(updated 11/13/20) “Skill follows the rules, talent breaks the rules, mastery shatters the rules, but genius makes its own rules.” ― Matshona Dhliwayo I have been holding off on publishing this post because I wasn’t sure how the US Presidential election might affect the theory and process behind my primary model, “Risk On or Risk Off” or … More Trends, Rates and Rotation.
Given the pace of recovery in asset prices, without a proportional recovery in economic activity, it is necessary to understand the drivers before erring on the side of caution. If you remember, the Feb-March swoon was a liquidation of all asset classes. Investors and institutions raised cash given the existential threat posed by the pandemic-induced … More Keeping It Simple
The most important guide in trading and asset allocation is Price, Price & more Price. Of course, one has to have enough sense to sniff out the BS contained in daily MSM and focus on the data points or narratives that are reasonable for asset allocation. Surprises such as the two suffered this week can … More Gold and Risk Off
This week, I was contacted by a journalist requesting my comments regarding a response to the following tweet by @tracyalloway, the managing editor at Bloomberg Markets: My response was the following: The reporter sought me out to understand the purpose of my comment. The question of whether or not I was responsible for the post … More Ethereum Bubble
Model remains in TLT and “Risk Off” for the 5th week in a row. Needless to say, the past two weeks have been difficult, pulling models down from +17.46% & +17.36% to +13.04% & +13.11% YTD. They are still beating the S&P 500 handily (+8.32%), but now trailing the Nasdaq (+14.3%) and Nasdaq 100 (+16.3%). … More Absolute Return Model – 7/9/17
This was the question posed by Jesse Livermore (@Jesse_Livermore, philosophicaleconomics.com) in a poll he posted on @Twitter last night. At the time of this writing, 15% of respondents thought it could still occur this year, 34% believe it will occur next year, 26% believe it will happen in 2019 and a quarter of respondents think it will begin … More When will the next US recession occur?
Since beginning the Absolute Return Strategy, every year has posed a number of risks to the viability of the model. The main risk is the possible correlation of different asset classes within a single market, since the assets I am using for this model are the QQQ and TLT exchange traded funds, which focus on the … More Ignoring the Noise
A goal of any wise strategist is to pick assets that won’t under-perform for the foreseeable future. Interesting choice of words, don’t you think? In the search for assets to add to a portfolio, one finds that in a highly correlated world, it is best to identify the possible laggards and discard them from the pool … More 2016 Model Strategy Review
This post is focused on my country of Panama. Much has happened since my last post in September. In October I was asked to help with certain aspects of the organization and logistics of two important global conferences being held in Panama, the World Social Security Forum (November 14-18) and the International Anti-Corruption Conference (December … More Sowing Seeds of Populism in Panama
If you have yet to read the post, you can find it here. Towards the end of the post you will find the following paragraph: In summary, financing costs, as represented by the rate imposed by the US central bank, rates used in bank lending and the rate acceptable to debtors, should remain relatively low. … More Looking back at “Trend of Interest Rates”, posted on May 26, 2016