AAM Live Blog

The Market’s Ultimate Upside Could Prove Legendary - Peroni Report May 2013

Mon, 20 May 2013 19:32:21 Z

Not even half way into the second quarter the DJIA has exceeded my year-end forecast (15,100). The natural inclination may be to cite this as evidence of a market that has run fast and furious to perilously extended levels.

Market High? Don’t Bet On It.

Fri, 17 May 2013 18:07:03 Z

10 Reasons Why the Bull Still Has Room to Run: The equity markets have had a stellar run. But as we move into summer, anxiety levels are rising right along with the temperature. The “C word” – correction – is creeping into more headlines.

Guide to Working with Monetary Napalm

Fri, 10 May 2013 19:08:32 Z

In the world of financial incendiaries, the Fed’s overwhelming monetary stimulus has ignited asset prices in the United States with the force and effectiveness of napalm.

The Psychology of the Markets: 2000 Years & Going Strong

Fri, 10 May 2013 16:21:39 Z

In the constant bombardment of anxiety-riddled headlines, we are always on guard to determine that which is fundamental risk and that which exacerbated to justify our sentiments at the current time.

May Day for the Markets…Potentially Not?

Mon, 29 Apr 2013 19:20:01 Z

As we approach May 1, aka May Day for the bearish pundits, we begin the process of seeing the “Sell in May” crowd show up. This phenomenon, which we wrote about last year, has had a more convincing run over the last several years and has seemed to become a self-fulfilling prophecy.

Municipal Bonds Run the Gauntlet and Emerge Intact

Tue, 23 Apr 2013 14:27:35 Z

Municipal bond investors are entitled to take a breath and regroup. The past four months have presented a series of deadlines and seasonal challenges that had the potential to heighten overall market uncertainty and negatively impact municipal bond values. A litany of do-or-die dates tied to the fiscal cliff, the debt ceiling, sequestration, and the continuing budget resolution have come and gone.

Pay Attention to Chinese Equity Market

Thu, 18 Apr 2013 18:58:14 Z

Yesterday we had an update from the Chinese State Council on its near-term policy focal points. There were five points of focus:

A Pause That Refreshes – Peroni Report April 2013

Tue, 16 Apr 2013 20:22:59 Z

Basking in the glow of a series of record-high feats and with the seasonal benefit of April - historically one of the best months of the year for stocks - the equity market has seemed unstoppable.

All That Glitters Is Not Gold

Mon, 15 Apr 2013 17:45:15 Z

This quote from Shakespeare’s Merchant of Venice is apropos given the nosedive in the gold markets today. In our 2013 Best Ideas piece we labeled gold a neutral as gold had not had a significant correction since 2008.

The Cyclical Opportunities in Secular Bond Bear Markets

Tue, 02 Apr 2013 19:33:37 Z

The changing macro environment of the U.S. economy over the last 60 years has created a current state where we are still benchmarking past anomalies with current potential results. To simplify this, we still have extreme events of the 1970s and early 1980s as the potential for interest rate and inflationary shocks, though those have been shown to be anomalies.

Why Would Anyone Pay a Premium for a Bond?

Thu, 21 Mar 2013 21:19:01 Z

Many investors simply can’t justify purchasing a bond for more than its principal amount. They believe that buying a bond at its original price (par) or at a discount (paying less than par value) is always the best “deal.” However, in some instances, buying a bond at a premium (or paying more than ...

Cyprus Confiscation the Catalyst?

Mon, 18 Mar 2013 15:56:12 Z

People woke up to one of the more creatively destructive “taxes” we’ve seen in the modern economic era. However, the idiocy of the idea doesn’t just lay at the surface level, its culprits and enablers goes deeper.

The Dow Marches On - Peroni Report March 2013

Mon, 18 Mar 2013 15:43:55 Z

The stock market has demonstrated tireless resiliency in the face of challenging headline news and geopolitical events since its bottom in March 2009. Now, some four years later, the burden of some of these once gripping issues has been lifted.

A Broader View on U.S. Inflation Concerns

Fri, 15 Mar 2013 19:51:33 Z

Taking a broader look at today’s economic releases is a daily task that more often than not results in trend confirmation. Today’s release of capacity utilization along with consumer inflation data allows one to look at the more traditional correlation between these two measurements.

Waiting on Weakness?

Wed, 13 Mar 2013 14:57:05 Z

On Tuesday, March 5, The Dow Jones Industrial Average (DJIA) set a new record close at a level of 14,253.8 (old record of 14,164.5 was set on 10/09/07). Since then it has gone on to set four more consecutive record-closing highs.

Banking on the Banks

Tue, 12 Mar 2013 18:29:38 Z

Last week’s stress test results detailed the continued balance sheet strengthening where 17 of 18 banks passed. The only bank that didn’t was Ally bank

Corporate Bonds - Why You Can Still be Comfortable Buying Them in Today's Market

Wed, 27 Feb 2013 21:28:40 Z

Corporate bonds are very strong overall, with easy access to capital markets at great rates, lots of cash on the balance sheet, and good earnings/ stock prices.

Overbought? Not seriously. - Peroni Report February 2013

Tue, 19 Feb 2013 21:04:32 Z

With the DJIA having reached 14,000, calls for a correction have become more frequent. The media has amplified traders’ concerns about an overbought market that is seemingly overdue for a setback.

Will the Dollar Rise as Developed World Currencies Devalue?

Tue, 19 Feb 2013 14:34:01 Z

The devaluation of developed world currencies is proceeding on schedule. Japan recently elected a new Prime Minister, Shinto Abe, whose platform is based largely on a plan to devalue the yen.

May the Farce Be With You: A View from the Front of the Currency Wars

Mon, 11 Feb 2013 20:26:54 Z

There has been an elevated amount of chatter recently that there is a resurgence of countries engaging in competitive devaluation of their currencies. In the past month, we have seen the new Japanese government pressuring the Japanese Central Bank (JCB) to engage in asset purchases with the intent of weakening the yen against the dollar.

Junk Does a Swan Dive

Thu, 07 Feb 2013 21:57:09 Z

One of the best-performing asset classes of 2012 was the High Yield (HY) aka “Junk Bond” market. The HY market, as measured by the Barclays High Yield Index returned a cool 15.81% last year.

Global Central Banks and Their Corresponding High Tide

Tue, 05 Feb 2013 18:09:08 Z

January saw some of the more profound equity returns in the beginning of the year than has been seen in years. The phenomenon cannot be just explained as congruency of positive economic developments.

Dividend Growth Continues to Impress

Mon, 04 Feb 2013 16:10:28 Z

The S&P 500 posted a very solid price appreciation of 5.14% (total return of 5.18%) for the month of January which marks its best January since logging a total return of 6.25% in January 1997 (16 years).

Artistic Analysis is the Key to Reducing Headline Risk

Thu, 31 Jan 2013 16:50:08 Z

The reports about the economy over the last two days are a not-so-gentle reminder about the dangers headlines can be when assessing the economy. As was very clear yesterday, the negative GDP print was severely skewed by defense spending and a lack of inventory building.

Don’t Give Up on Dividends

Thu, 24 Jan 2013 16:04:25 Z

After yet another narrowly averted fiscal crisis in the United States, a host of tax changes are slated to take effect in 2013. We think this makes a discussion of dividends and taxes all the more relevant.