I was reading a report by the New York Times today, which outlined that Wall Street has earned half of what it earned last year because of massive credit losses. That’s a pretty spectacular fall. What it actually got me thinking about was how one measures P/E ratios.
Only a year ago, Wall Street [...]

Economists have a way of coming up with more ratios and statistics than you can shake a stick at. True to my profession, I have developed a long-term yardstick of market overvaluation and undervaluation. I have no short-hand for it yet so I’ll call it what it is: 10-yr. rolling average S&P 500 [...]

Knowing when to invest is just as important as investing at all. When one analyzes the returns in the market over longer periods (5+ years), it becomes obvious that certain periods of investing are much less lucrative than others. We are living in one of those times.
Since the late 1990s, in the wake [...]

Remember when you used to hear pundits say “‘Buy and Hold,’ that’s the ticket to shareholder wealth?” Is that really true?
I have put this thesis to the test over a number of years and it just doesn’t hold water. Bear markets are always so extreme, they wipe out gains for decades. So, [...]

John Mauldin is an economic pundit I have been following for a number of years. He not only writes a weekly newsletter that is very informative but he also has many guest writers of equal note. Yesterday, he had Michael Levitt of HCM write for him and what he said about the U.S. [...]

Royal Bank of Canada joins the list of financial institutions sued by clients over the large losses associated with the credit crisis.
The Globe & Mail reports:
Royal Bank of Canada has been hit with a proposed class action lawsuit in New York alleging that it told clients that auction rate securities were safe short-term investments for [...]

This past week, I attended an Investment luncheon to hear Greg Valliere, the chief political strategist with the Stanford Washington Research Group. He had a number of important things to say regarding the economic implications of political decision-making in Washington and of this year’s U.S. presidential election. I agree with most of his [...]

As the downturn takes hold in the U.S., the obvious dilemma for investors is knowing which sectors to avoid. Financial stocks are a sector obviously fraught with risk as they have already sustained enormous losses with many more to come as the downturn takes hold. However, on the other hand, Doug Kass, a famous [...]

I f anyone doubted it, China’s bubble has finally popped. The Shanghai Composite Index is down 50% from its highs in 2007. That is a massive downswing that must have broader consequences. Moreover, this is likely the result of a realization that Chinese equities were overvalued in a world where the U.S. [...]

Today, as I write this blog entry, the U.S. Economy is in crisis. We have a massive consumer and mortgage debt problem. Gasoline and food prices are going through the roof. The U.S. dollar is plunging. People are losing their jobs and their homes. All of this is pretty nasty stuff. How do [...]