Layoffs in a growing economy: Good or bad?

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If you believe the press and the Fed, the unemployment rate is an important barometer of our country’s economic “health,” as low unemployment is considered a positive sign. It seems natural to think that if more people are producing goods and services, we should be more productive as a nation. But in reality, things are […]

Apple & China: Still growing strong

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After the market closed last Wednesday, Apple Inc. (NASDAQ: AAPL) reported its 2nd quarter earnings to much delight. Apple addressed a number of issues in its earnings report, including: (1)   Revenue and net income (“earnings”) per share as well as earnings forecasts for next quarter (2)   The status of its share repurchase program (3)   The […]

Food Prices on the Rise

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After years of drought across the US, South America and Southeast Asia, we’re seeing one result in the form of higher food prices, especially beef and poultry. The Bureau of Labor Statistics reported last week that food prices gained +0.4% in February, the biggest monthly increase in almost two years. After rising +6.1% in 2012 […]

Russia Bullies Ukraine–Again

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The major news story of this week concerns the Ukrainian region of Crimea, now under de facto Russian military occupation after the collapse of its government earlier this year. If you ask the Russians, they are just doing their part to stabilize an otherwise unstable country that remains under the control of an illegitimate government. […]

Japan (finally) makes its QE move

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To put it mildly, Japan—the world’s third-largest economy—has been in a rut lately. By lately we mean the past 24 years. To see how bad it’s been, look no further than a performance graph of the Nikkei 225 (Japanese stock index) below. Since closing at an all-time high of 38,916 on December 29, 1989, following […]

Back to the Fifties

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Perhaps you are old enough to remember the 1950s, a decade characterized by US dominance, technological innovation, and rapidly increasing wealth among the middle class. It was also a period of rising interest rates and robustly appreciating stock prices. I humbly submit that the current decade looks, and may continue to look, a lot like […]

2014: An Orwellian Year?

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With January 2014 now in the record books, and the first trading day of February looking particularly ugly, investors are naturally becoming worried as to what might be in store for the rest of the year. For the statistic junkies among you, the MSCI World index fell -4.4% in January, making it the worst month […]

Turkey Shoot!

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Amid the recent havoc in emerging markets, Tuesday delivered a significant (and somewhat surprising) piece of good news as Turkey raised the average rate at which banks can borrow by 2.8%. Considering that the US Federal Reserve rarely adjusts the federal funds rate by more than 0.5% at one time, this is obviously a very […]

The rout that refreshes?

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Those of you who follow the stock market, even casually, know that we’ve had a nasty two days in global equity markets, with the MSCI All-Country World index tumbling -3.5% in just 48 hours. Today was the sharpest one-day drop since last June, and the biggest weekly decline since late 2011. Moreover, the selling was […]

Quantitative Easing and Tapering are overrated

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Happy new year to everyone from KCS! We appreciate the feedback we’ve received about our eNewsletter over the past year, and hope you’ll continue to share your thoughts with us. Questions and comments are welcome, as are topic suggestions for future newsletters. A quick review of Quantitative Easing November 2008:  Federal Reserve begins buying $600 […]

2013: Year in Review

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Like most years, 2013 will leave behind its winners and its losers. Stock market participants were (for the most part) rewarded for their bullishness, especially those who have been overweighted to US stocks. Even owners of European stocks had an excellent year, which may surprise you given the mostly bad news we’ve been hearing about […]

Not a Word about the “Fiscal Cliff”

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You’ve heard far too much about that whose name will not be mentioned. Instead, let’s talk about investing for retirement: (1)    Is retirement out of reach? (2)    Evaluating your “Retirement Readiness” (3)    An offer from KCS that you can’t (or at least shouldn’t) refuse Back in 2000, with the stock market at historic highs, both […]

The Post-Election Correction

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On November 6, President Obama was re-elected for 4 more years. On November 7, the S&P 500 fell -2.3% and has continued to fall since; it is now down -4.6% since Election Day. Overseas markets have fared somewhat better, as the MSCI All-Country World ex-US index is down only -3.3% over the same period. What […]

Are you a Non-Investor?

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A significant number of people (perhaps you are among them) don’t invest their savings, instead keeping their money in cash or bank CDs. These people share certain feelings about investing and the market that explain why they choose not to invest. In most cases of non-investing, the individual chooses “peace of mind” over wealth enhancement. […]

Debt and Taxes, Part 1

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Greece is again in the news, finally passing reforms that will probably enable them to receive the second round of bailout funds. Although they gave in to most of the IMF’s and the Eurozone’s (i.e., Germany’s) demands, even after this round of funding, it won’t be the end of the crisis for Greece or the […]

Giuoco Piano? Not any more!

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I thought I should write a quick note after today’s global market swoon. Forget Greece; it’s now all about Italy. And I’m tired of hearing about (and writing about) Europe. But the good news is that the endgame is likely to be very near. Those of you who play chess will recognize “giuoco piano” as […]

Stop Making Sense

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Another day, another crazy market. We’ve had moves of plus or minus 3% on 7 of the last 11 trading days. This doesn’t happen very often; in fact, we’ve only seen this about a dozen times in the past 100 years. So you’re not imagining it: the stock market has been unusually volatile recently. What […]

Corrections Are Never Pretty

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The process of finding a bottom during a correction is always ugly: big market moves in both directions, hard-won gains wiped out in a flash, individual stocks moving 10% or more in a day (or an hour), and of course, irrational fear all around. (Fear, by the way, is always irrational.) Investors, being human, just […]