Category Archive

Since the financial media continues to stress the importance of inflation on financial market prices, we will once again discuss this topic (the most recent previous coverage was in April 2021). Inflation refers to a situation in an economy where prices in general are rising. When this occurs, the impact is that the same amount of money buys less, also …

PPA discusses asset allocation regularly in our monthly commentaries. This concept refers generally to the amounts invested in stocks and bonds, and how this split determines the risk-return trade-off as we help you pursue your long-term goals. Once we’ve established an asset allocation customized to your situation, a second level of analysis focuses on asset location, or where it makes …

During September 2021, the three major US stock indices declined between approximately 4.5% and 5.5%, with nine down days out of twenty-one total trading days. The financial media found it necessary to attribute causes to declines of this magnitude. But the frequent price increases in the midst of declines make the effort to attribute daily causation highly suspect. What we …

After another month of modest, slow and steady gains in the financial markets, even in the face of what seems to be unrelenting negative news in the “real world,” we consider the existence of so many “winners” in the financial markets, compared with what appears to be precious few losers  A recent piece by Jason Zweig in his “Intelligent Investor” …

Asset Allocation, as our clients and readers know, refers to the diversification of an investment portfolio among a variety of liquid asset classes. At Park Piedmont (PPA), we use four such asset classes: Cash Equivalents; High Credit Quality Bonds; High Yield/Lower Credit Quality Income; and Stocks. In times of modest market price changes, allocations that have been established to meet …

With financial markets showing modest changes in May, even with Inflation fears and improving economic activity continuing to dominate the financial media (see also our April 2021 Comments), we add the impact of government actions to our discussion. While the market-based private sector dominates U.S. economic activity, there are times when government action plays a crucial role. When the Coronavirus …

In March, market interest rates, which are set by buyers and sellers in the bond market, continued their rapid rise from year-end 2020, with the ten-year US benchmark rate increasing from 0.93% to 1.74%. But even in the face of these rising rates, stock prices continued to advance. Since we have discussed rising rates, inflation, and their impact on bond …

January Markets for Stock Prices  January 2021 month-end stock market figures showed little change, even though there was considerable volatility within the month. The big new news for the financial media was the action in a few small stocks that made huge gains, most likely because they were part of a so-called “short squeeze” by relatively new traders in the …