Posts by Kirill Zagalsky

February 27, 2018 |

Why Paper Money Fails

Life Preserver Cash

There’s nothing like the feel of cold, hard cash in your hands. Holding a wad of bills may provide a sense of empowerment, as you feel the texture and weight of the money in your hands. For a moment now, however, try to take a different view. Imagine that in your hands is not money, or cash, but rather a stack of IOUs or promises. Doesn’t have quite the same ring to it now does it? The fact is, paper money is exactly that: IOUs... Continue Reading

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February 21, 2018 |

There’s Few Good Options

Gold umbrella

Alternative asset classes are more important than ever, and investors have never had so many vehicles with which to diversify their portfolios. This would seem to be especially important in the current environment, where neither stocks nor bonds may offer investors a good value. The stock market has been on the rise for the last decade. Although it is impossible to say exactly when the bull market may finally come to an end, history would seemingly indicate that the current bull could run out of... Continue Reading

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February 15, 2018 |

Are Markets Headed Back to Earth?

Polar Bear

The recent volatility seen in global stock markets has largely dominated headlines in the financial media recently, and many investors are likely wondering why the sudden sharp increase in price swings. Regardless of what the reason may be-whether it is overaggressive betting against volatility, the idea of rising rates, accelerating inflationary pressures or the current state of geopolitics-there may be a simpler, albeit unpopular answer: Stocks and risk assets are seeing a return to valuations more in line with historical norms. That’s right: Stocks have... Continue Reading

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February 9, 2018 |

Pay Attention

stock-market-crash-crisis copy

The stock market has exhibited enormous volatility in the last several sessions. It started last Friday, with the Dow Jones Industrial Average dropping over 700 points. The sellers were far from finished, however, and the selling resumed full force on Monday. The opening session of the trading week saw the Dow decline by an astounding 1600 points at one point, before rebounding a bit to end down a whopping 1175 points-the largest point decline on record. Tuesday looked as if it might be another brutal... Continue Reading

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February 2, 2018 |

Don’t Fear Higher Rates, Welcome Them

the stage is set

The U.S. Federal Reserve elected to hold rates steady at its latest policy meeting on Wednesday. This move came as no surprise. The Fed also discussed how it sees the need for gradual hikes going forward, which is also not very newsworthy. Many investors, however, seem to misinterpret what higher rates really mean for the markets. Gold is a common object of discussion when it comes to higher interest rates. The theory, among some investors and some financial “experts” goes something like this: Higher rates... Continue Reading

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January 30, 2018 |

A Double Whammy of Rising Inflation and a Falling Dollar

major hurdles

Investors could potentially be in for a rough ride in 2018, as several key market dynamics are changing. The Fed has been slow to raise rates further-and with good reason- as inflation for some time lagged well-below the central bank’s desired target of 2% annually. The central bank seems to be thinking a bit differently at this point, however, as some key indicators of inflationary pressure have been ticking higher in recent months. The central bank has penciled in three rate hikes this year, but... Continue Reading

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January 24, 2018 |

Is the Dollar a Sinking Ship?

without a deal

The shutdown of the U.S. Government over the weekend is likely to dominate the headlines this week. Although it seemed late Friday that a deal could potentially be reached in time, Republicans and Democrats appear to be far from an agreement at this point. Stock investors didn’t seem to be fazed by the potential shutdown on Friday, but that could change in a hurry if both sides of the aisle are not able to make progress quickly. Although the shutdown is not likely to have... Continue Reading

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January 18, 2018 |

Could a Hard Landing be on the Horizon?

Gold stock

There is no doubt that the economy is on stronger footing than it was a decade ago. Whether or not the current path can be maintained, however, is another question entirely. With improvement in the labor market, a stable real estate market and economic optimism at its highest in some time, you have to wonder if the Fed may need to become more aggressive at some point. New York Fed President William Dudley recently commented on this very issue. In an article from Marketwatch.com, Mr.... Continue Reading

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January 12, 2018 |

Things Are About to get More Interesting

Polar Bear

As the stock market has continued its seemingly never-ending ascent, something else has been happening in the background, albeit more quietly: Yields have been rising. On Tuesday, famed bond guru Bill Gross of Janus Henderson and formerly of PIMCO suggested that the treasury market has officially entered bear market territory. With a current yield in the neighborhood of 2.55%, the ten year note yield has broken a 25 year trend line. Gross had suggested back in October that a sustained move past 2.40% on the... Continue Reading

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January 8, 2018 |

Could Inflation Be Lurking Around the Corner?

It’s no secret that inflation levels have been running well below the Fed’s desired target of two percent. Despite stubbornly low inflation levels, the central bank stands ready to hike rates further in 2018, perhaps as many as three times. Does the central bank know something the rest of us don’t? While the conspiracy theorists may be disappointed, the answer is probably not. Inflation has remained below desired levels, and it seems to be a thorn in the Fed’s side. Although inflation reports and other... Continue Reading

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