2018: A Tough Row To Hoe

For most investors, 2018 is turning out to be a tough row to hoe. Suddenly, nobody is talking about global synchronized growth, low inflation, the benefits of tax cuts, and 20% earnings growth. No, all that is now so 2017. Now investors are focused on slowing global growth, rising rates, an overzealous Fed, a global trade war, plunging oil prices, a rising dollar, risk in the corporate credit markets, and de-FAANGing their portfolios.

However, all this negativity is a rather recent development. Recall that until the beginning of October, the 2018 investing game had been pretty simple. Buy U.S. stocks and focus on those popular momentum-oriented names. Easy peasy, right?

But as is often the case, just about the time everybody had figured out the game, everything changed.

So here we are; staring at just 25 trading days left in the year. The bottom line on this fine Monday morning is that most investors are focusing on the negative and fearing the worst. Gone is the hope that ongoing earnings growth will produce strong stock market returns for as far as the eye could see. In its place is the idea of "correcting" prices for the new normal. A "normal" that includes the word "slowing" in front of just about every bullet point in the market narrative.

A Lot Of Red Out There

In looking at the year-to-date returns of the various asset classes through Friday, the appropriate theme song for the year would be, Nowhere to Run. Take a look at the numbers below and you'll see what I mean.


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Man, that's a lot of red.

In fact, Ned Davis Research tells us that this could be the first year since 1972 that none of the top eight asset classes (U.S. Large ...

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Near Term - It's All About The Headlines. Longer-Term - It's About...

A busy few days of entertaining family in Colorado provided a reprieve from the keyboard and the markets over the weekend. Thus, I'm going to let the indicators do most of the talking to start this holiday-shortened week.

Briefly ...

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The NEW Daily Decision for 11.19.18 - Near-Term: It's All About The Headlines. Longer-Term: It's About...


The State of the Markets:

A busy few days of entertaining family in Colorado provided a reprieve from the keyboard and the markets over the weekend. Thus, I'm going to let the indicators do most of the talking to ...

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The Straws Breaking The Market's Back

Monday was another volatile day on Wall Street as the Dow Jones Industrial Average plunged 602 points. Granted, problems at Apple (AAPL) and Goldman Sachs (GS) accounted for 170 of those points. And yes, the machines were clearly at work ...

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Understanding the Current Earnings Game

When stocks enter a corrective phase, the main question investors tend to ask themselves is, has anything changed from a macro point of view?

One of the problems with trying to answer this question is that corrections generally are born ...

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The NEW Daily Decision for 11.12.18 - Understanding the Current Earnings Game


The State of the Markets:

When stocks enter a corrective phase, the main question investors tend to ask themselves is, has anything changed from a macro point of view?

One of the problems with trying to answer this question is ...

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The NEW Daily Decision for 11.9.18 - Portfolio Update


Today's Portfolio Review

Despite the recent "bounce," we continue to maintain a modestly defensive position (net long exposure currently stands at 89% and each of the strategies holds some cash) at this time. The reason is simple. Historically, when ...

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The NEW Daily Decision for 11.5.18 - Garden-Variety So Far, But...


The State of the Markets:

I've got an early meeting (who's idea was it to schedule a board meeting for 7:00am on a Monday??) and I am traveling the rest of the week, so I'm up ...

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The NEW Daily Decision for 11.2.18 - Of Jobs, Apple, and Trade


Portfolio Strategy Update:

As long-time members know, we don't spend a lot of time (almost none, actually) touting our views on the market or making "calls" about what to expect next. In our more than 40-years of combined market ...

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The NEW Daily Decision for 10.30.18 - Two Ways To Improve The Mood


The State of the Markets:

There can be no denying that we've got a nasty market on our hands. A market where the venerable Dow Jones Industrial Average can be up 300 points one moment and down 600 the ...

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The NEW Daily Decision for 10.29.18 - How Low Can It Go?


The State of the Markets:

Are we having fun yet? To be sure, the recent stock market correction has created some angst as the bears have knocked -7.55% off the DJIA, -9.63% off the S&P 500, -12.60 ...

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The NEW Daily Decision for 10.22.18 - Sifting Through The Conflicting Evidence


The State of the Markets:

From my seat, the most important question on this fine Monday morning is if stocks are currently in the "retest" stage of a waterfall decline, which means that we are likely closer to the end ...

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