BlackRock

Reflation

Best Blogs of the Week #251

Posted by Anu Heda on Nov 21, 2016, in Best Blogs of the Week , tagged with , ,

Favorite post of the week covers reflation (Act of stimulating the economy by increasing the money supply or by reducing taxes, seeking to bring the economy back up to the long-term trend, following a dip in the business cycle. It is the opposite of disinflation, which seeks to return the economy back down to the long-term trend.) . Less than two weeks since the election and most industry blog posts continue to describe potential changes and situations across regions and asset classes. I tend to like posts with a clear viewpoint on 1 – 2 issues.

BlackRock – Welcome to the new world of reflation – Besides the impact of aggressive fiscal stimulus that President-elect Trump has proposed, inflation expectations are rising on the back of fundamental developments that preceded the election.

BlackRock – What a Trump presidency could mean for bond markets long term – We see a potential headwind for municipal bonds.

Franklin Templeton – A Fresh Look at DOL and Retirement Issues Under Trump – Trump has a very limited, if any, agenda on retirement issues that we can determine. His advisors have been quoted as calling for the repeal of the DOL fiduciary rule, but his populist rhetoric has been largely adversarial toward Wall Street.

Wells Fargo – The investment landscape after the election – After a brief hiccup, I think the market has it right: Trump will be pro-growth. This should be good for stocks and not good for high-quality bonds.

 

Best Blogs of the Week #249

Posted by Anu Heda on Nov 07, 2016, in Best Blogs of the Week , tagged with , ,

Power. A President’s power on the global markets. As we’re one day from selecting (please let there not be a tie) the 45th POTUS, it’s a topic that is on many American minds. The Loomis Sayles post shares market impacts directly tied to Presidential power.

BlackRock – Are International Markets Back? – Very slowly, almost stealthily, international equity markets are clawing back relative to the United States. On a dollar-adjusted basis Japanese stock returns are now on par with the United States, with both the S&P 500 and the Nikkei 225 up around 4.5% year-to-date.

President and price to earnings since 1954

Loomis Sayles – Presidential Power: Are We At Risk for a Trade War? – The president has enormous powers to tear up trade agreements and, in many cases, to impose tariff penalties to advance US interests as interpreted by the president.

SSgA – It’s About Time: Using ‘Satisficing’ to Help Clients Make Better, More Efficient Decisions – For all investors, “satisficing” can be the foundation of a more structured process around investment decisions. Satisficing—which combines satisfying and sufficing, and was coined by behavioral economist Herbert Simon—is a way to manage uncertainties in the decision-making process, to stay focused on goals and to avoid being overwhelmed by unlimited information.

 

3 Practices to Improve Your Firm’s Blog Posts

Posted by Anu Heda on Oct 18, 2016, in Thoughts , tagged with , ,

For the last five years, I’ve tracked the industry’s blog posts and seen tremendous growth. Growth in number of firms, frequency of posts, and quality per post. In the quality dimension, many aspects of individual posts taken for granted now were absent five years ago. For example, these four details were not commonplace:

Authors’ names (many posts were published by “admin” or “asset manager”)

Charts, graphs and data tables (many posts were 500+ words of straight text)

Links to related thought leadership

A clear conclusion

QualityFrom reading hundreds of industry blog posts, I want to share three favorite practices.

  1. Include a “Bottom line.” Too many times, authors post 500+ word entries without a highlighted point of view or logical next step. A bottom line reiterates a single idea to take away.
  2. Add only relevant and simple charts. Many posts include unnecessarily complex charts. Each week, I come across a chart with multiple vertical axes, and data in both line and bar chart form. If the post’s point is so complex it requires such a difficult chart, perhaps a whitepaper is a better format.
  3. Use a precise question as the title. Of the three, this practice is changing the most quickly in 2016. Still, we see posts titled “Q2 Bond Update” or “Views from Asia.” Titles like this often undersell the quality within. Title-as-question is not preferred for all posts, yet many posts could benefit from this format.

I imagine in 5 years’ time these will be commonplace across the industry.

Best Blogs of the Week #247

Posted by Anu Heda on Oct 03, 2016, in Best Blogs of the Week , tagged with ,

Two posts this week featuring investing timeliness from industry titans.

BlackRock – Bonds that have seen the most traffic lately – The first thing that jumps out at me from this Bloomberg data is the continued search for yield.

Vanguard – When the worst of times is the best of times  – To help you explain the challenges of timing the market to clients, we looked at the 20 worst and 20 best days from 1990 through 2015. What we found (see figure below) is that all but one of the worst days were within a month of at least one extreme up day.

 

Timeliness - Vanguard

 

Best Blogs of the Week #246

Posted by Anu Heda on Sep 19, 2016, in Best Blogs of the Week , tagged with ,

Three posts this week to consider, including an interesting retirement income approach via Vanguard.

Hollie Retirement IncomeBlackRock – How investment advisors are changing with the times – How investment advisors are changing with the times – Last year, almost 20% of the surveyed viewed robo advice as a threat to their businesses, while 39% saw robo technology as an opportunity. This year’s study was significantly more optimistic: Only 14% saw robos as a threat, while nearly half saw them as an opportunity.

Chip Retirement IncomeVanguard – Changes to Form 5500: Lessons from the life of a beta fish  – Benchmarking often leads to plan design enhancements that improve participant retirement outcomes. Of course, transparency into any individual plan could also produce an entirely different outcome. For example, the proposal indicates that the IRS and DOL could use the Form 5500 data for targeted enforcement of plans with compliance issues noted on the form. It wouldn’t be surprising for these plans to be subject to future audits.

Colleen Retirement IncomeVanguard – Sustaining retirement income in a lower-return world – Two of the most popular are the “dollar plus inflation” and the “percentage of portfolio” rules. I’d like to offer what I consider an alternate solution: the “dynamic spending” strategy.