Latest Blog: Two (Percent) is a Sad Num... - 09/21/2020
Investment Insights are written by Angeles' CIO Michael Rosen
Michael has more than 30 years experience as an institutional portfolio manager, investment strategist, trader and academic.
URSA MINORPublished: 10-02-2015
The bears are stirring. Not yet rampaging, but there’s a lot of red ink across most markets.
Today’s jobs report was weak. No honey-coating it, it was a treat for the bears. Payrolls rose 142,000, well below the 200,000 expected, and a jump in government jobs hid a weaker private sector rise of 118,000. July and August were revised lower, so the employment picture weakened substantially in the 3rd quarter.
The unemployment rate remained at 5.1%, only because there was a huge (350,000) reduction in the labor force, bringing the labor participation rate to 62.4%, the lowest since 1977. About the only bright spot in the release was the broader U-6 data, which include both un- and under-employed: that rate fell to 10.0% from 10.3%, the lowest yet in this recovery.
With red ink spilling across global markets, sentiment has become pretty gloomy (see below).
The good news, from my perspective, is that sentiment is one of my favorite contrary indicators. Indeed, note in the chart above the coincidence of bearishness with market bottoms.
So, yes, the economy is softening in some areas—manufacturing, jobs—although resilient in other areas: auto production is soaring, housing prices and incomes are rising. A recession in the next 12 months seems very unlikely to me, although today’s data may spook members of the Fed to push out the date of their (modest) tightening. The markets now see March 2016 as most likely.
I continue to hold the view that US equities are in the midst of a multi-year bull market, where corrections, dips and gyrations should be expected. This is now a non-consensus view among the growing sleuth of bears which, as you might guess, I find encouraging.PRINT THIS ARTICLE
Criminals in Diapers 08-05-2015
Japan grew from the (literal) ashes of the Second World War to become the second largest economy in the world by ...READ MORE
Updating the Triangle 01-03-2018
Last year, I introduced my big picture framework of assessing the relative attractiveness of markets Inside the Triangle ...READ MORE
O Pais do Futuro 11-30-2015
Charles de Gaulle (photobelow)imperious, disdainful, utterly French (and venerated for it in France)noted 50 years ago ...READ MORE
We build portfolios of best-in-class investment managers across all asset classes. If you would like to be considered for our portfolios, please contact us using our manager inquiries form.
- MANAGER INQUIRIES
How Can We Help You?Institutional Investors
Fully resourced investment office built to manage sophisticated client investment programsPrivate Wealth
Personalized discretionary portfolio and wealth management services powered by institutional processInvestment Management
Rigorous process and a flexible platform designed to meet client needsArticles & Insights
Latest insights and perspectives from the Angeles teamContact Us
Get in touch