Money and Finance
- Steven Romick’s Q3 Letter
At the end of 2011, we believed that economists and Wall Street analysts were generally too optimistic with respect to 2012 expectations. Since then, we’ve been proven correct. United States (and EU) GDP is far lower than expected. The U.S. deficit...
- Goodhaven Semi-annual Report
The Fund’s capital is being deployed judiciously and we still have a chunk of cash – we are optimistic, but cautious. Although our cash position will decrease as we find new and appropriate investments, the world is still a troubled place and we are...
- Hussman Weekly Market Comment: Earning More By Setting Aside Less
Meanwhile, it is notable that the "favorable" earnings reported by J.P. Morgan and Bank of America in the first quarter were due to reduced provisions for credit losses - charges that are largely discretionary. In the fourth quarter of 2009, J.P. Morgan...
- Hussman Weekly Market Comment: Reported Earnings Versus "owner Earnings"
Over the years, I have frequently emphasized that stocks are not a claim on "forward operating earnings." They are not even a claim on reported net earnings (and should not be valued as a blind multiple to a single year's results in any event). They...
- Dividend Growth Checkup
As part of my annual review process for my portfolio, I read through the latest quarterly or annual reports for the companies I own, as well as checked up on the organic dividend growth for each position and for the portfolio as a whole. The dividend...
Money and Finance
FPA Capital Fund's Semi-Annual Report
In light of the above comments, we believe the odds of a 2008 recession have increased to at least 50%, or more. Given the growing credit contraction, oil prices approaching $90 per barrel and the dollar setting new alltime lows versus a basket of currencies; future Fed policy actions may prove rather ineffectual in dealing with these challenges. We are of the opinion that the Fed will lower the Fed Funds rate into the 3.75% to 4% range next year, or lower, as housing, capital markets and consumer issues negatively affect economic and corporate earnings growth. We view consensus earnings growth expectations as being too high and believe that they will have to be lowered. Only recently have various types of financial services companies begun to recognize their problem loans and investments, with charges and provisions for future losses. Some of these stocks have responded favorably, with the belief that these companies are getting their problems behind them. Again, we believe the consensus is being too optimistic. Generally, managements are always initially optimistic, until they have to face the grim reality of the situation, and this process should extend well into 2008. The stock market appears to be ignoring these various risks since there appears to be a general belief that lower interest rates will ride to the rescue to solve these credit problems and support stock prices. We do not agree with this optimistic view and, therefore, we will continue to deploy a highly defensive portfolio strategy since we do not believe we are being appropriately compensated for these risks.
- Steven Romick’s Q3 Letter
At the end of 2011, we believed that economists and Wall Street analysts were generally too optimistic with respect to 2012 expectations. Since then, we’ve been proven correct. United States (and EU) GDP is far lower than expected. The U.S. deficit...
- Goodhaven Semi-annual Report
The Fund’s capital is being deployed judiciously and we still have a chunk of cash – we are optimistic, but cautious. Although our cash position will decrease as we find new and appropriate investments, the world is still a troubled place and we are...
- Hussman Weekly Market Comment: Earning More By Setting Aside Less
Meanwhile, it is notable that the "favorable" earnings reported by J.P. Morgan and Bank of America in the first quarter were due to reduced provisions for credit losses - charges that are largely discretionary. In the fourth quarter of 2009, J.P. Morgan...
- Hussman Weekly Market Comment: Reported Earnings Versus "owner Earnings"
Over the years, I have frequently emphasized that stocks are not a claim on "forward operating earnings." They are not even a claim on reported net earnings (and should not be valued as a blind multiple to a single year's results in any event). They...
- Dividend Growth Checkup
As part of my annual review process for my portfolio, I read through the latest quarterly or annual reports for the companies I own, as well as checked up on the organic dividend growth for each position and for the portfolio as a whole. The dividend...