The Dow Jones had a great year in 2016. The leading index delivered a price return of 14% and paid a dividend yield of 2.7% for a total return of almost 17%. Any way you look at it that is an excellent year for U.S. stocks. However, you could have… Read More

The financial services industry underwent a massive transformation on July 21, 2010, when the Dodd-Frank Wall Street Reform and Consumer Protection Act was signed into federal law by President Obama. Dodd-Frank was one of the largest regulatory overhauls any U.S. industry has ever seen.  It was designed to reduce the concentration of risk in the financial sector. Whether it achieved that goal depends on who you ask. #-ad_banner-#Some say it helped curb reckless trading at the big banks — the kind of trading that left the industry bankrupt in 2008. Others say it hurt small businesses with its expensive-to-implement compliancy… Read More

The financial services industry underwent a massive transformation on July 21, 2010, when the Dodd-Frank Wall Street Reform and Consumer Protection Act was signed into federal law by President Obama. Dodd-Frank was one of the largest regulatory overhauls any U.S. industry has ever seen.  It was designed to reduce the concentration of risk in the financial sector. Whether it achieved that goal depends on who you ask. #-ad_banner-#Some say it helped curb reckless trading at the big banks — the kind of trading that left the industry bankrupt in 2008. Others say it hurt small businesses with its expensive-to-implement compliancy programs at regional and local banks. It’s easier for big banks to absorb these expenses. I say it’s probably a little bit of both. Today — almost eight years after it was passed — Dodd-Frank is about to get a big makeover. This is a profit trigger for the world’s largest derivatives exchange and that pays a “secret” 4.5% dividend. Let me explain. Dodd-Frank Is Set For A Major Overhaul Under The Incoming Treasury Secretary The U.S. Secretary of the Treasury is one of the most powerful and influential cabinet positions. The Treasury controls federal regulations for business, banking,… Read More

November was a scary month for bond investors. The Bloomberg Barclays Global Aggregate Total Return Index fell 4% in November, shedding a record $1.7 trillion in value. That loss ranks as the worst monthly performance since the index was created in 1990, more than 26 years ago. And some of the “safest” bond-related ETFs in the market fared even worse. The iShares 20+ Year Treasury Bond ETF (Nasdaq: TLT) was down 8% in November for a total of almost 20% since July. Similarly, the iShares 7-10 Year Treasury Bond Fund (NYSE: IEF) is down 9% from its 52-week high and… Read More

November was a scary month for bond investors. The Bloomberg Barclays Global Aggregate Total Return Index fell 4% in November, shedding a record $1.7 trillion in value. That loss ranks as the worst monthly performance since the index was created in 1990, more than 26 years ago. And some of the “safest” bond-related ETFs in the market fared even worse. The iShares 20+ Year Treasury Bond ETF (Nasdaq: TLT) was down 8% in November for a total of almost 20% since July. Similarly, the iShares 7-10 Year Treasury Bond Fund (NYSE: IEF) is down 9% from its 52-week high and the iShares IBoxx Investment Grade Corporate Bond Fund (NYSE: LQD) is down 7% from its 52-week high. These losses are being driven by a tectonic shift at the Federal Reserve — the central banking system that controls U.S. interest rates. For the first time in 10 years, the Fed has raised interest rates. #-ad_banner-#This has big implications for bond investors — when interest rates go up, most bond prices go down. This is what triggered the huge capital outflow from bonds in November, as investors were pricing in a rate hike. A lot of short-term capital that was… Read More

The energy sector was a brutal place to invest in 2014 and 2015. In the 18 months from July 2014 to January 2016, the Energy Select Sector SPDR ETF (NYS: XLE) fell nearly 50%. That decline was driven by a collapse in the price of oil, buckling from above $90 per barrel in the summer of 2014 to below $30 in January 2016. #-ad_banner-#Today, this bear market has ended. With a new bullish cycle unfolding, this is the best time to invest in energy stocks in the last five years. Not only are energy sector yields near a multi-year high,… Read More

The energy sector was a brutal place to invest in 2014 and 2015. In the 18 months from July 2014 to January 2016, the Energy Select Sector SPDR ETF (NYS: XLE) fell nearly 50%. That decline was driven by a collapse in the price of oil, buckling from above $90 per barrel in the summer of 2014 to below $30 in January 2016. #-ad_banner-#Today, this bear market has ended. With a new bullish cycle unfolding, this is the best time to invest in energy stocks in the last five years. Not only are energy sector yields near a multi-year high, valuations are near a multi-year low. Perhaps most important, profits are set to rebound thanks to a breakthrough announcement from the Organization of Petroleum Exporting Countries (OPEC). Last week, OPEC made its biggest announcement in more than two years, saying that its members would cut global oil production by 1 million barrels per day beginning January 1, 2017. This decision has big implications for the price of oil in the short run and long run. In the short run, it caused the price of oil to jump more than 10% in one day, hitting $50 a barrel for the first… Read More

American singles bored with the bar scene are increasingly going online to find love. According to a report from the Pew Research Center, the number of American adults that have used online dating increased to 15% in the summer of 2015 from 13% in 2013. That seemingly small 2 percentage point increase represents a full 5 million new customers. As expected, the gains were skewed toward younger people — usage among 18-24 year olds tripled. #-ad_banner-#But as it turns out, older Americans are getting in on the action too. The number of 55-64 year olds that have used online dating… Read More

American singles bored with the bar scene are increasingly going online to find love. According to a report from the Pew Research Center, the number of American adults that have used online dating increased to 15% in the summer of 2015 from 13% in 2013. That seemingly small 2 percentage point increase represents a full 5 million new customers. As expected, the gains were skewed toward younger people — usage among 18-24 year olds tripled. #-ad_banner-#But as it turns out, older Americans are getting in on the action too. The number of 55-64 year olds that have used online dating apps doubled to 12% from 6% in 2013. Both statistics paint a promising outlook for the industry. The surge in popularity has the online dating industry on pace to generate $2.4 billion in sales in 2016. Looking forward, I am expecting industry sales to grow around 5% annually for the next two years. That 5% growth projection might not jump off the page. However, if a big chunk of that growth is captured by one global leader, it becomes significant. The online dating industry has become much more competitive in the last two years, creating nearly impassable barriers to entry. Read More

2016 is on pace to be another record year for gun sales in the United States. According to a recent report released by the FBI, gun sales hit a 17th consecutive monthly record in October, up 27% from the same period last year. #-ad_banner-#This spike in demand is being driven by two powerful forces. The first is crime. Although the national crime rate remains near 20-year lows, crime rates in major cities have spiked. For example, Chicago recently recorded its 600th murder in 2016, a number already 100% higher than that rate in 2015. Demand for guns is also being… Read More

2016 is on pace to be another record year for gun sales in the United States. According to a recent report released by the FBI, gun sales hit a 17th consecutive monthly record in October, up 27% from the same period last year. #-ad_banner-#This spike in demand is being driven by two powerful forces. The first is crime. Although the national crime rate remains near 20-year lows, crime rates in major cities have spiked. For example, Chicago recently recorded its 600th murder in 2016, a number already 100% higher than that rate in 2015. Demand for guns is also being driven by politics. Gun owners and potential buyers worry about stricter gun laws. This is pulling demand forward and prompting consumers to purchase firearms sooner rather than later. Looking forward, I don’t expect either of these forces to fade away quickly — in fact, I am expecting gun sales to hit another monthly record in December and close the year at an all-time high. That’s why it’s a great time to take a fresh look at one of the most undervalued growth stocks in the S&P 500. This global leader’s share price is up more than 145% in the last… Read More

1933 was an important year for U.S. investors. That was the year the 18th amendment was repealed. This regulatory breakthrough accomplished two things. For one, it once again made it legal to drink a cold beer after work. #-ad_banner-#Then, it unleashed one of the best investment opportunities of the century, setting the stage for a billion dollar wealth transfer and giving birth to future global leaders such as Budweiser and Jack Daniels. If you weren’t around back then to capitalize, don’t worry. Today, that same cycle is repeating itself. Cannabis is being legalized all across North America. In the United… Read More

1933 was an important year for U.S. investors. That was the year the 18th amendment was repealed. This regulatory breakthrough accomplished two things. For one, it once again made it legal to drink a cold beer after work. #-ad_banner-#Then, it unleashed one of the best investment opportunities of the century, setting the stage for a billion dollar wealth transfer and giving birth to future global leaders such as Budweiser and Jack Daniels. If you weren’t around back then to capitalize, don’t worry. Today, that same cycle is repeating itself. Cannabis is being legalized all across North America. In the United States, 25 states have adopted medical marijuana programs. Three states have legalized recreational consumption. The list of cannabis-friendly states continues to grow. Nine states are set to vote on cannabis initiatives on Election Day (November 8). In Canada, medical marijuana is already legal on the federal level. Prime Minister Justin Trudeau and the Liberal Party are making it a top priority to also legalize recreational cannabis. It is possible an initiative could be voted on in Canada within the next 12 months. In Mexico, it’s already legal for citizens to carry up to an ounce of cannabis. In April, Mexican… Read More

Third-quarter earnings season has ushered in an important turning point for the S&P 500. With more than 25% of the index reporting, earnings are on pace to increase 0.1% from the same period last year. That 0.1% increase doesn’t exactly jump off the page. But with S&P 500 earnings declining for five consecutive quarters, a return to earnings growth is a positive signal for U.S. stocks. This reversal back to earnings growth is being led by some of America’s most popular brands. #-ad_banner-#For example, JPMorgan Chase’s (NYSE: JPM) per-share earnings of $1.58 beat expectations by 13%. Similarly, Walgreens Boots Alliance’s… Read More

Third-quarter earnings season has ushered in an important turning point for the S&P 500. With more than 25% of the index reporting, earnings are on pace to increase 0.1% from the same period last year. That 0.1% increase doesn’t exactly jump off the page. But with S&P 500 earnings declining for five consecutive quarters, a return to earnings growth is a positive signal for U.S. stocks. This reversal back to earnings growth is being led by some of America’s most popular brands. #-ad_banner-#For example, JPMorgan Chase’s (NYSE: JPM) per-share earnings of $1.58 beat expectations by 13%. Similarly, Walgreens Boots Alliance’s (NYSE: WBA) earnings of $1.07 beat expectations by 8%. While these reports are both excellent in their own right, one company crushed them both. In fact, I am calling it the best earnings report of the season, beating expectations by 100%. In the short run, that should help shares outperform the S&P 500 for the rest of the year. In the long run, this exceptional quarter signals that this market leader still has plenty of growth ahead. A Massive Positive Earnings Surprise Should Trigger Post-Earnings Drift Netflix (Nasdaq: NFLX) should be a familiar name. It virtually created the streaming… Read More

The Federal Reserve has been teasing the market with an interest rate hike for most of the last five years. Finally, it looks like the most powerful central bank in the world is finally ready to make good on its promise. And while that may be considered a threat to industries that rely on cheap cash, it would be a $1.5 billion profit trigger for one of the four largest banks in the United States. Let me explain. Expectations for a Fed rate hike in December recently spiked to a multi-month high. #-ad_banner-#The Federal Funds Futures, a contract traded at… Read More

The Federal Reserve has been teasing the market with an interest rate hike for most of the last five years. Finally, it looks like the most powerful central bank in the world is finally ready to make good on its promise. And while that may be considered a threat to industries that rely on cheap cash, it would be a $1.5 billion profit trigger for one of the four largest banks in the United States. Let me explain. Expectations for a Fed rate hike in December recently spiked to a multi-month high. #-ad_banner-#The Federal Funds Futures, a contract traded at the Chicago Mercantile Exchange that calculates the probability of a rate hike, just hit a multi-month high of 64%. Minutes from the Fed’s September 20-21 meetings reveal that its 7-3 vote to leave rates unchanged was a “close call” and that voting members planned to raise rates “relatively soon.”Both of these indicators point to a high probability that the Fed will finally pull the trigger on raising interest rates before the end of the year. For industries such as real estate and building that rely on low interest rates, this isn’t great news. It threatens to restrict the easy flow… Read More

The U.S. military has been the largest investor in drones since the industry got its start 15 years ago. While U.S. military drone spending will continue growing, a recent regulatory breakthrough from the Federal Aviation Association (FAA) sets the stage for commercial drone sales to eclipse military spending and become one of the fastest growing industries in the world in the next five years. #-ad_banner-#A Regulatory Breakthrough The commercial drone industry scored a big win in late August. That was the day the Federal Aviation Association (FAA) opened up the skies to commercial drones. The FAA ruling allows for… Read More

The U.S. military has been the largest investor in drones since the industry got its start 15 years ago. While U.S. military drone spending will continue growing, a recent regulatory breakthrough from the Federal Aviation Association (FAA) sets the stage for commercial drone sales to eclipse military spending and become one of the fastest growing industries in the world in the next five years. #-ad_banner-#A Regulatory Breakthrough The commercial drone industry scored a big win in late August. That was the day the Federal Aviation Association (FAA) opened up the skies to commercial drones. The FAA ruling allows for small commercial drones to operate during daylight and below 400 feet. That alone is a regulatory breakthrough for the commercial drone industry. But the FAA also recently loosened its restriction on commercial drone pilots. Before, a commercial drone pilot needed an actual pilot license. Now, commercial drone pilots will only be required to pass a test that costs $150. These key regulatory adjustments clear the path for the most powerful S&P 500 companies to invest billions of dollars into their commercial drone programs. In fact, it’s already happening. Amazon (Nasdaq: AMZN) is testing Amazon Prime Air, its system to use… Read More