Jeff Benjamin

Investment Insights: The Blogblog

Jeff Benjamin breaks down the game for advisers and clients.

6:30 am EST

Fed officials feel the heat heading into Jackson Hole meeting

By Jeff Benjamin

All eyes are on the Federal Reserve's meeting this Friday in Jackson Hole. There is hope the Fed will step up and fix this mess they are calling the new normal. The pressure is mounting. Follow Michael Kitces’ advice on navigating inherited retirement accounts. The caveats, examples and some help from Congress. The new money market rules will at least partially address the false promise of what your money is really worth. Risky products shouldn't be sold as safe. Just because it's almost September doesn't mean you can't still be thinking about saving for that dream vacation. This is how you can make it happen. ... Read full post

Aug 22, 2016

A case for cash when stock prices are off the charts

By Jeff Benjamin

Sometimes the best investment move is toward the sidelines, especially when stocks and bonds are both teetering near record highs. The case for cash. Former hedge funder, Steve Eisman, who is now with Neuberger Berman, says hedge fund fees are going the way of the white tennis ball. The end is near for lucrative 2-and-20 fee structures. Tip of the hat to American Growth Fund (AMREX) for becoming the first diversified mutual fund dedicated to the marijuana industry. The move is both edgy and aggressive because pot is still illegal at the federal level. The financial logic behind not getting married. Unmarried couples can deduct twice as much of their mortgage and home interest on tax returns. ... Read full post

Aug 19, 2016

Morningstar demystifies 401(k) loans

By Jeff Benjamin

Morningstar's Christine Benz cracks to code on those perplexing 401(k) loans. Dissecting the pros, cons and myths of borrowing from a retirement account. The Department of Justice moves to phase out the use of private prisons for federal inmates. Investors in private prison stocks make a jailbreak. SEC to U.S. public companies: Knock it off with the fuzzy math, because we're going to start paying closer attention. The companies should expect stern letters if they fail to comply. Who says breakfast can't be both healthy and fast? Do it yourself. ... Read full post

Aug 18, 2016

Smart beta finds fixed income

By Jeff Benjamin

Fixed income shapes up as the next frontier for smart-beta strategies. A small but strong showing. The haters are gonna hate this, but things might be shaping up for the start of a bear market for bonds. The momentum is just getting started. The Vanguard Group is leading the pack this year in net asset flows. Franklin Templeton secures the cellar. The latest signs that Obamacare is collapsing under its own weight. The four largest U.S. insurers are each losing hundreds of millions of dollars through their Obamacare plans. ... Read full post

Aug 17, 2016

Billionaire Paul Tudor Jones makes a costly big short on the market

By Jeff Benjamin

Hedge funder Paul Tudor Jones continues to double down on his big short of the U.S. stock market. He now owns puts on 8.34 million shares of SPDR S&P 500 (SPY). Meanwhile, as the stock market chugs along, seemingly defying gravity and logic, the billionaire's big bet is forcing him to cut 15% of the workforce at his $11 billion hedge fund. If you're already unhappy about not having a pension to fall back on, you will be doubly unhappy about the $6 trillion bill taxpayers are being stuck with because public pension plans made an actuarial snafu. Math is hard. A strict focus on each company's return on equity puts the Jensen Quality Growth Fund (JENIX) consistently above the benchmark. Looking for business returns above the cost of capital. The plight of the golf business is creating awkward stances and uneven lies in the suburbs. “Nobody's tracking what's happening to the land.” ... Read full post

Aug 16, 2016

Davis Selected Advisers enters the ETF market

By Jeff Benjamin

Davis Selected Advisers is the newest entrant into the exchange-traded fund market. The fund company, best known for Davis New York Venture (NYVTX), a stock fund languishing in the 87th percentile among its peers the past decade, has filed with the Securities and Exchange Commission for permission to roll out Davis Focused US Equity ETF (DAVS), Davis Select Financial ETF (DSFE) and Davis Select World Opportunities ETF (DSWO). Crude oil prices — West Texas Intermediate, that is — are up year to date. While that's good for energy funds, up more than 18% this year, it's also good news for those taking Social Security and those owning Treasury Inflation Protected Securities. Both are dependent on the headline consumer price index, which includes the volatile energy sector. How did Ronald Reagan end the 1981 recession? Tax cuts, sure. Then again, there was his massive dose of federal spending. Thanks, Judge Forrest!... Read full post

Aug 15, 2016

Consumer confidence at odds with rising stock market

By Jeff Benjamin

The stock market has been rising but consumer confidence hasn't followed along during the past two years. In fact, executives of consumer companies say economic and political uncertainty is repressing consumer confidence. Millennials place so much trust in the power and promise of technology that they could turn away from traditional banks in favor of consumer-finance startups. Firms like Chime and Simple hope their apps will win over the younger Americans. Are you trained in programming languages such as SQL, JavaScript and Python? If you are, you're ahead of the game as a new survey says being able to code is a skill that more and more employers are seeking. American swimmer Ryan Lochte, whose success in the pool has been overshadowed by a much more successful Michael Phelps, just can't catch a break. Mr. Lochte on Saturday night was among a group of Team USA Olympic swimmers robbed at gunpoint in Rio. ... Read full post

Aug 12, 2016

Insider buying patterns say now is the time to sell

By Jeff Benjamin

If you're still seeing this frothy stock market as a keen buying opportunity, you might want to consider that most corporate insiders don't share those views. Insiders are selling. Hillary Clinton's full-throated pitch to promote middle-class prosperity is missing one key element: Corporate tax reform. Reforming corporate taxes is seen as among the best ways to get businesses to spend more and create more jobs. Nest egg? What nest egg, said two-thirds of Americans. Sadly, most folks can't come up with $1,000 to cover the cost of an emergency expense. For fans of marijuana, and marijuana investments, the bad news is, the U.S. Drug Enforcement Administration announced that it is not changing the federal legal status of pot. The good news is that the DEA is increasing the amount of pot available for medical research. Suddenly, one man's research becomes another man's recreation. Taking the good with the bad. ... Read full post

Aug 11, 2016

Rob Arnott says cheesy copy cats are hurting smart beta investing

By Jeff Benjamin

Rob Arnott, a pioneer of smart-beta investing, says the growing popularity of the investing style has gotten out of hand. Perhaps he longs for the good old days when almost nobody believed in smart beta. “There are a lot of dumb ideas masquerading as smart beta.” Jim Grant says investing in gold works because the global financial system is off its rocker. This is unfortunately what happens when central banks lose control of monetary policy. Corporate bond issuance shoots off the charts in early August. What's up with that? The wave of new debt issuance is in line with a sharp tightening of credit spreads. Somehow in this economy that has never really gotten off the ground since the financial crisis, layoff levels are at a two-year low. Don't tell the economists, but this has to do with the fact there are fewer people left to layoff. The economic recovery shows signs of aging. ... Read full post

Aug 10, 2016

Bond bears are starting to look smart

By Jeff Benjamin

After years of being so wrong, it looks like bond bears might finally be right. It's vindication time. Sizing up the Trump and Clinton tax plans. How do you like your taxes? High or higher? Take a gander at what $12.29 trillion worth of household debt looks like. It's mostly mortgages, but student loans are gaining steam. Congrats on making it to retirement, now here are the skills you'll need to make it in retirement. Learn to relax. ... Read full post

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