Market commentary
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Four reasons why rates will stay lower for longer
Roger Montgomery
September 22, 2021
A September research note by Macquarie Bank supports what we’ve been thinking for a while: that interest rates are set to stay low well into the future. And if we are correct, it means this market – toppy as it seems – has further to run. continue…
by Roger Montgomery Posted in Market commentary
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Are we likely to see a correction or crash from the COVID-19 situation?
Roger Montgomery
September 13, 2021
Crashes tend to occur when investors are surprised by something. The unexpected or the ‘black swan’ event is what triggers fear and financial protectionism among investors. There are several reasons why I believe investors can be optimistic about the market over the next year or so, notwithstanding a temporary pull-back of 10-15 per cent is always possible and should be considered a normal part of every investors journey. continue…
by Roger Montgomery Posted in Market commentary
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Three reasons why I am still bullish on this market
Roger Montgomery
September 10, 2021
Over the past 12 months, the All Ordinaries index and the S&P 500 have risen around 26 and 35 per cent, respectively. Not bad when you consider the economic ravages of the COVID-19 lockdowns. But despite these strong performances, there are three good reasons to believe sharemarkets will continue to climb over the coming year. continue…
by Roger Montgomery Posted in Market commentary
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Despite declining efficacy, vaccines are our only way back to normal life
Andreas Lundberg
September 9, 2021
I have been reading the media reports noting the efficacy of COVID-19 vaccines declines over time. Thankfully, even with reduced efficacy, vaccines provide protection from serious disease, and a booster shot will increase efficacy. A high vaccination coverage provides the impetus for politicians to safely re-open our societies. And that will be a shot in the arm for many Australian businesses. continue…
by Andreas Lundberg Posted in Market commentary
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Why unfettered capitalism is failing us
Roger Montgomery
August 31, 2021
One of the seemingly inevitable consequences of capitalism is the increasing concentration of market power in the hands of fewer and fewer large corporations. This issue was raised in a recent speech by ACCC Chair, Rod Sims, who noted the many ways in which increasing market power is adversely impacting Australian society. In his speech, Mr Sims also stated what I have long been advocating: governments need to do something about it. continue…
by Roger Montgomery Posted in Global markets, Market commentary
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VALUE AND GROWTH: TWO SIDES OF THE SAME COIN
The investment industry and media spend a lot of time discussing ‘value’ versus ‘growth’ investing – and which of them is currently winning. But we don’t believe they’re opposite concepts. Investors should consider both ideas together as they seek out quality companies with bright prospects that will deliver rewards over time.
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How to cut small cap risk when inflation is on the rise
Roger Montgomery
August 11, 2021
Given the increasing threat of inflation, many investors are asking me what impact it will have on small companies. The quandary is that small caps are more volatile than large caps, but they can provide greater potential for long-term growth. For me, the answer lies in high quality stock selection. continue…
by Roger Montgomery Posted in Companies, Market commentary
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What can we expect from inflation?
Roger Montgomery
August 9, 2021
It has been noted by some economic observers that Fed Chairman Jerome Powell has, in 2021, been consistent in one aspect of his predictions about inflation; that he’s consistently wrong. The message, as we’ve discussed here at the blog throughout the year, is that inflation is transitory. Base effects will ensure inflation turns to disinflation with the passage of another year, and capitalism’s supply response will solve the bottlenecks in global commodity supply chains. continue…
by Roger Montgomery Posted in Editor's Pick, Global markets, Market commentary
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Australia’s COVID-19 National Plan charts our way back to normal
Roger Montgomery
August 4, 2021
Finally, Australia’s vaccine rollout is beginning to gain traction. In July, around 4.5 million vaccinations were administered – more than double the rate achieved in May. While we’re still playing catch-up with other countries, like Israel, the UK and USA, it’s heartening to see we are working our way back to life as we once knew it. The aim now is to get 80 per cent of the population fully vaccinated as fast as possible. continue…
by Roger Montgomery Posted in Market commentary
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Why asset price inflation is set to continue
Roger Montgomery
August 3, 2021
Soaring house prices in Australia and overseas are but one aspect of the asset price inflation that is now gripping much of the world. While this may be good for the owners of those assets, it is leading to increased inequality within and between countries. And that’s a phenomenon that, history shows, often ends badly. continue…
by Roger Montgomery Posted in Editor's Pick, Market commentary
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Are we about to see a profit and dividend bonanza?
Andreas Lundberg
July 30, 2021
We are about to enter reporting season, when most of our listed companies report their results for the prior financial year. With stock market indices at all-time highs, it looks like the market is expecting many of our larger companies to come out with solid earnings and dividend announcements. Perhaps more interesting will be their forecasts for the year ahead. continue…
by Andreas Lundberg Posted in Companies, Market commentary
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