COVID-10 Diary Number 7 (July 8, 2020)

Would negative interest rates help the economy recover from anti-virus strictures and propel the stock market rally?  President Donald Trump seems to think so.  He has publicly pressured Federal Reserve Board (Fed) Chairman Jay Powell to pursue just such a policy, saying that the country deserves the “gift” of below-zero interest rates.  Though the Fed …

COVID-19 Diary Number 6 (May 30, 2020)

I started these “COVID-19 Diary” posts on April 1, shortly after the quarantines and lockdowns began.  Much has happened since then, including five posts trying to explain events as they occurred.  Now that those strictures are beginning to lift, it seems appropriate that this sixth post remind readers why things unfolded as they did. At …

Covid-19 Diary Number 5 (May 26, 2020)

The Labor Department’s jobs report for April offered official confirmation of what we already knew: the U.S. economy is in deep trouble. Though this collection of data is the worst since the Labor Department began this statistical series in 1957, the official report probably understated the extent of the economy’s troubles.  It showed that the …

COVID-19 Diary Number 4 (May 5, 2020)

The president and several governors have begun considering, and in some cases beginning to end, the worst of the lockdowns and quarantines in the effort to reopen the economy.  It is none too soon.  As readers of this site know, the strictures to “flatten the curve” of infections and hospitalizations threaten economic collapse.  Dr. Anthony …

COVID-19 Diary Number 3 (April 20, 2020)

The unemployment rate reported by the Labor Department for March understates, by a long shot, the nation’s economic pain.  According to the official report, non-farm payrolls last month fell 701,000 and the rate of unemployment rose from 3.5 percent in February to 4.4 percent. The actual figure is that closed businesses and quarantines likely reduced payrolls …

COVID-19 Diary Number 2 (April 6, 2020)

Though no one can yet say how the virus will continue to develop in the U.S., and therefore how the markets will go, a review of the past few weeks can allow this conclusion (with apologies to Winston Churchill at the end of the Battle of Britain): This is not the end or even the …

COVID-19 Diary – Number 1 (April 1, 2020)

A reader suggested that while this pandemic continues, I keep an open diary on this site with frequent short entries focusing (though not exclusively) on investment and the markets. This is the first of these posts. Markets are less concerned about the virus itself than with the recessionary impact of the lockdowns and quarantines.  That perspective …

The Computer’s Role in the Recent Wild Market Swings

Computerized stock trading has played a not-insignificant role in recent violent stock market swings.  Of course, behind these swings are the perennial drivers of market lurches: fear and greed.  Fear rules whenever investors feel insecure or uncertain, but it’s greed’s turn when investors judge that the fear has created a buying opportunity that despite uncertainty …

Market Panic Over the Coronavirus

As of this writing, markets have fallen more than 10 percent from their highs, almost entirely in a panic over the coronavirus.  It seems the American public has also shown signs of panic. Emergency food packs have disappeared from store shelves and some towns have objected to sick people getting treatment locally.  While some investors are …

A Question of Objectives and Asset Allocation

I recently received a question accompanied by an interesting description of an asset allocation debate.  It gets to the nub of several investment principles underlying Bite-Sized Investing.  To put my response in perspective, I quote  from the communication. “A few years ago, I bought stock for my retirement account in one of the great computer-related …