UNPRECEDENTED TIMES

By Gus Krafve

October 3rd, 2008

What we have witnessed in the global financial markets has no real historical precedent in modern times.  A spiral of bad debts, credit downgrades and collapsing equities turned into a full-fledged global market meltdown.  Credit markets seized up, and many........................

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Auction Rate Securities-Another Example of the Investor Losing

By Gus Krafve

September 5th, 2008

As if the current stock market correction and credit crisis weren't enough, there is another slice of the financial markets that has caused angst among some investors.  The market I'm referring to is the Auction Rate Securities (ARS) market.  Many of you reading this piece.............

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Fannie & Freddie: Uncle Sam to the Rescue

By Stephen Smith

August 5th, 2008

Fannie Mae was created during the Depression to make sure that sufficient funds were available to mortgage lenders, and then re-chartered by Congress in 1968 as a public traded company.  Freddie Mac was created by Congress in 1970 and acts similarly to Fannie Mae.  Fannie and Freddie work like this...

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Bears Still in Control

By Gus Krafve

July 7th, 2008

The numbers are in for the first half of 2008, and it will go down as the worst first half since 1970.  Virtually all broad equity indices have posted at or near double-digit negative year-to-date returns...

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Crude Is The Right Word For Oil Prices

By Stephen Smith

June 5th, 2008

Since the beginning of the year, crude oil prices have gone from $87 a barrel to $130 a barrel, a 49% increase!  Gasoline pump prices have shot up to a record high of $3.91 per gallon nationally and are above $4.00 a gallon in many regions.  As oil prices continue their upward march, concerns...........

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Big Picture: Follow the Money

By Gus Krafve

May 6th, 2008

Investors have been selling equities in exceptionally large amounts.  For the third and fourth quarters of 2007, investors sold a net $390 billion.  On the flip side, corporations bought back a similar amount of stock.  The exit from the US market is on par with two previous periods, second quarter 1984 and second quarter 1988...

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The Fed

By Stephen Smith

March 31st, 2008

The Federal Reserve was created when President Woodrow Wilson signed the Federal Reserve Act on December 23, 1913, creating a seven member board of governors, including the Fed chairman, and twelve regional banks.  This structure collectively is known as the...........................

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INVESTOR PESSIMISM NEAR EXTREME LEVELS

By Gus Krafve

February 29th, 2008

The individual investor has not been this bearish since the stock market bottomed in 2002-2003.  The data, according to a recent survey by the American Association of Individual Investors, which has 150,000 members...............

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Historical Look at the S&P 500 During Recessions

By Stephen Smith

February 5th, 2008

With all the talk of a possible recession, it is useful to see how the S&P 500 actually performed during recessionary periods.  Here's a table that shows just that...

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Letter to Clients

By Stephen Smith

January 23rd, 2008

Dear Clients:

There is an adage in the bond market which applies to equities as well, “Quality remains long after the price is forgotten.”

For a lot of investors, even those with quality holdings and a long-term time horizon, the natural human reaction to a precipitous drop in the stock market like we are currently experiencing is to reduce or sell equities, with the hope of stemming future losses. 

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The Prudent Investor

By Gus Krafve

January 18th, 2008

If someone just read the headlines, they probably would have thought 2007 was a bad year for stocks.  Given the turmoil in sub-prime and the credit markets, it was a bad year for certain sectors like Financials and Consumer Discretionary...

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Market Timing

By Stephen Smith

November 26th, 2007

Nothing ignites the fear of losing one's hard-earned investments like a violent, short-term stock market correction. For many investors, even those with a long-time horizon, the natural human reaction to a sudden drop in the stock market is to...

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The Fed Phenomenon

By Stephen Smith

November 6th, 2007

In my last Market Insights, I tried to explain what was happening in the credit markets.  I briefly talked about how the Federal Reserve and central banks globally have pumped massive amounts of liquidity into the system.  These banks allow primary dealers, i.e., large banks and broker dealers to pledge....................................................

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Credit Crisis

By Stephen Smith

August 16th, 2007

I will try to explain what is happening in our financial markets, but it is very difficult to quantify because we still don’t have all the accurate information.

The root of the crisis is years of easy money.  The Federal Reserve and Central Banks around the world have kept interest rates low through the................................

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The Weakened Real Estate Market

By Trust Company Staff

July 2nd, 2007

The first half of 2007 has left us with a lot of nice things to discuss.  The S&P 500 returned 7% through the first half, while the Nasdaq was slightly higher at 7.6%.  An eight week period from April 1 to May 31 made up the majority of the gains...

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The Dow Jones Industrial Average

By Stephen Smith

July 8th, 2007

The press likes to gauge the stock market with the Dow Industrial Average, and I wanted to give some historical perspective to this benchmark.  The Dow is one of the oldest indexes which was created by Dow Jones & Company’s co-founder Charles Dow.  It was first published on May 26, 1896.....

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The Dog Days of Summer

By Trust Company Staff

June 23rd, 2007

After a yawn-filled first quarter, stocks took a page right out of the late 1990s and soared to record highs on many indices.  At one stretch, one had to go back to 1927 to find a percentage comparison of positive trading days in a one-month period...

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First Quarter 2007 Review

By Stephen Smith

May 2nd, 2007

The overall performance of the broad market in the first quarter has been close to historical norms for bonds and below historical norms for equities.

The first quarter forecasted below trend economic growth...

 

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