By Michael Lombardi, MBA | October 15, 2014
Now that the Dow Jones Industrial Average has fallen 1,035 points (six percent) from its mid-September peak, the question investors are asking is “how far will she go?” For small-cap investors, the drama is greater, as the Russell 2000 Index has fallen 12.5% from its July peak.
Since 2009, every market pullback presented investors with an opportunity to get back into stocks at discounted prices. Even some editors here at … Read More
By Michael Lombardi, MBA | September 29, 2014
For the U.S. federal government’s fiscal year, which ends this Tuesday, the Congressional Budget Office (CBO) predicts a budget deficit of $506 billion. (Source: Congressional Budget Office web site, September 26, 2014.)
But just because our annual deficit is declining, that doesn’t mean our national debt is rising by an equal amount.
In fact, between September 20, 2013 and September 20, 2014, the U.S. national debt increased by $1.0 trillion. … Read More
By Michael Lombardi, MBA | September 8, 2014
Oil plays a critical role in economic growth as oil is used in a variety of industries. In times of economic growth, oil prices rise. When the economy is soft, or getting soft, oil prices fall as demand for oil wanes.
Over the past two months, oil prices have collapsed for the simple reason that the global economy is getting weak.
The chart below shows the steep sell-off in oil … Read More
By Michael Lombardi, MBA | September 5, 2014
So the S&P 500 has touched the 2,000 mark.
Will the S&P 500 continue to march to new highs?
Well, my opinion towards the stock market hasn’t changed. I remain skeptical for a variety of reasons, many of which I have shared with my readers over the past few months.
But I have a new concern about the stock market, something that hasn’t been touched on by analysts: trading volume … Read More
By Michael Lombardi, MBA | August 22, 2014
Not too long ago, I reported that Italy, the third-biggest economy in the eurozone, had fallen back into recession.
Now Germany’s economy is pulling back. In the second quarter of 2014, the largest economy in the eurozone witnessed a decline in its gross domestic product (GDP)—the first decline in Germany’s GDP since the first quarter of 2013. (Source: Destatis, August 14, 2014.)
And more difficult times could lie ahead…
In … Read More
By Michael Lombardi, MBA | June 27, 2014
We are hearing more and more about interest rates getting ready to rise. The Federal Reserve itself has said it expects the federal funds rate to increase to 1.5% by the end of next year and to 2.25% by the end of 2016.
Before the Fed came out with its forecast, I was writing about how the Fed will have no choice but to raise interest rates because inflation is … Read More
By Michael Lombardi, MBA | June 9, 2014
My father is 87 years old. He’s in great shape, drives on his own, plays cards with the guys each afternoon, and has basically been enjoying retirement since he sold his business when he was 65.
Like all retirees, he and my Mom have been living off their savings for years.
And like millions of Americans, the low interest rates we have been enduring since the Federal Reserve decided back … Read More