Regional bank stocks have been hit hardest by the flattening of the yield curve lately. As a result of traders fear that bank earnings may fall, the KBW Regional Bank Index has underperformed the S&P 500 by more than 18% so far this year.

At what seems like the worst possible time to invest in small banks, why look now?

Here’s were I think there is some value, and one bank in particular that is set up to weather the storm:

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Big news this week as the U.S. yield curve has been flattening rapidly. Why should you care?

Here Bloomberg takes a look at the spread (or difference in interest rates) between 3 month treasury bills and 10 year treasury notes. Notice how inverted spreads (where short term treasuries yield more than long term treasuries) have often been a sign of an imminent recession:

Chart from Bloomberg article found here

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A high dividend yield can be a sign of a strong, stable company and investment.  However a large dividend yield may also be a signal of trouble and a hint that the company’s dividend may be unsustainable and cut in the near future.

 

Thankfully for investors, there are several quick checks you can do based on a company’s financial statements to see how sustainable that dividend really is. [click to continue…]

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9 Signs of a Competitive Advantage (#9 is One of Buffett’s Favorites to Look For!) thumbnail

Finding a company with a competitive advantage means finding an investment that will offer solid returns for decades to come. What identifies a company with a strong competitive advantage? Some results may surprise you. [click to continue…]

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Another busy week of earnings. Here are a few quotes that stood out to me during this week’s conference calls – major topic; rising prices and costs just about everywhere: [click to continue…]

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The announcements today of charges against former Trump campaign chairman Paul Manafort have woken up markets this morning. The charges are not against anyone currently in the government, and no charges seem directly related to the investigation into Russia’s interference with U.S. elections or collusion with Russian officials.  But, where there is smoke there is fire, and this announcement has a lot of people wondering what else remains to be discovered.

It is not an direct comparison, but let’s say this gets as bad as Watergate and cover ups exist all the way up the ladder at the White House, what can investors expect to happen? [click to continue…]

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Why invest in commodities? And why now?

If you are questioning why commodities would make a good investment, you are not alone. Here’s what Warren Buffett had to say about one of the most famous commodities, gold: [click to continue…]

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The week starts off with an ominous article in the Wall Street Journal. Margin debt, or loans investors have taken out with their investments as collateral has hit an all time high. Higher than just before the 2000 bursting of the tech bubble, higher than just before the 2007 financial crisis.

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I really enjoyed the latest Talks at Google, featuring Andrew Lo. His presentation gives some great examples, and warnings, to investors:
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This week’s Chart of the Week comes from the most recent ‘Guide to the Markets’ put out by the wealth management folks at JP Morgan:

emerging_markets_vs_S&P_500How much longer can the trend last? Here’s some thoughts: [click to continue…]

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Investors have to interpret a lot of numbers, and make sense of a lot of forecasts in order to come to well educated investment decisions. But many of us went through the math class that taught us how to do this asking the teacher, “When are we ever going to use this?” and spacing out.

Jordan Ellenberg does an excellent job giving you a crash course in some basic math principles that have great benefits for investing.

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Pioneer Natural Resources (Ticker: PXD) shocked oil investors when it released their second quarter earnings last week. Shares of the shale driller went from $163 a share to under $130,and other s hale oil names fell as much as 10%.

The company reported $233 million in net income, a 4% rise in production and lower operating costs. So why did Wall Street sell off the sector? They saw this graph:

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What are CEOs saying to their shareholders as the first half of 2017 is in the books? Here are some excerpts from industry leaders like 3M, Facebook, Boeing and more.

 

Some common themes this week: [click to continue…]

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What does it take to reach a retirement account of $1 million? Here we take a look at how much you would have to save each month, depending on your age, to reach the $1 million milestone. [click to continue…]

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This week marks the anniversary of, at the time, the largest bankruptcy in American history and the conclusion of the largest case of accounting fraud in history. *

WorldCom declared bankruptcy July 21st, 2002 with $107 billion in assets.

How did this fraud develop? How was the WorldCom scandal discovered? How did WorldCom investors fare? [click to continue…]

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I don’t think there is any better teacher than history. So when you can get one of the classics for less than $3 used on Amazon, I don’t hesitate.

‘Bull! A History of the Boom and Bust’  by Maggie Mahar covers the beginning of the bull market in 1982 through the tech bubble bust and beginning of the recovery through 2004… [click to continue…]

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Over time, the largest share of the expenses you pay while investing will be a result of paying ETF or mutual fund expense ratio fees.

How do you find out how much your funds are charging you? How much will those fees affect your savings over the course of your investing life? We take a look… [click to continue…]

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Emerging market stocks have had a rough decade. 3 year annual returns are flat and even long term 10 year annual returns are barely over 1.5%. But there is new life appearing in the emerging markets. This year the FTSE Emerging Market Index is up 18%, breaking a long term downtrend:

Emerging Market ETFs

Are emerging markets turning the corner?

What’s the best way to invest in emerging markets? We take a look at a few options:

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Here are some stories that caught my eye this week: [click to continue…]

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This Week in Earnings Transcripts

 We are in the middle of earnings season. What are corporate executives seeing in the world economy? Take a look:

 

Lots of bullish words on Europe:

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