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November 24, 2008
Investors who are looking for an extended period of good news, or an extended market rally, continue to be disappointed; inching us ever closer to a final capitulation when selling becomes exhausted. The tendency of markets to fall too far/too fast in relation to fair value during times of panic (and to do the opposite during times of greed/euphoria) appears to be the order of the day.
November, 2008
Following is a timeline of action taken by governments and central banks of the US, UK and Europe to deal with the continuing credit crisis. This is not meant to be an exhaustive list of every action taken, but should include all significant steps taken through November 7, 2008.
November, 2008
The recent underperformance of SEI’s Core Fixed Income Funds has been of a magnitude that is beyond what would have been anticipated for a diversified fixed income portfolio. Yet, the managers that have struggled the most during this period are also among the most experienced and successful in this discipline. In SEI’s view, their strengths have not been diminished and we remain confident that the strategy is positioned to deliver excess returns, or alpha, in the years ahead.
November 10, 2008
While the markets did show us a little hope the past 2 weeks, it was in the extremely volatile, non-consistent manner that’s been par for the course over the past 12 months. The name of the game, in order to realize any semblance of recovery, is confidence. Confidence by banks to begin lending again on a larger scale; confidence by consumers to begin spending again; confidence by employers to hang onto current headcount and perhaps expand it; and confidence by investors, both private and institutional, to put capital back to work. Ultimately, all of these should fall into place; but the path will not be smooth, nor will it happen overnight.
October 27, 2008
Despite the fact that both candidates have made their positions clear (and it seems simple to infer which industries and companies might win or lose) there are other factors that render such analysis speculative at best. The markets never stop trading and may to a certain extent already be pricing in the victory of either candidate.
October 27, 2008
Following a breather in world markets two weeks ago, where major indices regained some lost ground, this past week marked a heightened return to uncertainty; much of which is being driven by continued panic selling. Major institutions, mutual funds, and hedge funds have been forced to unload equity positions in order to raise cash; increasing the supply of equity shares available in a market where buyers are still scarce. The end result is, of course, declining prices.
October 13, 2008
The wildcard is not if this panic will end, but rather when it will end. Just as investors can become overly optimistic during rising markets (such as 1987) or the height of the tech bubble, they can become overly pessimistic during falling markets. Suggestions that what we are currently experiencing is a prelude to the “next Great Depression” generally ignore the many differences between that period of our history and the current one.
September 29, 2008
The US Congress and Administration have agreed on a plan to purchase troubled mortgage-related securities, which is scheduled to be voted on today. This legislation would give the Treasury authority to purchase up to $700 billion of the most “toxic” mortgage-backed securities from suffering financial institutions (domestic institutions as well as foreign institutions doing business in the US). This action would remove these otherwise un-sellable assets from the balance sheets of these companies, providing much-needed cash for lending.
September, 2008
The US government’s decision to provide immediate funding and financial backing to the country’s two mortgage giants—Federal Home Loan Mortgage Corp. (Freddie Mac) and Federal National Mortgage Association (Fannie Mae)—has underpinned the debt of these companies and the MBS they underwrite.
September, 2008
With stories of financial mayhem dominating the news, investors’ minds are focused on the here and now (which doesn’t look very rosy) and thoughts of the long-term can easily get pushed to the background. “What next?” seems to be the question on every investor’s mind.
September, 2008
In the current environment, we continue to experience some of the greatest financial market volatility in the modern investing era. Events of the past couple of years—including the housing crisis, credit crisis, skyrocketing energy prices, declining dollar and overall economic situation—have conspired to give investors a seemingly endless supply of both up and down days in the market.
July 21, 2008
If you happened to be on vacation the past two weeks and did yourself the ultimate favor of ignoring newspapers, radio, CNBC, network nightly newscasts (and perhaps your favorite bartender if you have one) you might have concluded that so far, July has been slow and boring.
July 7, 2008 US markets ended the shortened July 4th trading week on a positive note — a needed respite from the carnage in the markets we’ve seen the past two weeks. At least temporarily though, the bear is back, as the Dow Jones Industrial Average and NASDAQ Composite officially reached bear market status on Wednesday July 2nd.
June 27, 2008 Surging food and energy prices and talk of a US recession have investors wondering whether the specter of 70s-style stagflation, surging inflation coupled with a slowing economy, is coming back to haunt them. If stagflation is returning, thankfully it looks different from the 70s experience this time around. And not just for the lack of huge sideburns and bell bottoms, but for economic reasons as well.
June 25, 2008
This Commentary will examine the candidates stated positions on some of the issues more likely to affect the financial markets: taxes, healthcare, and energy policy. The intent is not to endorse a candidate, or a particular policy, but rather present the facts as we understand them. To the greatest extent possible, stated positions will be taken directly from candidate websites, speeches, or neutral third parties. |
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