Rebalancing Act

Institutions — mutual funds, pensions, insurance companies, corporations, sovereign wealth funds — often represent smarter money. Indeed, stock prices tend to rise when institutional buying is robust. However, history has been less kind to mom-n-pop...

Scratching the Bubble’s Surface

There is a belief on Wall Street that future corporate earnings can only grow in an environment where borrowing is so cheap. Indeed, inflation-adjusted interest rates (a.k.a. “real rates”) are negative, and that means companies are effectively being paid...

So Few Protective Puts, So Many Aggressive Calls

There have been a number of stock bubbles in history. Yet few rival the infamy associated with 1929’s epic crash or 2000’s tech wreck. Perhaps ironically, today’s post-pandemic bubble may be more egregious. For example, an average of four measures...

How a Market Pullback Can Become a Panic

Healthy corporations have manageable debt levels, rising revenue and increasing profits. Less healthy companies? Sales stagnate, earnings diminish and debt loads explode higher. Even before the pandemic, there were signs of corporate stress. Debts relative to gross...

A Penny for Your Thoughts

There has never been a larger wave of equity inflows. In other words, everybody wants in the stock pool. And not just the largest companies with the strongest balance sheets. Volume for the least viable, most aggressive stock assets — penny stocks — has...