By Bob Landaas
None of us have any experience in navigating the waters in the financial markets after the Fed has quadrupled its balance sheet. None of us have gone through tapering. There’s nothing that I can point to that says the last five times I dealt with this, here were the ramifications, and here is the best strategy that we were able to discern.
But let’s consider expectations.

Severe weather, China’s slowdown and Fed tapering contributed to a choppy beginning to 2014. But Bob Landaas cites some reasons for midyear investor optimism. Among them: Low inflation and high profitability.
“What I’m so attracted to right now is profit margins. They’re the highest they’ve ever been,” Bob says in a MONEY TALK VIDEO. “That’s borderline rare, halfway through a business cycle for margins to stay so high.”

By Bob Landaas
Either the bond market is wrong or the stock market is wrong.
When the Fed finally got around to tapering in December, bonds rallied. Typically, bonds rally when it’s perceived that economic growth is decelerating, when people feel the future isn’t good so they go into fixed income.
On the other hand, the Dow has held its own so far this year. The Nasdaq is up. The S&P has advanced 4% through May.
Usually, one is wrong. My guess is that the bond market is wrong. It didn’t know how to react to tapering.

By some signs, the U.S. economy may be emerging from its winter nap. But earnings and interest rates will determine to what degree financial markets experience a spring awakening, Bob Landaas explains in a MONEY TALK VIDEO.

By Bob Landaas
For most bond investors, 2013 was a disappointing year. The bond sell-off started in May, after the Federal Reserve announced its intention to taper or reduce its bond buying as early as September. Ironically, when tapering finally started, in December, bonds started to rally. And for the new year, bonds are well on their way to recovering their losses of 2013.

By Bob Landaas
Let’s talk about the contagion that’s spreading in the emerging markets. We’ve seen the currencies in Turkey, South Africa and Argentina among others getting clobbered.
Two things set it off. One was a report showing Chinese manufacturing had contracted for the first time in six months. A lot of these emerging markets transport raw materials to China. The orders are slowing down. As a result, the emerging markets are struggling.

Record high prices in stock market indexes do not necessarily signal that stocks have hit their peak. In a MONEY TALK VIDEO recorded Dec. 2, 2013, Bob Landaas and Brian Kilb discuss other considerations in determining the potential for stocks as investments. […]

By Bob Landaas
It amazes me what some professional money managers think is appropriate advice.
I met a woman who had a fair amount of money with a manager who was convinced for the better part of the past two years that the market was going to crash. This guy had all of her money in short-term bonds.
She had a brokerage account at another place where 60% of the money was just in oil stocks.
Now, I understand that there are a lot of ways to bake lasagna or cook chili. Everybody’s got a different recipe. But there’s really only one way to manage money.

By Bob Landaas
I had a client recently talk about the deficit. He was worried, thinking that it’s going to bury the country. You can get 20 economists and money managers and analysts in a room, and the deficit won’t even come up in conversation. But I get asked this constantly.
First, the deficit is actually coming down right now – maybe not as fast as people would like. Studies show that it’s going to keep coming down for each of the next five years, assuming interest rates remain somewhat steady.
Experts think that 2023 is the watershed year. That’s the year when the majority of the boomers will be in retirement, eating up dollars from Medicare and Social Security, and our country is going to have to make some changes.
It is a solvable problem. And people need to act like it is a solvable problem.

By Bob Landaas
“New normal” did not last long. During and just after the financial crisis, developing nations tended to do better than developed nations. Many developing nations avoided a real estate bubble and collapse and a banking crisis. Those countries had surpluses and citizens without large debts. The notion of a “new normal” for investors predicted that the emerging economies would lead the world in economic growth into the future. Well, the future lasted five years.

By Bob Landaas
I got a question from a client on a somewhat obscure technical indicator called the Hindenburg Omen. I want to use this as an opportunity to talk about the difference between technical and fundamental analysis and to weigh in on the difference and talk about what we like. Most people who manage money professionally look at fundamental analysis. We care about economics. We care about earnings from companies. We care about political trends. We care about money policy, and we care about the global economy.

By Bob Landaas
More than halfway through the year, the domestic stock market has enjoyed a wonderful rally with stock prices up more than 18% through the end of July. Earnings for the second quarter are set to establish yet another new record while projections for year-end remain encouraging.