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The Best of What They Said and I Read week ending 10/29/2017

Short excerpts from articles I found interesting.

I may not agree with the author and the following material is not intended as investment advice.


Barron’s – October 28, 2017 – Stocks Surge to Highs as Tech Roars Again – by Ben Levisohn

  • “…Then last Friday happened. Stellar earnings from Amazon, Alphabet, and Microsoft sent those stocks up 13%, 4.3%, and 6.4%, respectively. And just like that, tech is hot again. How hot? The Nasdaq Composite gained 2.2% on Friday, 2.06 percentage points more than the Dow Jones Industrial Average’s 0.14% advance, the widest single-day gap between the two benchmarks since 2002. The Standard & Poor’s 500 index rose 0.81% to 2581.07. Both the Nasdaq and the S&P 500 closed the week at new all-time highs.” 
  • “…And it is strange how quiet the market is. October, remember, is supposed to be the market’s most volatile month. Through Thursday, however, it was the least volatile October on record going back to 1928, according to Ben Bowler, global head of equity derivatives research at Bank of America Merrill Lynch. He chalks that up to the fact that the market assumes that the world’s central banks will backstop it no matter what, making every drop a buying opportunity…”

Bloomberg Businessweek – October 23, 2017 - Lessons From Leonardo – Joel Weber

  • “Da Vinci died in 1519, but Walter Isaacson’s biography of history’s most famous creative mind is filled with information that’s useful today.”
  • “…One lesson to learn from Leonardo is to try to embrace many fields of knowledge and passion.  Often we fail to be creative e because we think too narrowly.  Leonardo would just wonder.  What does a woodpecker’s tongue look like?  And he wanted to know, not because it would help him build a flying machine or paint a better painting, but our ot curiosity.  All of that eventually leads to a spiritual feel for patterns of nature.  But even if it doesn’t lead you to someday paint the Mona Lisa, it can still lead to a more enriching life…”

Barron’s – October 27, 2017 – Wall Street’s Best Minds - Greg Valliere:  Investors are Upbeat

  • “…“Every few months we run this feature, because we learn so much from talking with investors, both institutional and retail. So this morning we will pass on what we’re hearing -- the consensus of investors, who provide a refreshing contrast from the Beltway mentality. Here goes:”
  • “Donald Trump is widely mocked but his policies are praised. Most investors are savvy enough to divorce the Trump tweets -- which are viewed as childish -- from the generally pro-business climate in Washington, which is cited as a factor in the stock market rally.”
  • “Surprisingly, most clients don’t expect tax cuts to affect them much personally. But they anticipate a major plus for business, with much lower corporate tax rates giving the stock rally another leg up. No one seems to care whether the tax cuts pass in December or March; investors simply want the process to advance.”
  • “…Business execs we talk with have been complaining for over a year that they can’t find skilled labor, and recently they have lamented that they can’t find enough workers who can pass a drug test. Trump’s proposal to curb legal immigration is viewed with dismay.”
  • “…The only politician who gets good grades -- and whose reputation has improved this year -- is United Nations Ambassador Nikki Haley, the near-certain successor to Rex Tillerson at the State Department.” 
  • …That’s our summary of client attitudes. They’re a pretty optimistic bunch -- not euphoric, but cautiously optimistic. Sir John Templeton famously said bull markets begin with despair and end with euphoria; investors we talk with are not euphoric yet, which persuades us that the rally will continue.”


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