March 4, 2016 By Steve Blumenthal “The best state pension plan is only 42% funded.” I was in Florida this week attending the 32nd Annual Chicago Board of Options Exchange (CBOE) Risk Management Conference.  Attendees were mostly asset managers and larger pension and endowment managers.  Several [...]Read More >

February 26, 2016 By Steve Blumenthal “Time to put 25% to 30% of your wealth in cash.” – Mohammed El-Erian "If you go to an investment adviser, they'll tell you cash is wasted," says El-Erian, chief economic adviser at Allianz.  ‘I don't think so.’  ‘You will have many opportunities to buy [...]Read More >

February 19, 2016 By Steve Blumenthal “If zero or negative interest rates actually fixed what's broken in the economy, we'd all be living in Paradise after seven years of zero interest rates.” - Charles Hugh Smith (blog) I am up early, in my favorite chair and loving the coffee that Susan just [...]Read More >

February 12, 2016 By Steve Blumenthal “Goldman Sachs Abandons Five of Six ‘Top Trade’ Calls for 2016” February 9, 2016 Bloomberg News From Financial Advisor Magazine: “The dollar versus a basket of euro and yen; yields on Italian bonds versus their German counterparts; U.S. inflation [...]Read More >

February 5, 2016 By Steve Blumenthal “Clearly, QE has not worked. We have not had one year of 3%+ growth since the Great Recession and are barely averaging 2%.  Yes, if your measure is the stock market and other financial assets that have inflated, then QE has worked quite well.  But the boost QE [...]Read More >

January 29, 2016 By Steve Blumenthal “Greenspan, Bernanke and Yellen – who are more like teenagers at a prom night. They are spiking the punch bowl and handing out free drinks and hoping to get lucky at the end of the night.” James Montier, GMO “Understanding the forces of Supply and Demand in [...]Read More >

By Steve Blumenthal January 22, 2016 "Since the only way you are going to find solutions to painful problems is by thinking deeply about them - i.e., reflecting - if you can develop a knee-jerk reaction to pain that is to reflect rather than to fight or flee, it will lead to your rapid [...]Read More >

January 15, 2016 By Steve Blumenthal The speed at which stocks have dropped 10% (defined as a correction) two times in a short period of time has happened just three times in the last 100 years.  1927, 2000 and 2008. This from Art Cashin yesterday, “Jason Goepfert, the outstanding pilot of [...]Read More >

January 8, 2016 By Steve Blumenthal China marked its currency lower once again yesterday.  That makes eight days in a row they lowered the yuan.  Last August, they devalued the yuan and that sent global equity markets into a dive.  As Yogi Berra would say, “It’s déjà vu all over again.” For [...]Read More >

December 31, 2015 By Steve Blumenthal Where do we stand now, economically? “Well, we are right back at it: trying to stimulate growth through easy money. It hasn’t worked, but it’s the only tool the Fed’s got. Meanwhile, the Fed’s policies widen the wealth gap, which feeds political extremism, [...]Read More >

December 18, 2015 By Steve Blumenthal “There is a doctrine in finance called the dividend discount model. It says that the price of a common stock is the present value of its future cash flows discounted by a suitable rate of interest. Now what would happen to the calculation of the value of that [...]Read More >

December 11, 2015 By Steve Blumenthal “You are driving forward and the road you are on ends.  You have come to what the British call a T-Junction.  You can transition to one of two alternatives.  But you cannot stay on the road you are on. One alternative is good.  It is a hand off from central [...]Read More >

December 4, 2015 By Steve Blumenthal “The economy is like a machine.  At the most fundamental level it is a relatively simple machine.  But many people don’t understand it – or they don’t agree on how it works – and this has led to a lot of needless economic suffering... Seeing the economy and [...]Read More >

November 20, 2015 By Steve Blumenthal “I have long made the claim that the transnational nature of Europe cannot be sustained. The divergent economic interests of EU countries, some with unemployment over 20 percent, some with it under 5 percent, meant that it was impossible for all of them to [...]Read More >

November 13, 2015 By Steve Blumenthal “The European Central Bank is likely to continue negative rates, extend and enlarge QE, and acquire more balance sheet assets over time. ECB policy influences other nearby non-euro jurisdictions. Essentially, all short-term interest rates of [...]Read More >