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Category: Financial Industry

Is Gold Worth Its Weight in a Portfolio?

Is Gold Worth Its Weight in a Portfolio?

During a weak global economy and uncertain financial markets, many investors tout the benefits of holding gold. Some proponents claim that gold deserves a significant weighting in most investors’ portfolios. Gold’s often-cited portfolio benefits include a strong long-term return, a hedge against inflation, and safe haven during turbulent times. But does the evidence build a […]

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Questions to Ask a Financial Advisor

Questions to Ask a Financial Advisor

Many industry brokers or financial advisors lack the training, knowledge, and sometimes even experience, to truly benefit their clients’ financial planning. Add to this that many of these financial advisors work in a system rife with conflicts of interest and you have a recipe for financial peril. With the transparency that the internet offers, investors […]

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Goldman Sachs, Greg Smith & What It Means to be a Fiduciary

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I grew up next to a cornfield in Syracuse, New York. To me, a boy at the time, that cornfield was the most wonderful place on earth.  Sometimes, my friends and I would disappear into that field for hours at a time playing hide-n-seek or tag. Other times, we would sit on the outskirts and […]

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2011 Review: Economy & Markets

2011 Review: Economy & Markets

The past year reminded investors that they should hope for the best, prepare for the worst, and be thankful when reality does not match their fears. Investors entered 2011 with hopes that the world economy would continue recovering from a long and painful deleveraging process. Equity markets had posted two straight years of positive performance, […]

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Lessons in Mutual Fund Flows

Lessons in Mutual Fund Flows

Since 2008, economic uncertainty and market volatility have tested the staying power of investors around the world. Many people fled equities during the worst months of the global financial crisis, while others waited for signs of a turnaround before investing more. Their emotional reactions may have exacted a large price on their wealth. The graph […]

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Sovereign Debt Ratings and Stock Returns

Sovereign Debt Ratings and Stock Returns

In early August, Standard & Poor’s downgraded US government debt from a top-rated AAA to AA+.1 In the weeks preceding the event, some market observers expected a downgrade to result in higher interest rates and lower stock returns. After the downgrade, yields on US government securities fell across the term spectrum as investors around the […]

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Thinking in Real Terms

Thinking in Real Terms

Since the onset of the financial crisis in late 2007, the Federal Reserve has used interest-rate cuts and other policy tools in an effort to fuel economic growth. Economists can debate the effectiveness of these policies, but everyone can agree that today’s low interest rates are a two-sided coin. Consumers, businesses, and government all benefit […]

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Municipal Bond Worries

Municipal Bond Worries

In 2010, prominent industry analysts warned of a looming fiscal crisis among state and local governments. Some experts even predicted widespread municipal bond defaults in the US.1 Investor fears intensified in late 2010 when the municipal bond market experienced one of its largest selloffs in decades, which drove down prices and raised yields.2 While factors […]

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Deficits, Debt, and Markets

Deficits, Debt, and Markets

As government spending hits record levels around the globe, some politicians, economists, and pundits are warning that rising indebtedness may drag down economies and financial markets. This issue has raised concern among investors who assume that a government’s fiscal policy is closely linked to the country’s economic growth and market returns. The graph below shows […]

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Does Monetary Expansion Stoke Inflation?

Does Monetary Expansion Stoke Inflation?

Since the financial crisis hit in late 2008, the US monetary base has more than doubled, from about $800 billion in mid-2008 to about $2 trillion in November 2010.1 When the Federal Reserve announced a second round of quantitative easing (QE2), it raised investor concerns that such actions would stoke inflation. The chart below shows […]

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