Tag: US stocks

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U.S. Stocks vs. Foreign Stocks

If an investor is inclined to follow the markets they tend to follow one or two U.S. stock market indices. The most common are the S&P 500, Nasdaq and Dow Jones Industrial Average.

However, those incorporate just a minority of the publicly-listed stocks in the U.S. albeit the largest companies. A better proxy for the overall U.S. stock market is the Russell 3000. We also can’t forget to point out that there is still the rest of the world to consider.

The U.S. stock market has dominated foreign stocks since the Great Financial Crisis (see chart below: U.S. stocks in purple, foreign stocks in orange, and global bonds in blue). Continue reading “U.S. Stocks vs. Foreign Stocks”

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The Fed Cuts Rates for a Third Time…And Zombies

Yesterday, the Federal Reserve confirmed the market’s expectations and announced they would be cutting rates for a third time this year. The rate cut is an addition to the recently-announced program of supplying $120 BILLION in liquidity each night AND announcing the resumption of QE whereby they’ll be buying $60 BILLION of short-term Treasurys each month.

In other words, the Fed is pursuing policy that, until the recent Great Financial Crisis, was unprecedented. Why? Why are they pursuing emergency policy actions when the economy is supposedly strong, stock market is near all-time highs, unemployment near all-time lows and inflation supposedly around 2%? Continue reading “The Fed Cuts Rates for a Third Time…And Zombies”