40 results found

In the last two weeks, very important data on the US economy and corporate earnings have been released. These depressing data are as we had predicted. It remains true that the S&P 500 should drop by 35% from its 1 January level.

The US jobs report this past week was euphoric and propelled the stock market to even higher levels. But after the easy gains over the next two or three years from reopening the service sector, the US economy faces a slow nine-year recovery. US equities remain overvalued.

Many in the financial markets are expecting a V-shaped recovery starting in the fourth quarter of this year, possibly even in the third quarter. Robert Huebscher speaks with renowned economist, Dr Woody Brock about why Woody disagrees, and instead foresees a slow and uneven recovery with periodic slumps.

Coronavirus has put an end to the longest post-war US expansion, and is all but certain to cause a recession that will be wholly different from any other in economic history. In this podcast, Robert Huebscher speaks with renowned economist, Dr Woody Brock, about how and why.

Two weeks ago as the coronavirus crisis began to unfold, I warned that the market could soon drop to 17,500 on the Dow. One very important form of investor ignorance today concerns the market's view that it is prospects for corporate earnings that will matter most. This is wrong.

The new virus is an "unknowable unknown" of the first order. Should the virus turn into an epidemic, all Americans will alter their behavior, such that an outright recession could result.

What strategy should a rational investor, completely free of constraints, take to preserve wealth while making modest long-term gains? To do so will not be easy over the next two decades.

Woody Brock | 1 comment | 1.00 CE

Five misplaced concerns about the future of the dollar make forecasts of a long-run collapse in the dollar problematic.

Woody Brock | 0.50 CE

We give a 20% chance to a US corporate debt bubble burst before end 2020. It is both incredible and unconscionable that massive leverage could once again bring down Main Street a mere decade after 2008.

The fallacy that an inverted yield curve "predicts" the onset of recessions is alive and well. Many investors believe the curve will invert in 2019, precipitating a recession. But a flattening of the yield curve need not imply a recession.

President Trump's protectionist threats have raised the risks of a serious trade war, the first in over 80 years. It is assumed that this would materially impact US growth - but is that the case?

Was the recent market volatility predictable? Was the volatility exogenous or endogenous in nature? What lies ahead as regards inflation and interest rates?

The investment (as opposed to transaction) appeal of Bitcoins has grown and will grow. But we believe that Bitcoin will be very undesirable as an asset due to a very high degree of price volatility.

During the past three months, a salient topic of debate has been whether the so-called Phillips Curve is relevant in today's disinflationary environment. The debate is important to investors.

Twenty years ago, I predicted that the Digital Revolution would cause productivity growth to accelerate and inflation and interest rates to fall for a very long period. We now believe this trend will continue for at least another 10 and probably 20 years.

The growing belief that the US has entered an era of permanently low economic growth, due in large measure to an alleged 50% reduction in productivity growth, is wrong. Both real growth and productivity growth have been strong, not weak.

Overall stock market risk has declined modestly in the last 80 years, but the nature of risk has changed greatly. The risk stemming from market mistakes and, possibly, from irrationality has risen significantly.

Despite increasing global political risk, the probability of outright war is paradoxically lower than it might have been at any previous period in history.

In a world of risk-on/risk-off investing, it is important for investors to know where true risks lie and where they do not lie. In fact, macroeconomic risk has decreased by well over 80% during the eight decades.

Contrary to popular belief, western living standards have not declined in recent decades. Rather, government statistics failed to capture a key element of real GPD growth.