The U.S. Congress is an embarrassment. The latest fiasco is only one of a long line of stupid actions on their part. We have learned to expect the worst, and then it’s even worse than expected. There has never been a Congress in the history of the United States that is so universally loathed.READ MORE
When it’s spring in Paris (or Egypt), it’s time for demonstrations in the street. When it’s summer on Wall Street, it’s time for a correction. Maybe you can’t set your watch by it, but it seems to happen often enough. This one is a little different because it started in the bond market. They are always a little different. It may not be over yet, because if it isn’t scary it doesn’t count. This one was only a little scary – so far.READ MORE
I was recently in Costa Rica on vacation for the first time. Our group loves to try the native cuisine and in addition to many servings of gallo pinto (rice and beans for breakfast with salsa), we also tried the local cane spirit – guaro. Finding that it went down suspiciously like aftershave, we sought help from our rainforest tour guide on how to concoct a suitable guaro cocktail. After a 12 hour day of driving, horseback riding, zip-lining, mud bathing and more driving, he joined us for a lesson on Costa Rican cocktail mixology. How bad is guaro straight? The locals refer to the experience as tragar un gato a la inversa, or roughly translated, “swallowing the cat backwards.”
This is an old Wall Street saying that refers to both the desire to go on vacation in the summer, and to the seemingly common occurrence of a correction during the summer months. There is some truth to this. The S&P 500 has averaged a return of 1.2% in the May-to-October interval since 1945, compared with 6.9% from October through April.READ MORE
The first quarter was very strong for equity markets. The S&P 500 was up 10.6% with smaller companies up even more. International equities lagged, gaining only 5% for the developed markets and emerging markets falling 1.6%. Bonds were down slightly and gold lost almost 5%, so itcould be described as a “risk on” quarter.
Sargent Bickham Lagudis’ March 2013 newsletter is now available for your reading pleasure.
An excerpt from the latest issue:
After so many deadlines and crises, we are moving away from giving the politicians our attention. They will periodically bring the spotlight on themselves as narcissists are wont to do, but increasingly the financial markets are going to pay less and less attention to them. And that would be a wonderful thing!