Tag Archive: Alhambra Research

Monthly Macro Monitor – October 2018

2018-10-24

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2018-10-24

Economic Growth & Investment
Stocks have stumbled into October with the S&P 500 down about 6% as I write this. The source of equity investors’ angst is always hard to pinpoint and this is no exception but this correction doesn’t seem to be due to concerns about economic growth. At least not directly.

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Monthly Macro Monitor – September

2018-09-20

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2018-09-20

Economic Growth & Investment September 20
This has already been one of the longest economic expansions on record for the US and there is little in the data or markets to indicate that is about to come to an end. Current levels of the yield curve are comparable to late 2005 in the last cycle. It was almost two years later before we even had an inkling of a problem and even in the summer of 2008 – nearly three years later – there was still a robust debate about whether the US could avoid...

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Global Asset Allocation Update – September 2018

2018-09-11

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2018-09-11

Moderate Allocation, Sep 2018
The risk budget is unchanged again this month. For the moderate risk investor, the allocation between bonds and risk assets is 50/50. Decoupling anyone? That’s what the market is whispering right now, that the recent troubles in foreign economies is contained and won’t affect the US. The most obvious example of that trend is the performance of US stocks versus the rest of the world.

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Monthly Macro Monitor – August

2018-08-23

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2018-08-23

Economic thoughts and analysis from Alhambra Investments CEO Joe Calhoun.

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Monthly Macro Monitor – August 2018

2018-08-17

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2018-08-17

US Real GDP, Q1 2013 - Q1 2018
The Q2 GDP report (+4.1% from the previous quarter, annualized) was heralded by the administration as a great achievement and certainly putting a 4 handle on quarter to quarter growth has been rare this cycle, if not unheard of (Q4 ’09, Q4 ’11, Q2 & Q3 ’14). But looking at the GDP change year over year shows a little different picture (2.8%).

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Global Asset Allocation Update – (VIDEO)

2018-08-08

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2018-08-08

Economic thoughts and analysis from Alhambra Investments CEO Joe Calhoun.

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Global Asset Allocation Update

2018-08-02

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2018-08-02

Moderate Allocation 50-50 risk budget
The risk budget is unchanged again this month. For the moderate risk investor, the allocation between bonds and risk assets is evenly split. The only change to the portfolio is the one I wrote about last week, an exchange of TIP for SHY.

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Global Asset Allocation Update

2018-07-27

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2018-07-27

50-50 Risk budget
Note: This will be a short update. We are shifting the timing of some of our reports. The monthly Global Asset Allocation update will now be published in the first week of the month, aiming for the first of each month. I’ll put out a full report next week. The Bi-Weekly Economic Review is shifting to a monthly update, published on the 15th of each month.

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Bi-Weekly Economic Review

2018-07-20

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2018-07-20

Economic Growth & Investment
This will be a fairly quick update as I just posted a Mid-Year Review yesterday that covers a lot of the same ground. There were, as you’ll see below, some fairly positive reports since the last update but the markets are not responding to the better data. Markets seem to be more focused on the trade wars and the potential fallout. I would also note that at least some of the recent strength in the data is related to the tariffs.

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Mid-Year Global Markets Update

2018-07-19

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2018-07-19

S&P 500
Volatility returned to markets with a vengeance in the first half of this year. 2018 started off as an extension of last year when volatility was almost wholly absent. Stocks roared out of the starting gate, up almost every day until January 26th. And then – whoosh. What took nearly a month to gain took just 6 trading days to give back and then some.

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Bi-Weekly Economic Review

2018-06-22

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2018-06-22

10-Year Treasury Constant Maturity Rate 1990-2018
Is the rate hiking cycle almost done? Not the question on everyone’s minds right now so a good time to ask it, I think. A couple of items caught my attention recently that made me at least think about the possibility.  There has been for some time now a large short position held by speculators in the futures market for Treasuries.

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Global Asset Allocation Update

2018-06-21

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2018-06-21

Global Asset Allocation Update
The risk budget is unchanged this month. For the moderate risk investor the allocation to bonds and risk assets is evenly split. There are changes this month within the asset classes. How far are we from the end of this cycle? When will the next recession arrive and more importantly when will stocks and other markets start to anticipate a slowdown?

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Global Asset Allocation Update

2018-05-17

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2018-05-17

Moderate Allocation
The risk budget changes this month as I add back the 5% cash raised in late October. For the moderate risk investor, the allocation to bonds is still 50% while the risk side now rises to 50% as well. I raised the cash back in late October due to the extreme overbought nature of the stock market and frankly it was a mistake. Stocks went from overbought to more overbought and I missed the rally to all time highs in January.

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Bi-Weekly Economic Review: Oil, Interest Rates & Economic Growth

2018-05-09

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2018-05-09

Economic Growth and Investment
The yield on the 10 year Treasury note briefly surpassed the supposedly important 3% barrier and then….nothing. So, maybe, contrary to all the commentary that placed such importance on that level, it was just another line on a chart and the bond bear market fear mongering told us a lot about the commentators and not a lot about the market or the economy.

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Bi-Weekly Economic Review: Interest Rates Make Their Move

2018-04-27

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2018-04-27

Economic Growth and Investment
How quickly things change in these markets. In the report two weeks ago, the markets reflected a pretty obvious slowing in the global economy. In the course of two weeks, what seemed obvious has been quickly reversed. The 10-year yield moved up a quick 20 basis points in just a week, a rise in nominal growth expectations that was mostly about inflation fears.

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Bi-Weekly Economic Review: Investing Is Not A Game of Perfect

2018-04-11

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2018-04-11

Economic Growth and Investment
The market volatility this year has been blamed on a lot of factors. The initial selloff was blamed on a hotter than expected wage number in the January employment report that supposedly sparked concerns about inflation – although a similar number this month wasn’t mentioned as a cause of last Friday’s selling. The unwinding of the short volatility trade exacerbated the situation and voila, 12% came off the market in a matter of days.

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Bi-Weekly Economic Review: Embrace The Uncertainty

2018-03-28

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2018-03-28

There’s something happening here What it is ain’t exactly clear There’s a man with a gun over there Telling me I got to beware I think it’s time we stop, children, what’s that sound Everybody look what’s going down There’s battle lines being drawn Nobody’s right if everybody’s wrong Young people speaking their minds Getting so much resistance from behind It’s time we stop, hey, what’s that sound Everybody look what’s going...

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Bi-Weekly Economic Review: The New Normal Continues

2018-03-14

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2018-03-14

There has been a lot of talk about the economic impact of the recent tax reform. All of it, including the analyses that include lots of fancy math, amounts to nothing more than speculation, usually informed by little more than the political bias of the analyst. I am guilty of that too to some degree but I don’t let my personal political views dictate how I view the economy for purposes of investing.

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Global Asset Allocation Update: Tariffs Don’t Warrant A Change…Yet

2018-03-12

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2018-03-12

Moderate Allocation
There is no change to the risk budget this month. For the moderate risk investor the allocation to bonds is 50%, risk assets 45% and cash 5%. We have had continued volatility since the last update but the market action so far is pretty mundane. The initial selloff halted at the 200 day moving average and the rebound carried to just over the 50 day moving average.

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Bi-Weekly Economic Review: One Down, Three To Go

2018-03-01

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2018-03-01

US Leading Index, 1984 - 2018
We pay particular attention to broad based indicators of growth. The Chicago Fed National Activity Index and the Conference Board’s Leading Economic Indicators are examples. We watch them because we are mostly interested in identifying inflection points in the broad economy and aren’t as interested in the details. Why? Because, while bear markets do happen outside of recession, it is rare and unpredictable.

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