Tag Archive: Lance Roberts

Retail Exuberance Sets Market Up For A Correction

2025-02-18

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2025-02-18

Last week, we discussed the surge in retail exuberance in the market following the election of President Trump. "The market defies more negative news because retail investors continue to step in and "buy the dip." In our recent Bull Bear reports, we discussed the push by retail investors, but looking at retail sentiment is quite …

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The Impact Of Tariffs Is Not As Bearish As Predicted

2025-02-14

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2025-02-14

There are many media-driven narratives about the impact of tariffs on the economy and the markets. Most of them are incredibly bearish, predicting the absolute worst possible outcomes. For fun, I asked ChatGPT what the expected impact of Trump's tariffs will likely be. Here is the answer: "One of the immediate consequences of increased tariffs …

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Bull Bear Report – Technical Update

2025-02-11

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2025-02-11

I could not produce our weekly Bull Bear Report this past weekend as I presented at Michael Campbell's Moneytalks Conference in Vancouver. However, I wanted to use today's technical update to review some of the statistical analysis we produce each week in that commentary. Such is mainly the case given last Monday's "tariff" shock and …

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Forecasting Error Puts Fed On Wrong Side Again

2025-02-07

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2025-02-07

The Federal Reserve's record of forecasting has frequently led it to respond too late to changes in economic and financial conditions. In the most recent FOMC meeting, the Federal Reserve changed its statement to support a pause in the current interest rate-cutting cycle. As noted by Forbes: "The policy-setting Federal Open Market Committee agreed unanimously …

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Tariffs Roil Markets

2025-02-04

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2025-02-04

Over the weekend, President Trump announced tariffs of 25% on both Canada and Mexico, as well as a 10% tariff on China. Such was not unexpected, as contained in the Trump tariff Executive Order {SEE HERE}. Specifically, that order stated: "[Sec 2, SubSection (h)]: Sec. 2. (a) All articles that are products of Canada as defined …

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Bullish Exuberance Returns As Trump Takes Office

2025-01-31

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2025-01-31

Bullish exuberance is returning to the markets and the economy in a big way following the Presidential election. Such is particularly the case with recent executive orders signed by Trump, which fulfill Trump's promises to "Make America Great Again." Given that short-term market dynamics are driven primarily by sentiment, as investors, we can not dismiss …

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DeepSeek DeepSinks Bullish Exuberance

2025-01-28

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2025-01-28

On Monday, markets were rocked by news that a Chinese Artificial Intelligence model, DeepSeek, performed better than expected at a lower development cost. As we noted in our Daily Market Commentary yesterday: "The 3% panic sell-off on the Tech-heavy Nasdaq-100 futures is focused on the view that China’s DeepSeek AI model rollouts show AI products …

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Do Money Supply, Deficit And QE Create Inflation?

2025-01-24

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2025-01-24

I recently debated with Michael Pento, who made an interesting statement that increases in the money supply, the deficit, and a return to quantitative easing (QE) will lead to 1970s-style inflation. The recent experience of inflation in 2021 and 2022 would seem to justify such a view. However, is that historically the case, or was …

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Are Return Expectations For 2025 Too High?

2025-01-21

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2025-01-21

In a recent post, I discussed Wall Street's return estimates for 2025 for the S&P 500 index. To wit: "We have some early indications of Wall Street targets for the S&P 500 index, and, as is always the case, they are optimistic for the coming year. The median estimate is for the market to rise … Continue reading »

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Gardening Guide To Better Portfolio Returns In 2025

2025-01-17

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2025-01-17

As we head into 2025, investors are giddy over the market returns of the last two years. As shown, the annual returns, while elevated, have come with only average volatility along the way. However, while most analysts and investors expect 2025 to be another bullish year, there is always a risk of a more disappointing …

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Tactically Bearish As Risks Increase

2025-01-14

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2025-01-14

In last week's discussion with Thoughtful Money, I noted that we are becoming more "tactically bearish" as we progress into 2025. While we have remained primarily bullish in equity positioning over the last two years, several risks are now worth considering. However, it is critical to note that being "tactically bearish" does NOT mean we …

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Investor Resolutions For 2025

2025-01-10

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2025-01-10

I publish an updated version of my New Year “investor” resolutions yearly. The purpose of the process is to take an annual inventory of what I did and did not do over the last year to improve my portfolio management practices. As with all resolutions made at the beginning of a new year, it is not uncommon … Continue reading...

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“Curb Your Enthusiasm” In 2025

2025-01-07

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2025-01-07

"Curb Your Enthusiasm," which ran its series finale last year, starred Larry David as an over-the-top version of himself in a comedy series that showed how seemingly trivial details of day-to-day life can precipitate a catastrophic chain of events. The show never failed to deliver a laugh but also reminded me that unexpected events can …

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The Rules Of Bob Farrell – An Updated Illustrated Guide

2025-01-03

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2025-01-03

In a recent discussion on TheRealInvestmentShow, Bob Farrell and his 10 investment rules were discussed, which elicited several email questions asking, "Who is Bob Farrell, and where are these rules?". I often forget how old I have become, and the investing legends of my youth are no longer there and are lost to the sands of time. …

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Affordable Care Act & The Inflation Of Healthcare

2024-12-27

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2024-12-27

When the Obama Administration first suggested the Affordable Care Act following the Financial Crisis, we argued that the outcome would be substantially higher, not lower, healthcare costs. It is interesting today that economists and the media complain about surging healthcare costs with each inflation report but fail to identify the root cause of that escalation. …

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Prediction For 2025 Using Valuation Levels

2024-12-20

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2024-12-20

It’s that time of year when Wall Street polishes up its crystal balls and predicts next year's market returns. Since Wall Street never predicts a down year, these forecasts are often wrong and sometimes very wrong. For example, on December 7th, 2021, we wrote an article about the predictions for 2022. “There is one thing …

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Permabull? Hardly.

2024-12-17

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2024-12-17

I never thought someone would label me a "Permabull." This is particularly true of the numerous articles I wrote over the years about the risks of excess valuations, monetary interventions, and artificially suppressed interest rates. However, here we are. "Lance, you are just another permabull talking your book. When this market crashes you will still be telling …

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Economic Indicators And The Trajectory Of Earnings

2024-12-13

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2024-12-13

Understanding the trajectory of corporate earnings is crucial for investors, as these earnings significantly influence stock valuations and market performance. Economic indicators such as Gross Domestic Product (GDP), the Institute for Supply Management (ISM) Manufacturing Index, and the Chicago Fed National Activity Index (CFNAI) provide valuable insights into the economic environment that shapes company profitability. …

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Portfolio Rebalancing And Valuations. Two Risks We Are Watching.

2024-12-10

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2024-12-10

While analysts are currently very optimistic about the market, the combined risk of high valuations and the need to rebalance portfolios in the short term may pose an unanticipated threat. This is particularly the case given the current high degree of speculation and leverage in the market.

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The Kalecki Profit Equation And The Coming Reversion

2024-12-06

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2024-12-06

Corporations are currently producing the highest level of profitability, as a percentage of GDP, in history. However, understanding corporate profitability involves more than glancing at quarterly earnings reports. At its core, the Kalecki Profit Equation provides a valuable framework, especially when exploring the reasons behind today’s elevated profit margins and what could disrupt them. James …

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