January 11, 2011 - Vol 5 Issue 2
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A Bold Forecast for Consumer Spending
By Robert Huebscher
In a world where mainstream media has become overly fond of alliterative headlines, 'frugality fatigue' has emerged to characterize the view that consumers have loosened their belts and begun to spend some money. That's far from the consensus view. However, if it proves to be correct, as one prominent retail analyst claims, it would be the clearest indication that the economy is recovering strongly.
Tactical Asset Allocation and Market Timing: What's the Difference?
By Nancy Opiela
Why is it that the industry dismisses significant changes to portfolio allocations as "market timing" transactions but embraces the subtler "tactical shifts" many advisors are making in the current, transitional market? As advisors debate the nuances of that question, the more relevant question may be: How would you respond if a client asked you to explain the difference between market timing and tactical asset allocation?
Structuring 2011 Meetings for Maximum Effectiveness
By Dan Richards
Last summer, I wrote about new research on the factors that shape how consumers recall interactions and experiences. What was found was that in every experience, two things play the most important role in what people remember - that's true whether it is a restaurant meal, a vacation or a meeting with an advisor.
What's Past is Prologue
By Michael Nairne
With nearly two centuries of stock market performance history now available, investors should be well-armed intellectually to deal with the vicissitudes of equity investing. Many, however, are not. I explore this history and what it means for future performance.
The Two Elephants Facing the US Economy
By Michael Lewitt
The consensus has reached the conclusion that financial markets will enjoy a strong start to 2011. This is reason enough to approach the markets with caution as the year begins. When everybody is leaning to one side of the boat, the vessel is far more likely to tip over, particularly if it hits an unexpected wave.
The Key to Scaling Your Practice
By Bob Oros
Independent advisors who are ill-equipped to handle a large influx of business from retiring baby boomers will struggle to harness the swelling demand. To capitalize on this new wave of assets, advisors need an edge. Many forward-thinking advisors have already discovered such an advantage in model portfolios.
Managing People Who Are Already Motivated
By Justin Locke
As a professional speaker, I am often confused by audiences who want to understand the secret to motivating their employees. Most professionals, including financial advisors, aren't constrained by workers who lack motivation. Their challenge is harnessing their employees' pre-existing energy and drive, and directing it toward a common goal.
2010: A Truth Odyssey
By Ron Surz
I review some of the lessons learned in the last two years. I review the last year, discuss 2008's lessons, and conclude with my traditional review of the longer-term history of U.S. markets over the past 85 years.
Letter to the Editor
A reader responds to the article, Return Distributions and the Shiller P/E Ratio, by Keith Goddard, which originally appeared on February 2, 2010 and was contained in The Ten Best Articles You Probably Missed on December 28.
Highlights from Market Commentaries
Below are the three most widely read commentaries during the last week:
Off With Our Heads!
American politicians and citizens alike have no clear vision of the costs of a seemingly perpetual trillion-dollar annual deficit. Meanwhile, policy stimulus is focused on maintaining current consumption as opposed to making the United States more competitive in the global marketplace. Dollar depreciation will sap the purchasing power of U.S. consumers, as well as the global valuation of dollar denominated assets.
Tags: Employment Inflation Fiscal Policy
Off With Our Heads! by Bill Gross of PIMCO
What The Bulls May Be Ignoring ... At Their Peril ... Plus Some Ideas For 2011
The bullish case is pretty well established right now and there is no sense repeating them but what may be ignored are these half-dozen. Nothing of course says that the market can't keep going up over the near-term. risks, I list. Just as the onus was on the double-dippers last summer given the sentiment and market action, the onus now is clearly on the V-shaped enthusiasts.
Tags: Neutral Oil US China Monetary Policy Fiscal Policy
What The Bulls May Be Ignoring ... At Their Peril ... Plus Some Ideas For 2011 by David A. Rosenberg of Gluskin Sheff
Setup and Resolution
One of the striking features of the market here is the extent to which large-cap, high-quality has underperformed speculative sectors of the market, creating what we view as a multi-year "setup" in favor of high quality issues.
Tags: Equities US
Setup and Resolution by John P. Hussman of Hussman Funds