CJ Newsletters

Investors Bide Their Time While Others Trade the Headlines

To say that this year, to date, has been eventful is an understatement. Following a horrendous close to 2018, the first four months of ‘19 brought us a market melt-up to a new record high (2945) for the S&P 500, courtesy of the Fed’s policy shift into neutral. Soon after, trade “friction” between China and the US devolved into warfare with escalating tariffs as the weapons of choice. That took the S&P back down again almost 7%. Meanwhile, regime change…

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The Fed Successfully Fine Tunes the Economy

As we approached the close to 2018, we witnessed something not seen often, if ever, in this modern era of monetary policy. The Do-Over, or Mulligan for you golfers out there. Typically, when the Fed speaks and the markets react, the FOMC committee Chair goes about his or her business of making the rounds of congressional committees and issuing cryptic statements subject to any number of interpretations by the financial media. The September 2018 policy statement was met by an…

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Can the US Expansion Float the Global Economy?

The period following the posting of our September 18th Outlook has been eventful, to say the least. Following an upbeat finish to the third quarter, the Fed laid an egg in early October with the release of a policy statement that left the impression among investors that it had abandoned its data-dependent approach and was on a mission to raise rates not only this month, but through all of 2019. That left a significant dent in the major averages, wiping…

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Will the Economy Drive the Market Even Higher in 2019?

In the first half of 2018, we put a long overdue correction in the rear view mirror. From there, the S&P 500 has built a nice base from which it has advanced to new record highs in the current quarter, claiming ownership of the record for what is arguably the longest bull market in history. In terms of total return, this market still trails the tech-fueled bull run of 1990-2000 by a good margin. While the talking heads constantly debate…

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It’s Time For Some Investors to be Cautious, Not Bearish

We’re awaiting the outcome of what is now a four-month long consolidation of the stock market that began on January 26th. In our latest letter to clients we pronounced that the last stage of the correction began on April 2nd. Some experts are speculating that this consolidation will be a launching pad for the next leg of this lengthy bull market while others see it as a precursor to the end of the cycle. No doubt, there will be another…

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Checking the Box on the Long-Awaited Correction

The suspense has ended. Finally after two years, the long-overdue market correction began the week of January 29th. Well, at least it did for those of us who define the “market” as the S & P 500. Here’s what you need to know if you’re keeping score: A decline of 10% or more from the market’s most recent high fits the classic description of a correction. A pullback of more than 20% defines a bear market. On February 8th, a…

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Tax Reform and the Return of Irrational Exuberance

As we enter the final month of 2017, all eyes are focused on the Halls of Congress as the much anticipated Tax Bill approaches the finish line. Last week the Senate passed its version of the bill that will now be sent to the Congressional Conference Committee for reconciliation with the House version. A final version of the bill is expected to emerge from committee sometime before Christmas. Upon passage, it goes to the president’s desk for signing. We were…

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The Market Shrugs Off Lots of News and Little Action

  As we enter into the last month of Q3, all eyes should be focused on the return of Congress to Washington for a final attempt at passing a budget and enacting tax reform before the close of 2017. Instead, the focus has been shifted to any number of items that we would put far down the list of priorities for investors and the markets: Repeal and Replace, Building a Wall, Tampering by the Russians, Pardoning Sheriff Joe, Defending and…

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Can Congress Deliver on What the Market is Promising?

  In our April letter to clients we stated the obvious: Government is anything but nimble in formulating policy. We shared that in the context of tempering our expectations for what might be accomplished in Washington this year. So far, our very modest expectations have not been exceeded. The crafting of a new Healthcare Initiative and Tax Reform Bill are essential to the budget process. Despite the flurry of late night, optimistic tweets emanating from the White House, those charged…

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The Market Rides Higher into a Less Than Certain Future

  In our year-end letter, we discussed how investors’ expectations were driving market returns higher in the post-election period. The post-inaugural period has proved to be no different. DOW 20000 was recorded within days of the inauguration and, following a week of consolidation, coasted through DOW 21000 a short month later. Just like that, Easy Peasy. That advance seemed almost too easily accomplished for those of us who invest in rather than bet on the stock market. Why? Because, aside…

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