Jeff Benjamin

Investment Insights: The Blogblog

Jeff Benjamin breaks down the game for advisers and clients.

7:59 am EST

The bitter economic costs of cheap oil

By Jeff Benjamin

Cheap oil threatens the U.S. energy boom and the fallout is not optimal. In the shale business it's not as easy as just reducing production. West Texas Intermediate crude prices are down 23% since June Banking on a rising dollar. While still not at full speed, the U.S. economy is ahead of the global recovery cycle and there are reasons to believe the resurgence of the dollar is just beginning. Paying less for foreign goods and services Making the case for investing in bond funds gets tougher by the day. No longer the safe side of the portfolio. One-day Treasury bond rallies are not why you hold bonds Bullish billionaire Paul Tudor Jones expects U.S. stocks to crush the globe for the rest of the year. 'The piper will be paid one day' Taking advantage of increased market volatility. It's not all about ducking for cover. Hedging out the bumps ... Read full post

Oct 20, 2014

How leverage led the market sell-off

By Jeff Benjamin

Leverage is being singled out as the source of last week's sell0off. When the fur is flying, you sell what you can, not always what you want. 9.6 billion shares a day changed hands on U.S. stock markets last week; more than double the final week of August Market turbulence is seen lasting at least through the Nov. 4 mid-term elections. Keep in mind that the upside of volatility is that it moves both ways. 'Definitely a buyable dip' The economic tragedy of Ebola. This will not make you feel better. Sick people cannot work. Scared people will not work. Roth 401(k) give Roth fans another option, but time will tell if the IRS can keep up and if Congress can keep away. Combining traditional and Roth plans adds a smart retirement planning tool When Robert Shiller starts to doubt his own CAPE ratio, the pace of change in the financial world starts to get scary-apparent. Regardless the reasons, selling is increasing and there is not much... Read full post

Oct 17, 2014

Fattened by the Federal Reserve, the markets want more

By Jeff Benjamin

The markets are looking to the Fed for help, any help at all. Is it possible the end of quantitative easing could be later, rather than sooner? Seeking a lifeline in a single phrase or reference Hawkish Fed member gives the nod to extending quantitative easing beyond October to appease and calm the financial markets. Seems like somebody should have realized a long time ago that a big, fat market fed by the Fed will always want more, not less. Putting a taper delay on the table Gold is back as the safe choice. If it seems obvious, that's because it is. GLD has erased losses for the year Investing on leverage might be less risky than other forms of borrowing you are probably already doing. If you own a car or a house you're already doing it ... Read full post

Oct 16, 2014

Market strategists unbowed

By Jeff Benjamin

The rout in stocks has not pushed market strategists to cut their year-end forecasts. It's just going to take a bigger rally to get there. S&P 500 rout leaves Wall Street unbowed as tide ebbs on calls But that resolve could be tested today. Treasuries gain as oil drops below $80 while stocks slide It's heat of earnings season and some of the numbers look good. Goldman Sachs profit gets big boost from bond market pick up Here's what some pundits say will lift the stock market out of its funk. Go to Switzerland for skiing, not for annuities If Fed chair Janet Yellen was facing a conundrum yesterday, it's worse today. What the heck should the Fed do now? Thursday is Day 2 of InvestmentNews' Fourth annual Alternative Investment conference. Follow all the action on Twitter at #alts2014 ... Read full post

Oct 15, 2014

Buckle up for more volatility

By Jeff Benjamin

Amid the stock market's gyrations, one thing is clear: Volatility will be around for some time. So buckle up. Stocks are tumbling, oil is sinking, and bonds are going vertical Several signals point to an improving economy but you wouldn't know it looking at consumers. The reason Americans are spending less. And there's this: The reason Americans are spending less Investors are giving Fed chief Janet Yellen her first real test as they send markets reeling over worries about economic growth. Curse of the new Fed chief? If someone you know is pitching Swiss annuities, just walk away. Go to Switzerland for skiing, not for annuities How is Bill Gross doing i his new gig at Janus beyond money flows and performance? Well he's got a smaller office. Can you cram Bill Gross into 2,500 square feet a 5-Minute walk from Pimco? Yes' Shameless plug: InvestmentNews' Fourth annual Alternative Investment conference starts today in the Windy City.... Read full post

Oct 14, 2014

When in doubt, follow the bond market's lead

By Jeff Benjamin

As the Fed frets over inflation, the bond market has already made up its mind and moved on. With motives and ulterior motives as your guide, especially considering how intertwined monetary policy has become with fiscal policy, the smart play is to trust the bond market. Bond traders show little fear of inflation Once again, it all comes down to the consumer. Now, go out and spend money. It's good for the economy and it feels good because the dollar is strong and stuff is getting cheap. Global unrest has never stopped a U.S. consumer from buying a new T.V. Abigail Johnson takes the helm at Fidelity, ascending to a job for which she has been groomed for many years. Already president, the new CEO title described as 'largely ceremonial' Calvert Investments finds its next CEO in Oregon at Portfolio 21. John Streur will take over for Barbara Krumsiek in January Artists and supermodels became contra-indicators as currency speculators. 'I... Read full post

Oct 13, 2014

Earnings season shapes up as the next test for the markets

By Jeff Benjamin

Third-quarter earnings could be the next reality check for stocks, and for investors. As the reports start rolling out this week there are reasons to worry, but not panic. The five-year corporate earnings love story heads for a rough patch An OPEC rift is fueling an oil price war that will provide relief at the pump. But the ultimate objective is to tamp down U.S. energy production. Pushing for the breaking point of $76 a barrel Plunging oil prices are spooking the markets. The ripple-effects of the supply-side shock could mean red ink for energy stocks. The factors opening the trapdoor beneath oil prices A rare hawkish tone out of the Fed suggests the global economy will not suffer much from a rate hike in the U.S. Preparing market participants for what lies ahead Advisers get high marks from clients in the latest Cerulli report, and that satisfaction level is helping advisers carve out a bigger piece of the defined contribution plan ... Read full post

Oct 10, 2014

Market chop puts alternative strategies front and center

By Jeff Benjamin

It's not too late to add some portfolio insurance in the form of liquid alternatives. Here are some mutual funds that have been stacking up nicely against their more expensive hedge fund counterparts. Better examples of hedge funds than hedge funds The 200-day moving average is the next threshold on focus for stocks. 'We seem to be in that anxiety zone that often gives way to decent corrections' New market volatility has investors assuming the worst. This might be a good for financial advisers to remind clients about the opportunities to buy on the dip. The glass suddenly looks half empty A lack of inflation is front and center at the Fed. The upside is, this looks like another reason to delay a rate hike. The downside is, the Fed can't seem to find a tactic for triggering price increases. 'Too-low inflation is getting to be a real issue again' China's economic bubble looks like the big thing to worry about. This is what happens when... Read full post

Oct 9, 2014

Markets are poised to ride the Fed doves even higher today

By Jeff Benjamin

The Fed-minutes rally could have legs. The market is loving the dovish tone related to the stronger dollar and the weaker global economic outlook. More economic data out today, and more earnings Putting the strength of the dollar in perspective. Less pain at the pump, but multinationals will suffer. The viscous cycle ultimately has to come back around to hit the consumer. Americans are taking the rising dollar in stride for now Meanwhile, China looks poised to duke it out in a full-blown currency war. A strong dollar could catch the U.S. flat-footed. 'A major, slow-motion shock for the world and financial markets' JPMorgan hack attack was just the tip of the iceberg. The threat extended to more than a dozen other major financial firms. Warning signs in firewalls Pimco's slippery comparisons between Bill Gross and Dan Ivascyn could trip up less-savvy investors. It has the markings of a misleading and desperate marketing ploy.... Read full post

Oct 8, 2014

Equity markets buckle up for FOMC minutes, Alcoa earnings

By Jeff Benjamin

The stock market will dust itself off from Tuesday's carnage to brace for today's minutes from the September FOMC meeting, as well as Alcoa kicking off third-quarter earnings. Some are blaming a weakened European economy for the pullback, but in such a nervous market, the tipping points are everywhere. Fewer companies expected to beat revenues estimates, but the outlook is better for earnings The race for the billions of dollars set loose from the Pimco Total Return Fund over the past few weeks is being won by a handful of ETFs. A bright spot for select fixed-income ETFs Where the bond bears are getting it right, and where they're getting it wrong. This is what happens when investors try to discern the short-term future of the markets. Not being haunted by fixed-income questions that can't be answered A Morgan Stanley analyst, who probably doesn't own a car, calls for the end of the auto industry as we know it. This will sound like... Read full post

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