, or EMD, as a niche asset class. Yet
our research indicated that it had changed dramatically over the previous
decade. More emerging countries were allowing their currencies Unknownnoreply@blogger.comtag:blogger.com,1999:blog-7169601586675666673.post-53922932483662021722013-08-23T09:24:00.000-04:002013-08-23T11:09:26.013-04:00How High are Yields Likely to Rise?
How high are bond yields
likely to rise? That question has been on the mind of investors since rates
began to rise in earnest with Ben Bernanke’s comments in front of Congress in
late May. After starting the year at just over 1.75%, the yield on the US
10-year Treasury bond rose to just more than 2.05% in March before declining through
early May, reaching its low for the year at 1.63% on May Unknownnoreply@blogger.comtag:blogger.com,1999:blog-7169601586675666673.post-64317024594975590612013-08-12T13:29:00.001-04:002013-08-12T13:31:21.918-04:00The Myth of the Accelerating US Job Market
On
August 2nd, the Bureau of Labor Statistics released the July
employment report. The economy added 162,000 jobs, 13,000 fewer than expected
and the fewest since March. Revisions to May and June indicated that the
economy added 26,000 fewer jobs during those months than previously estimated.
Through the first seven months of the year, the US economy added an average of
192,000 jobs per monthUnknownnoreply@blogger.comtag:blogger.com,1999:blog-7169601586675666673.post-85126360089630651822013-08-06T15:16:00.000-04:002013-08-06T15:16:26.603-04:00US Equity Markets Over-Valued, Outlook Poor
We
have long voiced concerns about the risks to the US equity market. From the
market’s lows in March 2009, equity prices and earnings largely rebounded
together through 2011. However, earnings growth stalled in 2012 while stock
prices continued to climb. Moreover, while earnings growth remains modest,
prices have already risen more year-to-date than they did in all of 2012. Moreover,
using Unknownnoreply@blogger.comtag:blogger.com,1999:blog-7169601586675666673.post-74812943497382235242013-07-27T08:49:00.004-04:002013-07-27T12:16:43.866-04:00European Debt Crisis Far From Over!
Last July, ECB President Mario Draghi famously promised to do “whatever it takes to preserve the euro.” European stock and bond prices rallied on the news, which apparently caught even a number of Draghi’s cohorts on the ECB Governing Council off guard. However, in relatively short order, the ECB followed his proclamation with the announcement of the OMT, or Outright Monetary Purchase, Unknownnoreply@blogger.comtag:blogger.com,1999:blog-7169601586675666673.post-8042492138211674022013-06-27T07:21:00.002-04:002013-06-27T07:22:32.630-04:00US Equities Aside, Global Markets Have Struggled in 2013
Investors often pay the most
attention to the markets in the country in which they live. This is especially
true in the US, home to the largest and most liquid stock and bond markets in
the world. As a result, they often extrapolate the performance of domestic
markets to their entire portfolio. It is not unusual for them to become nervous
when US equities plunge, worried about an erosion of Unknownnoreply@blogger.comtag:blogger.com,1999:blog-7169601586675666673.post-69059286875883106302013-04-17T11:40:00.001-04:002013-04-17T11:49:24.801-04:00US Housing Recovery at a Glance
Preliminary estimates indicate
that US homebuilders began construction on a seasonally adjusted 1.036 million
homes at an annualized rate in March, the most since June 2008. While pundits
and prognosticators are likely to trumpet such numbers as an indication of a
strong housing recovery, as has so often been the case during this recovery,
the underlying data is weaker than the headline figure Unknownnoreply@blogger.comtag:blogger.com,1999:blog-7169601586675666673.post-20179530693085672082013-04-04T16:32:00.003-04:002013-04-05T07:39:08.279-04:00The Printing Press Won’t Save Japan
Johannes Guttenberg’s printing
press was instrumental in the cultural, intellectual, and economic changes that
transformed Europe from a medieval to a modern society. It played an integral
part in the Renaissance, the Protestant Reformation, and the rise of the Age of
Reason. Through the printing of newspapers, it helped educate the masses. It supported
the growth of science and democracy. In Unknownnoreply@blogger.comtag:blogger.com,1999:blog-7169601586675666673.post-22833528159327213092013-03-14T13:49:00.000-04:002013-03-14T13:51:26.228-04:00A Plan to Blow a Bubble
Below is a response from Fed
Chairman Ben Bernanke to a reporter’s question on QE (quantitative easing) and
the recovery. We have taken the quote directly as reported by The Economist.
“The tools we
have involve affecting financial asset prices, and ... those are the tools of
monetary policy. There are a number of different channels—mortgage rates, I
mentioned other interest ratesUnknownnoreply@blogger.comtag:blogger.com,1999:blog-7169601586675666673.post-60497705630678399472013-03-12T07:23:00.005-04:002013-03-13T08:29:32.537-04:00Is US Job Growth Accelerating?
The February employment report was
unambiguously positive. Sure, the labor force participation rate ticked down
0.10% to 63.5%, matching its lowest level in more than 30 years. But that is
not a significant divergence from its average of the last 12 months or so.
Additionally, at 58.6%, the employment-to-population ratio remained among the
lowest of the last 30 years. While low participation Unknownnoreply@blogger.comtag:blogger.com,1999:blog-7169601586675666673.post-74444334325937766182013-02-20T12:17:00.001-05:002013-02-21T08:48:40.720-05:00U.S. Earnings Insight
With approximately 87% of the
S&P 500 companies having reported 4th quarter 2012 earnings, it
has become clear that the 4th quarter will be the second consecutive
quarter in which operating earnings are lower than in the same quarter of the
prior year. While much has been made about the fact that the vast majority of
companies have beaten estimates, investors would do well to remember thanUnknownnoreply@blogger.comtag:blogger.com,1999:blog-7169601586675666673.post-20661854568057163142013-02-19T11:22:00.000-05:002013-02-21T07:36:41.490-05:00European Debt Conditions Continue to Worsen
While the actions of the European
Central Bank have eased the most immediate concerns about Europe’s debt crisis,
the crisis is in a state of hibernation rather than dead and buried. The
European Central Bank provided massive liquidity to the banking system,
offering unlimited loans to banks at its policy rate of 1% for up to three
years. It has also offered to buy unlimited amounts of sovereignUnknownnoreply@blogger.comtag:blogger.com,1999:blog-7169601586675666673.post-81164597578368138972013-01-25T10:20:00.001-05:002013-01-25T10:44:02.522-05:00Putting the US Housing Recovery into Perspective
Approximately two years ago, we began
suggesting that the US housing market was in the process of bottoming and 2012
seemed to be a year in which new home construction and home sales gathered
upward momentum. However, recently there seems to be near euphoria regarding
the “strength” of the housing market and its ability to contribute to economic
growth. We agree that housing is in the Unknownnoreply@blogger.comtag:blogger.com,1999:blog-7169601586675666673.post-79657977575314137252013-01-11T10:59:00.001-05:002013-01-11T15:07:30.050-05:00Blue Water's International Equity Portfolio Manager Named Morningstar's Manager of the Year
Rajiv Jain, portfolio manager of the Virtus Foreign Opportunities Fund
(symbol JVIAX/JVXIX)
has been named Morningstar's 2012 International-Stock Fund Manager of the Year
(U.S). This award recognizes portfolio managers who
demonstrate excellent investment skill and the courage to differ from the
consensus to benefit investors."
Blue Water has utilized the Fund to manage the Unknownnoreply@blogger.com