Found 17 Articles.
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Some professors at Harvard concluded that it is possible to anticipate which of those rises in stock market sectors will burst and lead to a crash. After studying a lot of bubbles and crashes and running the data through computers, they concluded that there are common characteristics in stock market crashes. Even so, their tools […]
Stock values and many other asset values are too high, says Cliff Asness of AQR, a money management firm. But that doesn’t mean it is time to sell and hide in cash. Many assets values have been high for a long time. But high values alone don’t mean a decline is imminent. Asset prices could […]
This is another long one from The Philosophical Economist, but it is worth the time. The basic argument is that people generally misunderstand why stocks declined so much in 1929 and also why they fell in 2008. The writer believes that it wasn’t valuations, and that’s an important lesson for today when many people point […]
Here’s an interesting exercise demonstrating that you’d be better off if stock indexes were to crash by 66% than if they increase by 200% and then hold that final value. There are a couple of assumptions to consider before hoping that the market will crash. One assumption is that your retirement is 30 years away. […]
Barron’s drew a lot of attention over the weekend for its interview with Ned Davis. (Subscription might be required.) The highly-respected researcher said he anticipates a 20% correction coming in U.S. stocks. But his forecast isn’t as bad as the headline indicated. First, he doesn’t expect a long, deep bear market. He thinks when the […]
One of the better interviews with Eugene Fama, promoter of the efficient market theory and co-winner of the 2013 Nobel Prize in Economics, recently was in Fortune. It does a good job of tracking Fama’s thinking and how it changed over the years. As Fama says, a lot of people misrepresent his work and think […]
You remember the flash crash. That’s the day in May 2010 when the Dow suddenly declined about 1000 points. The Washington Post recently ran an excerpt from a book that describes how the world’s central bankers acted behind the scenes during that period. The headline says it was “Three days that saved the world financial […]
A few days ago I linked to a chart from the Federal Reserve Bank of St. Louis that attempts to forecast recessions. The post I linked to asserted that the chart now indicates we have a 100% chance of a recession based on how the chart today compares with past performance. But it turns out […]