If you’ve been following the news, you’ve undoubtedly learned that President Trump has been attempting to negotiate a new trade agreement with China. He has adopted tariffs as his primary tactic to force China to agree to terms he believes are favorable to the United States. However, China has responded in like fashion and both […]
How to Win a Nobel Prize, Part I
Are you ready for a graduate level discussion on investing, and how to build a portfolio? We promise to keep the jargon to a minimum, and to explain academic terms, if we can’t avoid using them. At Springwater, our approach to building investment portfolios for our clients is based on decades of academic research. That […]
Market Recovery … and Recession?
The first quarter of 2019 has ended and investors are breathing easier. After a bruising fourth quarter 2018 in which investors experienced double digit losses in the stock portions of their portfolios (the Dow Jones Industrial Average was down 11.3%, the S&P 500 Index lost 13.5% and the tech-heavy Nasdaq dropped 17.5%), the markets bounced […]
Mild inflation has returned
After attempting for several years to coax inflation back up to 2% in the US economy, the Federal Reserve has finally succeeded. The Commerce Department reported last Friday that consumer prices were 2.3% higher in May than they were the year before. Core inflation, which ignores food and energy prices, was up 2% year over […]
The Administration Roils the Stock Market
Economists tell us that there are a few things that can derail a strong economy. The government can raise taxes. The central bank (i.e. Federal Reserve) can raise interest rates. Prices can jump (i.e. inflation). War can break out. The U.S. economy has been performing very well for the past several quarters. Inflation is low. […]
Ladies and Gentlemen – Please Fasten Your Seatbelts
“LADIES AND GENTLEMEN – PLEASE FASTEN YOUR SEATBELTS” If you have every flown with a commercial airline, you have undoubtedly heard these words. This message is broadcast whenever the plane has encountered turbulence and there is resulting concern about the safety of the passengers and crew. After last week’s performance of the stock market, investors […]
How do the House and Senate tax reform proposals compare?
Last week we provided an overview of the House tax reform proposal. Later in the week the Senate released its version of the legislation. Below we add comments to our blog post last week and indicate the Senate’s proposal. We have highlighted the Senate version when it differs from that of the House. Income Tax […]
What’s in the administration’s tax reform proposal?
Last week, the Trump administration outlined its proposals for tax reform. Entitled the “Unified Framework for Fixing Our Broken Tax Code”, the proposals, if enacted, would result in the most significant changes to the tax code in 30 years. Reduction in the number of brackets For individuals, the proposal would reduce the number of tax […]
Is the stock market overvalued?
Professional money managers use various tools to measure the value of an investment. One common measure is the Price/Earnings ratio. To get a P/E ratio, take the price of a stock and divide it by its earnings. We will use Facebook. The closing price for FB (its ticker symbol) on Friday was $172.45 and its […]
A Market Update – March 28, 2017
The US stock market, as measured by the Dow Jones Industrial average, has now experienced six consecutive days of losses. This has not happened since 2011. The markets may be questioning whether the new administration will be able to execute on plans that include tax reform, reduced governmental regulation, better trade arrangements and fiscal stimulus. […]