The H Group Blog

Investment and Financial Planning news from some of the best in the business.

Question of the Week - August 15, 2016

Guest Post - Monday, August 15, 2016

What has caused LIBOR to move up so sharply?

As a refresher, LIBOR stands for the London Interbank Offered Rate, which is a benchmark rate for very short-term and variable rate corporate and other loans—including such things as some U.S. mortgages. These short corporate loans are often referred to as commercial paper. Because of their short maturities and decent rates (compared to government securities, because of their embedded credit spreads) they've been popular for decades as core holdings for money market funds, where principal stability, yield, liquidity and a short maturity are key characteristics. For lenders, mostly banks and other financial/industrial firms, these offer a convenient way to manage day-to-day cash flow needs in a cost-effective manner without having to disrupt other balance sheet assets. Because of the high quality of issuers and appetite of investors to earn a higher yield over bank deposits, there had been a healthy balance that created a robust market for such paper—with money funds leading the way.

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Should you Buy a Timeshare?

Brenna Baucum - Tuesday, August 09, 2016

Should you buy a timeshare?  The answer is not black or white, as explained in the July issue of Financial Planning Magazine, which quoted our own Ron Kelemen from our Salem office.  As Ron noted in the article, “Timeshares are not investments.  Rather, they are lifestyle purchases. Therefore, a good deal for a given client could depend upon location, flexibility, liquidity, the ability to use the time at other locations, how well it suits one’s vacation patterns and preferences and a price that’s better than comparable units.”  For a more expanded version of our thoughts on the topic, here is an article Ron wrote for Forbes.com in 2014. Read Entire Article Here

Weekly Review - August 8, 2016

Guest Post - Monday, August 08, 2016

Summary

Economic data for the week was highlighted by weaker than expected but still-expansionary ISM manufacturing and non-manufacturing reports, while the July employment situation report was much stronger than anticipated, pleasing investment markets.

Equity markets were higher in the U.S. and somewhat mixed globally. Government bonds declined with interest rates moving higher, with the exception of a high yield corporate, which gained. Commodities were mixed with oil little changed on the week on net.

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Weekly Review - August 1, 2016

Guest Post - Monday, August 01, 2016

Summary

Economic data for the week was highlighted by no policy action at the FOMC meeting, while GDP for Q2 underwhelmed compared to expectations. Housing numbers were relatively good with home sales reaching pre-recession levels.

U.S. equity markets were mixed, and were outperformed by foreign developed stock indexes which benefitted from a weaker dollar for the week. Bonds generally gained some ground with lower interest rates. Commodities fell as the price of crude oil fell to 3-month lows based on stronger inventories.

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Fed Note

Ryan Long - Wednesday, July 27, 2016

The July FOMC meeting came and went with no action.  This was of no surprise to investment markets, which didn’t expect anything.  Since there were no updated projections and no planned press conference, it implied the meeting was not going to be an ‘important’ one requiring additional clarification and Q&A with the press.   Read Entire Article Here

Weekly Review - July 25, 2016

Guest Post - Monday, July 25, 2016

Summary

In a slow week for economic news, home sales and housing starts surprised on the upside, while the index of leading economic indicators has shown some flattening of momentum as of late.

Stocks gained for the fourth straight week, as a flurry of earnings reports came in better than expected, with U.S. equities outperforming foreign due to a strengthening of the dollar. Bonds ended up with generally tempered returns, as interest rate volatility calmed down from prior weeks. Commodity prices slipped across the board, with oil ticking down a few dollars upon higher inventories.

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Weekly Review - July 18, 2016

Guest Post - Monday, July 18, 2016

Summary

Economic data for the week was fairly positive, with improvements in retail sales, industrial production and jobless claims. Inflation ticked a bit higher due to housing costs and energy, while manufacturing remained mixed.

Global equity markets gained ground on the week, with foreign stocks outperforming those in the U.S., particular in emerging markets. Bond prices fell back on the week as interest rates rose. Commodity prices were slightly higher as oil and industrial metals ticked upward.

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Question of the Week - July 11, 2016

Guest Post - Monday, July 11, 2016

Stock and bond markets seem to be flashing different signals about the economy. How should we interpret this?

While both stocks and bonds often have predictable reactions to geopolitical events and economic data, there are also some unique drivers. A period of very low interest rates has caused some unusual dynamics to occur, but the results aren't entirely surprising considering their sources.

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Weekly Review - July 11, 2016

Guest Post - Monday, July 11, 2016

Summary

Economic data for the week took a turn for the better, with strong results from non-manufacturing ISM as well as an improved employment situation report on Friday.

Equity markets in the U.S. gained as Brexit returns were tempered by the stronger jobs report, but foreign stocks struggled. Bonds rallied globally with interest rates falling to low if not record-low levels in many locations. Crude oil prices fell backward with shorter-term supply disruption concerns fading and production rising again.

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Weekly Review - July 5, 2016

Guest Post - Tuesday, July 05, 2016

Summary

Economic data for the week was highlighted by stronger manufacturing results in the ISM and Chicago PMI surveys and higher consumer confidence, while real estate activity was mixed—a combination of higher home prices but weaker building activity for the prior month.

Investment markets recovered sharply following the 'Brexit' surprise last week, with equities higher globally. Interestingly, bonds also fared well with bond yields falling on net for the week in both developed and emerging markets. Commodity prices, including crude oil, generally showed continued strength during the week.

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