| News |
| Questions? |
| Services We Offer |
| Newsletter Archive |
|---|
| Things to Sign Up For… |
| Client Log-In |
Quarterly Newsletters
Year End 2011 Summary
The S&P 500 Index closed 2011 at almost the exact level that it began the year. In March, markets were initially jolted by the Japanese earthquake and tsunami, but then began to recover as the damaged reactors came under control. However, the dysfunctional political process in the U.S. regarding the budget and debt ceiling in July led to a downgrade of U.S. debt and an almost 20% decline in stock prices. At the same time, the sovereign debt crisis in Europe caused fears of a Lehman-type crisis in which the default of sovereign debt could spread from country to country as well as cause defaults of European banks. When the market bottomed on October 4, many investors believed that another deep global recession was on the horizon.
Full text…
Third Quarter 2011 Summary
Tough quarter. Very tough. The debt ceiling debate of July seems like a lifetime ago as the two months following experienced the first ever S&P downgrade on United States debt, followed by downgrades to most US banks. Next we witnessed the Europeans flail about trying to save the current structure of the European Union and in the next several weeks I suspect we'll finally see the much feared Greek default.
Full text…
Second Quarter 2011 Summary
I struggled with writing this letter. I considered writing about the European debt crisis and why it matters to the United States. I thought about pointing out the exceptional health of American corporations and my belief that if the Government would just get out of the way we could recover quite nicely. QE3? No thanks! No matter what I wrote I came to the same conclusion; here we are in the sideways grind I've discussed quarter after quarter over the past year. During the second quarter 2011 we suffered a period of 7 negative weeks out of 8, then in the last 4 days of the quarter we made up most losses from the previous 11 weeks. This volatility and sideways movement is here to stay.
Full text…
First Quarter 2011 Summary
The first quarter of 2011 kicked off the year almost exactly as we expected. The market went basically straight up from January 1st until February 18th, straight down from February 18th to March 16th then straight up until the end of the quarter. This exceptional volatility will remain for years to come as investors try to figure out the impact of our government’s kamikaze like economic policies. The good news: Bernanke sees no inflation. I’ll pause here so everyone can enjoy a chuckle.
Full text…
Year End 2010 Summary
The tax deal between the White House and Republicans passed by Congress mid-December is a big deal for the recovery. Most economists agree there is enough new stimulus in the package to add somewhere between 0.5 and 1 percentage point to economic growth in 2011, significantly reducing the likelihood of a double dip recession. That extra oomph could be a game changer. Economists believe it will give the economy enough power to create jobs at a pace sufficient to make a meaningful dent in the unemployment rate and assure a self-sustaining recovery.
Full text…
Third Quarter 2010 Summary
Early in the third quarter all the talk was about how the Federal Reserve needed to aggressively fight deflation and that no inflation was on the horizon. While there are signs of deflation especially in the housing market, the real problem out there seems to be inflation. Most indicators are stealthily flashing a warning that inflation is just around the corner—if it is not already here.
Full text…
Second Quarter 2010 Summary
The double dip in housing and dramatically lower consumer confidence arrived the last week of June. This may or may not be a template for the economy as a whole but at the very least is a precursor of other serious disappointment destined to feed the unease among investors. There is little doubt the best case scenario is a multi-year grind sideways. But becoming ever more likely, a double dip recession arrives by first quarter 2011.
Full text…
First Quarter 2010 Summary
Government stimulus is good for only so long. Eventually, business and consumer demand must take over and drive the United States economy which will provide the necessary base for sustained stock market health. Although small business and the consumer remain focused on paying down debt and building sufficient cash reserves for expected rainy days, we are at an economic inflection point. The question to be answered over the next six months: Can the private sector economy get up off the floor and stand without the assistance of Uncle Sam?
Full text…
Year End 2009 Summary
I enjoyed a couple days off during the holiday and spent a little time watching a show about sharks on the discovery channel. Bump-and-bite shark attacks occur when a shark actually thinks of someone as an intruder. The shark circles, then comes in to bump the victim, usually several times, before finally attacking. Often the victim feels the bump but does not recognize the bump is from a shark and as such fails to recognize the pending danger. Bump-and-bite attacks often occur in shallow waters near shore giving the victim time to get out of the water, call for help or for the more adventurous, punch the shark in the nose. Repeat bumps are common before attacks which result in the most serious of shark attack injuries. The bump-and bite shark attack results in more fatalities then any other type of shark attacks yet could often be escaped if the individual recognizes the danger posed by the bump. Point being, don’t ignore the bumps.
Full text…
Third Quarter 2009 Summary
Mike Harding writes: “Clearly, the market with its recent bull run has priced in an economic recovery. But even with all the liquidity and stimulus, the underlying economy has not shown the type of dramatic improvement one would expect if simply watching the stock market alone. Further, it’s not at all unusual to see an up tick in GDP during the midst of a recession. Each of the past six recessions has seen a rise by GDP in at least one quarter, only to see it sink back under water the next quarter.”
Full text…
Second Quarter 2009 Summary
Mike Harding writes: “A bullish case can be made for 1% to 1.5% growth and 3%-4% inflation over the next year but that does not justify a 40% increase in stock price from the bottom… The good news? We are now able to discuss an economic recovery, albeit a slow one.”
Full text…
First Quarter 2009 Summary
Michael Harding cautiously celebrated the rally enjoyed during March suggesting the rally “has some legs” while warning “bottoming is a process not an event”. Michael suggests short dollar and short Treasury positions will be top performers in the following 12-18 months.
Full text…
Year End 2008 Summary
Michael Harding reviews 2008, predicts 10% unemployment by year end 2009 and discusses three economic markers that could signal a pending positive turnaround in the markets.
Full text…
Third Quarter 2008 Summary
Michael Harding writes:, “Fear not! Congress has come to our aid with a 3 page “rescue” plan. Wait, make it 110 pages. Just a second, the final bill has arrived freshly passed by the Senate…In any recognizable form, the bailout is not the magic potion that’ll overnight make housing whole, revive the frozen credit system, spark sagging capital expenditure, revive disappearing consumer confidence, reverse the upward spiral in joblessness…”
Full text…
Second Quarter 2008 Summary
Michael Harding encouraged investors not to get too eager to predict market bottoms and discussed trimming his oil positions. Those positions, established around $70 per barrel, were now trading around $140.00. He also took the rare step of removing a mutual fund from his entire book of business. The Vanguard Wellington fund continued to hold a large share of General Electric and Bank of America making the fund unsuitable for Michael’s clients. GE, B of A declined by over 80% during the following 6 months.
Full text…
First Quarter 2008 Summary
The Federal Reserve, Bear Sterns and market bottoms were the topics of this letter. Michael warned market bottoms are rarely one or two month events and suggested cash would be the best place for investment for the remainder of 2008. Those with cash did very well for the remainder of 2008.
Full text…
Year End 2007 Summary
While many analysts expected the strength of the American consumer to pull the U.S. through what appeared to be a minor economic slowdown, Michael Harding accurately declared the bull market dead and predicted unprecedented liquidity would be required to be provided by the Federal Government.
Full text…
Mid Year 2007 Summary
June 2007 was only the second negative month during the preceding 13 months. While many were caught up in the frenzy of the bull market, Michael Harding believed the end was near encouraging investors to become more conservative and increase exposure to then $70 per barrel oil.
Full text…
| * Note: You will need the free Adobe Reader software to view/print PDF files. Click the “Get Adobe Reader” icon to begin the download process. |  |