By now, you may have realized that this is not your father’s stock market, nor will it ever be again. An entirely new army of investors have arrived on the scene with different attitudes, values, and beliefs. You can either get on this train or be left behind. Back in the day, burnt by the Financial Crisis of more than a decade ago, many investors decided to forsake the stock market, embracing bonds instead. Over that time, Americans amassed more than $3 trillion in savings and 94% of that money went into bonds. Those bond buyers have had a good…
Insights & Advice
Tag: Bill Schmick
Brexit at last
After four years of squabbling, and nine months of last-ditch negotiations, the United Kingdom (UK) and the European Community (EU) have come to a compromise agreement. The deal is much more an economic partnership than a true parting of the ways. The new economic system covers large areas of bilateral trade, including autos, industrial materials, manufacturing, the pharmaceutical sector, as well as professional services. It also allows the UK freedom to set new standards in areas like the environment and labor laws, as long as any changes do not overstep European standards by too much. The idea is to maintain…
Stimulus bill vaults stocks to new highs
A much-needed fiscal stimulus bill is expected to pass at the eleventh hour by lawmakers in Washington. Investors greeted that news by taking all three major averages skyward this week, with more gains in the offing. As I wrote last week, politicians are waiting until the very last day before passing a $903 billion stimulus bill. Thursday was supposed to be the deadline, and then Friday; talks may well stretch through the weekend at this point. In the meantime, another important piece of legislation, an extension of the government budget, had to be signed by Friday, December 18th to keep…
Vaccine hopes send stocks higher
The first real hope at ending the global coronavirus pandemic was announced on Monday. Drug company partners, Pfizer and BioNTech, announced their COVID-19 vaccine, which exceeded expectations. The news sent world stock markets screaming higher. Later in the week, some profit-taking developed, but overall, the news was met with relief and cautious excitement. Most investors expected the Pfizer drug would be, at best, 60-70% effective, so when the company announced it was more than 90% effective in preventing COVID-19, stocks soared. While this was great news, there are a few drawbacks to the vaccine. For starters, Pfizer can manufacture only…
Small town America is in vogue
The on-going coronavirus pandemic has boosted consumer demand for small town real estate. Whether that trend will continue with a vaccine on the horizon is anyone’s guess. In the meantime, it could be a godsend for those looking to retire and possibly downsize during this period. The obvious driver in this trend change has been the safety factor. The devastating carnage that occurred in the nation’s large cities during the first surge of the coronavirus convinced many families to pull up stakes and find dwellings as far from the mayhem (and people) as possible. Home listings in small towns jumped…
Markets have already picked the winner
The nation spent most of the week wondering who won the presidential elections. While lawsuits, protests, and dueling press conferences occupied the airwaves and internet, global stock markets spent the time discounting the results. Have markets already picked the winner? A Joe Biden win, with a Democrat House, and a GOP-controlled Senate was the conclusion reached by the markets on Tuesday. The “blue wave” that investors had expected and believed would unleash trillions of dollars’ worth of stimulus, run up the national debt, and cause long-term interest rates to rise, was off the table. Instead, we would face at least…
The polling business takes a body blow
There has been one clear loser thus far in the outcome of the 2020 presidential elections and it is not the candidates. The polling industry has gotten it wrong twice in a row. Can the industry survive that kind of mistake? As votes across the nation continue to be counted, the pollsters and the media, which count on those polling results, are asking how Vice President Joe Biden’s 10-point lead nationwide could have evaporated in the blink of an eye. Political polling is a type of public opinion polling, which in the past (when done right), is a fairly accurate…
The market’s Halloween fright
This has been the worst presidential, pre-election week for stocks—ever. But the worst may be over. October has come to an end. Now all we need to do is get through a presidential election and its aftermath, and hope that Americans come to their senses in dealing with this pandemic. That is a lot to hope for. Prior to this week, the sharpest pre-election market decline on record dates back to 1932. Given the apocalyptic campaign predictions of what will happen if the other guy wins, who could blame investors for getting spooked? But the real impetus for driving markets…
Politicians play cat and mouse with investors
It was a week of will they or won’t they. Both parties claimed to want another stimulus deal done before the election, but the proof is in the pudding and as of Friday, the plate is empty. Investors may be coming to the conclusion that the latest negotiations between the Democrats, led by House Speaker Nancy Pelosi, and Republican U.S. Treasury Secretary Stephen Mnuchin, and White House Chief of Staff Mark Meadows, was simply an election ploy. A way to set up the other side for failure, while making their own position look both caring and, at the same time,…
The pandemic has been good to the pet industry
Sales are increasing wherever you look in the pet sector. Toys, beds, grooming products, leashes, day care, you name it; the pet industry is experiencing double-digit increases in revenue. Better yet, there are few signs that consumer spending in this area will slow down anytime soon. As readers are aware, the retail sector has been one of the hardest hit as a result of the coronavirus pandemic. The pet care industry is an exception to that rule. In the past, I have written extensively about how recession-proof the pet industry can be. In both the 2001 and 2008 recessions, pet…
Investors reduce risk as stimulus talks fail
Hope springs eternal, but even the most strident bulls threw in the towel this week. American politics took precedence over the country’s economic well-being once again, as both political parties refused to compromise on a stimulus deal. But it wasn’t only politics that spooked investors. Across the Atlantic, investors watched as COVID-19 outbreaks escalated across Europe. Germany, Austria, the Czech Republic, and Italy reported new records in infections, while France announced a curfew in order to stem their own skyrocketing cases. In the U.K., Londoners are now banned from mixing with other households indoors. In this country, despite denials by…
Markets feel the heat
First, the good news: there is only one more week until the end of the month. The bad news, however, is that October may not treat investors any better than did September. As my swabbie friends would say, is it time to “batten down the hatches.” Let me say, I take no joy in being right. During the last few weeks of writing, the volatility I predicted has come home to roost. This kind of correction is especially painful because in these times of great uncertainty, we could have at least pointed to the stock market, and our investments accounts,…
Investors face a roller coaster ride
Volatility returned to the stock market this week as the level of uncertainty increased on several fronts. Unfortunately, there won’t be any definitive answers to what concerns investors for at least two months. It is September, after all, and this month is notorious for inflicting pain on investors. Historically, October is not much better, and in a presidential election year it can be worse. While the financial media will provide their thoughts on just why stocks drop or rise on any given day, it is not much use to you. The real reason for “why” will only be known after…
Bicycles sales are booming
In the age of the pandemic, some industries have thrived. Take the bicycle industry, for example; sales have more than doubled this year, and the only impediment to further growth seems to be the availability of product. Thanks to COVID-19, biking has become a global phenomenon. The real growth is centered in the metropolitan areas, where much of public transportation has been curtailed due to the infectious nature of the virus. In April alone, bicycle industry sales grew by 75% to $1 billion year-over-year, according to bike manufacturer, Huffy. Leisure bikes, those that sell for under $200, jumped 203%, while…
Market’s correct imbalances
It always happens. Sometimes it takes longer than one would like, but sanity returns to the stock market when you least expect it. The only word that accurately described the stock market at the beginning of this week was “parabolic.” On Tuesday, believe or not, the total worth of just one stock, Apple, was larger than the entire value of the Russell 2000 small cap index. It was also much greater than the entire value of the U.K. stock exchange. Story stocks like Tesla were rising along with the technology-heavy NASDAQ index. Stay-at-home stocks were logging daily gains that in…
Mask mania helps small business
There was a time, when obtaining a protective mask to combat the spread of the coronavirus was almost impossible. That time has passed. Today, as more than half the country requires citizens to wear them, masks have become essential and almost a fashion statement. Back in March of this year, as COVID-19 raged across the country, first responders were desperate for all kinds of protective gear. In the Berkshires, where I sit, a cottage industry developed. Volunteers on home sewing machines were producing masks and delivering them to the local hospitals. Various small businesses around the nation were also producing…