Something seems off about the latest numbers so let’s take a deeper look.   Video Length: 00:04:37

World War II era bomber Source:  CBS asks:    Does gold investing make sense with the price high? Here’s what experts say.  In recent years, gold has caught investors’ eyes, especially since the start of 2024. The price of gold has been on a steady climb and even hit a new all-time high of $2,672 per ounce in September. This surge has pulled in even more investors, fueling further price increases. But now with gold prices at record levels, many are asking: Is it still smart to buy gold? Or should investors wait for a pullback?  The investment pros had the usual answers. Given the risks of war and inflation, most see gold as a ‘safe haven.’ Many expect that it is an ‘investment’ that will pay off. But gold is not an investment. Warren Buffet is right; it will never give an investment return. It has no factories nor sales outlets.  It doesn’t make payroll or a profit. It hasn’t been souped up with AI. It doesn’t do anything… but just sit there.  It doesn’t grow bigger. But it doesn’t shrink either. Its purpose is merely to avoid an investment loss… notably the Big Loss that would knock you out of the game. In the long run, you make money by owning a piece of a profit-making business. The profit represents an actual increase in real wealth. The quintessential example of that was the Philip Morris () company that just kept making smokes… making profits… and distributing money to shareholders. If you had invested $1,000 in Phillip […]

Guest Post By Jason England, Managing Director, Portfolio Manager at Simplify ETFs.  iStockPhoto IntroductionHigh yield bonds are corporate bonds issued by non-investment grade issuers. Typically, these companies’ bonds will offer a meaningful additional return in exchange for the additional risk. While these bonds often have a higher risk of default or impairment, the higher yield has historically been more than enough to compensate investors and generate higher returns than investment grade corporate bonds over an investment cycle. With the Federal Reserve signaling an intention to cut interest rates, now may be an ideal time for investors looking to lock in higher yields for an extended term. High yield investing is popular with investors looking for a high level of income from a bond portfolio. The credit risk in high yield bonds tends to have more volatility and credit spreads can widen swiftly during periods of market stress, wiping out income quickly. Investors in this asset class can accept this risk and size their allocation accordingly or choose to hedge some of the risk to limit the downside when credit spreads widen.  In this Fund Insight, we discuss how deploying credit hedges directly in the portfolio can help protect it when credit spreads widen. The , the first-ever high yield ETF with a credit hedge overlay, is primarily used to generate income. It combines high yield bonds with credit hedge overlays to reduce risk. What Happens When Credit Spreads Widen? After the banking crisis in March 2023, high yield credit spreads widened to […]

Image Source:  In this video I cover my   technical analysis for the Nasdaq and for the week ahead. What is the outlook and setups I am looking to trade. Video Length: 00:03:39

“There is a dynamism about nineteenth-century Europe that far exceeds anything previously known.  Europe vibrated with power as never before: with technical power, economic power, cultural power, intercontinental power.”  —   Europe. (2024, September 24). In Wikipedia.  Rob984, Public domain, via  At the beginning of the 20th century, there were very few signs that this century might become perhaps one of the most tragic in European history. At that time, the economies of Europe’s leading countries were still on top of the world following the Industrial Revolution. Countries like the UK, France, and Portugal sat on top of extraordinary colonial empires. War and Depression From 1914 to 1945, Europe went to war with itself on two occasions and was also torn apart by economic depression.  It would take heroic efforts by the Soviet Union, the US, and the UK to end the Second World War.  But war arguably continued until 1989 through the Cold War, as much of central and eastern Europe was occupied by the Soviet Union as the spoils of war.As Tony Judt analyses in his book , the US played a significant role in ending war and rehabilitating Western Europe. The Marshall Plan significantly contributed to Europe’s economic recovery and culture of cooperation. Most importantly, the Plan lifted Western Europe’s psychological spirits and helped restore hope. This cooperation among European countries laid a foundation for creating the European Union, whose ultimate objective was to ensure that “never again” would there be such wars. The European Union The EU progressively expanded from the six […]

 After a hiatus resulting from various disturbances, I am back with another book manuscript section. I just reworked this section, and hopefully did not introduce major issues into it. However, I wanted to get this out before next week. Right now, my main concern in life is getting my kitchen sink back.This section introduces credit spreads from a bond pricing perspective. Looking at bonds is not completely inappropriate, as banks do hold bonds in their liquidity portfolio. The illiquid loans on bank balance sheets can be analysed in the same way, albeit bankers might use different terminology.A credit spread is the excess interest income an instrument earns when compared to an idealised benchmark security that has no perceived default risk. The “idealised” refers to fact that there may not be a useful benchmark bond to compare to, and so one needs to calculate the yield on a matching bond based on a fitted curve based on traded securities. (For example, a corporate bond may have a maturity of 11 years, and the closest government bond maturities might be at 10 and 12 years, forcing the analyst to interpolate an implied 11-year government bond yield.) The curve used would normally be the central government bonds in sensible developed countries, or possibly a swap curve. Banks would probably use some internal funding cost benchmark for anything other than its bond portfolio. The choice of benchmark is not of critical importance, as the spread is relative to that curve, and we can easily […]