Same Player – Different Question

The stock market turned in a terrific first quarter of 2024, rising 10.5% as measured by the S&P 500. It didn’t make much difference which sectors you were invested in as most returned close to the S&P.  The only laggards were utilities (+3%), defense (+4%) and real estate (-1%), none of which are in our portfolios. What ... Continue Reading

Recession Cries Subside

Those of you keeping track at home may recall that while over 75 percent of economists were predicting a recession in 2022 and 2023, I was not. What did I get right that they didn’t? First, I surmised that many of the factors leading to higher inflation were transient.  Second, I never saw a collapse in consumer spending. Instead ... Continue Reading

The One Thing That Matters

It was looking like the third quarter was going to be modestly profitable.  Then interest rates started rising.   The yield on 10-year Treasurys, which had been bouncing between 3.5% and 4% for most of the last year, rose from 4% to 4.8% from the end of July to early October. As interest rates rose, a 3% gain for the S&P 500 early ... Continue Reading

Is the Sky Still Falling?

For about the past year and a half, much of the investing and economic worlds have been expecting a recession (generally defined as two successive quarters of falling GDP). Interest rates had been rising at the beginning of 2022 when Russia invaded Ukraine. The invasion further stoked inflation fears, which were already inflamed by ... Continue Reading

Will Congress Never Learn?

(And a brief history of bank regulations) The first quarter of 2023 started on a very positive note.  The market was strong, with the S&P 500 up 8.8% through February 2.  It seemed we might avoid a recession. Then something unexpected happened. Mid-sized banks started to fail.  The market then did what it does best when ... Continue Reading

Let’s Hope This Time Won’t be Different

Who doesn’t like being right?  I know I do (just ask my wife!). In the third quarter 2022 Tempo Vantage, I wrote: ”While I expect short-term volatility to continue, and there certainly could be lower lows, with the markets already down between 25% and 30%, my guess is the worst of the decline may already be behind us.” That seems to ... Continue Reading

Too Much or Not Enough? That is the Fed Question.

The third quarter was a tale of two halves.  From July 1 to August 16, the S&P 500 rose over 13%.  Then, from August 17 to September 30 it fell over 16%. The result was a loss for the quarter of 5% for the S&P 500.  And there was no place to hide.  International stocks were down 10% and intermediate-term bonds were down close ... Continue Reading

Straw Off an Inflation Camel’s Back?

As a Vantage reader, you may know that I have been expecting inflation to pick up for a long time and have been positioning portfolios with this in mind. For years I wondered why inflation was so tame given the plethora of inflationary pressures which included foreign tariffs, reductions in immigration, low unemployment, supply chain ... Continue Reading

Let History Be Our Guide

The market is all about expectations and rarely moves due to things already on our near-term radar. Exogenous events, or things we don’t expect, are more often the culprit, especially for significant declines. That was certainly the case when Russia invaded Ukraine in the first quarter of 2022. Although there were some concerns ... Continue Reading

Reports of the Death of the Economy are Greatly Exaggerated

The fourth quarter of 2021 and 2021 as a whole were good times to be a stock investor. The broad market, as measured by the S&P 500, gained 11% for the quarter and more than 28% for the year. Like most of the last decade, the S&P 500 was among the best performing asset classes.  Compare its returns to some other important ... Continue Reading

Gratification Delayed

What had been shaping up as a modestly positive quarter wound up being little changed to slightly down. Although the S&P 500 eked out a small gain (+.58%), most equity segments ended the quarter in the red.  The Dow was down 1.5%, international stocks were down 1%, healthcare stocks were down 2% and technology stocks were down ... Continue Reading

Pent-Up Demand Will Give the Market a Hand

The second quarter of 2021 continued the strong uptrend in stocks that began when the market bottomed in the first stages of the pandemic. For the second quarter the S&P 500 was up 8.5%, small caps were up 4.3%, and international stocks were up 5%.  While there were a few outliers (utilities +1%, energy +13%, and real estate +11%), ... Continue Reading

Weight of the Evidence

The first quarter of 2021 was certainly an interesting time to be an investor.  After a steady start to the year, everything changed in mid-February. Perhaps it was the prospects for the end of the pandemic, the potential of Biden’s economic plans, rising interest rates or something else entirely.  What we do know is that in ... Continue Reading

Accelerating Trends

If you were only looking at the stock market, you would have no idea that we are still in the midst of a pandemic that has thrown millions of people into unemployment and has caused tens of thousands of businesses to close. The stock market gained 12% in the fourth quarter, as measured by the S&P 500 (large cap stocks).  Small cap ... Continue Reading

Of Presidents and Pandemics

The third quarter of 2020 was a great time to be an investor, with returns for most equity categories between 5% (small caps) and 11% (NASDAQ).  Let the good times roll.  Right? Not so fast.  Recall that the market had fallen precipitously in the first quarter in reaction to the pandemic. At the time I thought the decline was ... Continue Reading

A New New Deal?

All those who thought the market would return 20% in the second quarter please stand up and take a bow. What?  No one is standing?  Not even me! Yet that is exactly what happened and why I always caution against letting short-term events and emotions guide long-term investment decisions. For the quarter, the S&P 500 gained ... Continue Reading

COVID-19 and Coin Tosses

As I watch TV at night and see people behaving normally, I long for the days when I could roam freely outside, shake peoples’ hands, and not worry about touching metal surfaces. How quickly our lives have changed! I’ve written in the past how unforeseen, exogenous events can throw the markets into short-term turmoil.  The COVID-19 ... Continue Reading

A Contrarian View

What a difference a year makes!  This time last year we had just experienced a significant stock market decline and I was describing reasons why I was feeling optimistic (click here for last year’s 4Q Tempo Vantage). Today we are coming off a terrific year for the stock market and I will describe why I am feeling a bit ... Continue Reading

Deflating Inflation

October 2019 While the overall trend in the stock market continued up in the third quarter, the rate of increase has been slowing.  The S&P 500 was up 1.7% in the third quarter compared to gains in the first and second quarters of 13.6% and 4%, respectively.  Still, a gain is a gain! Beyond the S&P 500, though, returns ... Continue Reading

Lower for Longer

July 2019 For the better part of the last seven years many other market observers and I have been expecting higher interest rates.  That was the normal expectation as we recovered from the 2008 financial crisis. Indeed after bottoming at a yield of about 1.5% (yield on 10-year government bonds) in mid 2012 rates did rise to ... Continue Reading

It’s All Anyone Can Talk About

April 2019 I'm talking, of course, about the inverted yield curve.  You didn't think I was going to say the Mueller report, did you? An inverted yield curve is when the yield on short-term bonds is higher than the yield on longer term bonds.  On March 20, 2019 the yield on 1-year T-Bills (2.47%) was greater than the yield on 10-year ... Continue Reading

Pot Hole or Sink Hole?

January 2019 The way the markets were falling in the fourth quarter of 2018 you would think we are headed for the next Great Depression, or at least the next Great Recession.  We are not. For the quarter large cap U.S. equities (S&P 500) were down 13.5% and international stocks lost 12.5%.  And these were among the better sectors!  ... Continue Reading

Bull Markets and Market Bull

October 2018 After a modestly positive and volatile first half of 2018 the market had a fairly profitable third quarter.  Leading the way were large cap U.S. Equities (i.e. S&P 500) which returned over 7.5%.  Most other sectors had good quarters, though not as good as large cap U.S. equities.  Small cap stocks made just over 3%, ... Continue Reading

Trade is Not a Zero Sum Game, Mr. President

July 2018 Right now I see two dominant forces affecting the markets which are also likely to exert influence as we move forward. The first is interest rates, which have been rising.  Rising rates are generally bad for both stocks and bonds.  But, as I have written in the past, more important than the fact that rates are rising is ... Continue Reading

Economics 101 For Presidents

April 2018 The upward trending, low volatility stock market that had been in place for nearly two years continued as we began 2018.  Through January 26th the S&P 500 was up 7.5%.  Then the trend abruptly changed. Over the next nine trading days the market dropped just over 10%, marking the first correction (defined as a drop of ... Continue Reading

The 800 Pound Gorilla

January 2018 An 800 pound gorilla is dominant because of its great size and power.  In the latter part of 2017 the stock market had its own version of an 800 pound gorilla:  the tax overhaul.  As the fourth quarter progressed it seemed that the only thing that mattered was if the Republicans would be able to pass a tax bill. Clearly ... Continue Reading

3 Things You Can Do For Your Adult Children That Won’t Annoy Them

When my wife and I saw our son off to college last year it was with a mix of emotions. We were bursting with pride. We also realized that our little boy was growing up and would no longer rely on us as he had in the past. Two months into his first semester he called us from campus telling us he wasn't feeling well and could not hear ... Continue Reading


October 2017 Low volatility continues to be the overarching theme of the markets in 2017, despite our domestic politics and global turmoil. Through it all the markets are having a pretty good year. For the third quarter the S&P 500 was up 4.5%, which brings the year-to-date return to +14.2%. Beyond the S&P 500 most market ... Continue Reading

Protecting Your Identity in the Wake of the Equifax Breach

As you are no doubt aware, Equifax, one of the three major credit reporting agencies, had a massive security breach affecting up to 143 million people. Data that has potentially been exposed includes social security numbers, dates of birth, addresses, drivers license numbers, and credit card numbers. Before I go on note that this is an ... Continue Reading

The New Gridlock

July 2017 There is quite a contrast these days between the volatility in the social/political world and the relative calm of the stock market. Pick a region of the world and you will find instability: • In the U.S. we have a President embroiled in controversy and Republicans and Democrats who can't agree the sky is blue. • ... Continue Reading