Tag Archives: Robert McTeer

FOMC cool your guns! We Agree with McTeer on this one

One of our favorite local economists and former Dallas Federal Reserve Bank chair, Robert McTeer was out with an excellent comment about the FOMC actions earlier this week. (We think as an Aggie, he might be on a roll…Johnny/Heisman?) No matter, from our perch, we agree, here is why.

Today the FOMC will make an announcement after the conclusion of their final two-day meeting of 2012. We think, again, members should do nothing, as we said here, here, and here before.  This time with the afore-mentioned Fiscal Cliff pending, according to Robert McTeer which we strongly agree with,  more easing let’s our politicians slightly off the hook. “Positive measures would only help enable further inaction. ….Doing something will be tempting since the FOMC’s so-called operation twist is scheduled to expire at year-end” Agree, 100% even further more, we do not think the last round of easing was necessary, but we digress.

Not to jump on the McTeer train, but his final comment is our continued concern  “If it becomes necessary, it can be done after the 2013 recession begins.” We have long worried about taking the QE medicine in more sanguine times and what is left if something REALLY bad should happen.

Here are the diminishing results of the QE’s per chartstore.com

Chartstore Q E Effects

As you can see, each QE has resulted in less and less of an effect. Hold off boys and let the bureaucrats clear a path…We believe they can/will!

Have a great day!

JK

214-706-4300
www.jkfinancialinc.com
8222 Douglas Ave # 590
Dallas, TX 75225

Fiscal Cliff…not beating a dead horse, but addressing the rhetoric…A sick crew and a 26.2

Earlier this week we poked fun at the Fiscal Cliff talks with our cartoon post, but after reviewing the latest popularity of the subject matter, we thought it worth a more serious discussion, even though we feel slightly like we are beating a dead horse (apologies horse lovers…only a cliche…no harm meant…haha)

Here is a google trend graph showing the popularity of the search term “fiscal cliff” that set us into motion:

12-4-12 Google Trend Fiscal Cliff Graph

We first met the Fiscal Cliff in April 2012 during our Private Client Robert McTeer talk, as he very accurately proclaimed a total failure to do anything would be a 7% negative economic drag on our economy. We are currently running at about 2%, so that would put us readily into recession territory.

What is the Fiscal Cliff?

The cliff or Fiscal Cliff, named by FOMC Chairman Ben Bernanke is the collective increase of taxes and spending cuts all at the same time, due to occur 1-1-2013. If nothing is done, tax rates will increase dramatically next year slowing our economy.

How did this come about?

Continued bureaucratic debates and compromise set this date in stone after debt ceiling, tax increase, and political compromises.

Are we concerned ?

Sure, we were concerned about Y2K too, but it all worked out. Are we running for the hills, NO WAY!

Our probabilities for outcomes:

If you have been following us long, you know we like to assign probabilities for outcomes, so here go with our blended probabilities for END OF THE YEAR actions (JK and DC…yes they are different in certain areas):

  • 10% completely resolved and everyone is happy–YEAAA–Market Positive
  • 20% Nothing gets done and we start the new year with higher taxes–BOOO–Market negative
  • 70% Extension of most everything with maybe a couple of token compromises (Can kicked down the road)–YAWN–Market neutral

What we find interesting is the US political checks and balances, at their core, were established to guide, discipline, and enhance our economy. We think it works and we like our chances/odds always! However, at this moment, the very checks and balances that were meant as guide posts are a wall that COULD hamper economic growth dramatically, but we doubt it.

Have a great day!

JK

PS Post holiday party sickness is running rampant, we have two stomach bugs, two pink eyes and two running fever…that I know of…yikes!

PSS Sunday marks the second try at a sub 4 hour trot…mother nature looks to flex her muscles once again with higher temperatures, making it tough for a rhino!

214-706-4300
http://www.jkfinancialinc.com
8222 Douglas Ave # 590
Dallas, TX 75225

Summer Doldrums, We Don’t Think So !

Even though my 7 and 4 year old swear summer is upon us (counting down the days), which often makes for a dull time in the capital markets, we think this will be an interesting summer.

US tax issues, debt ceilings, “Pain in Spain” (insert numerous other little brother country name) and an election for the US should keep the cobwebs from forming this summer.

We were a little light on comments this week (this being the 3rd), but promise to make it up to you next week. A 90 day treadmill update, along with a few summer saving ideas lead our list of “to do’s for the coming week.

Once again we thank those who made Robert McTeer’s article of questions this week, well done, we are still very impressed!

Until next week, we thank you all for reading our work and wish you a wonderful weekend!

JK

PS : If you have a friend that needs financial related help, send them our way, we are glad to assist in any way and thank those who have already done so!

214-706-4300

www.jkfinancialinc.com

 

Congratulations to those who sent Robert McTeer Questions, You Made An Impression

Congratulations to all of you who sent questions for the recent Robert McTeer Private Client event.

YOUR QUESTIONS WERE OBVIOUSLY IMPRESSIVE AS IT MADE HIS COMMENTS THIS WEEKEND.

Here is Mr. McTeer’s Sunday Post “Some Questions and Answers” which includes your Questions. Go ahead, take a look, and see for yourself.

Wow guys, you made a great impression. Those of you who sent questions, pat your self on the back!  Well done, and thanks from the rest of us for the great job and super impression you made.

April 28th, 2012

2 PM

Private Client Event

While this takes a little steam out of our coming Newsletter, we are happy to give you all a shout out of congratulations.

Have a Great Monday and a super start to another great week !

JK

214-706-4300

 www.jkfinancialinc.com

Robert McTeer Event Reminder (Saturday April 28th, 2 pm) and Questions From Those Unable to Attend

Another reason we are so happy to work for all of you, our clients!  Many of you who are unable to attend our premier private client event (we will miss you) have sent questions for us to ask Mr. McTeer.

We thought this was such a great idea, we wanted to offer it to everyone. So, if you have a question, please email it to cathy@jkfinancialinc.com and we will either ask Mr. McTeer at the event, or since we have had many questions, we are sending him questions prior to the event as well.

Great work to everyone and thanks for sharing your ideas and concerns ! We will return the favor by sharing Mr. McTeer’s responses back with you in this post and our Newsletters.

As a reminder the event is Saturday, April 28th 2 pm at the Park Cities Hilton, and will last approximately 1-2 hours.  Again, due to the inaugural nature of this event for us, we are asking for a firm RSVP to cathy@jkfinancialinc.com by Monday, April 23, 2012 if you have not done so already.

Have a Great Day and a Super Weekend !

JK

www.jkfinancialinc.com

214-706-4300

First Quarter 2012 J.K. Financial, Inc. Performance Report Cover Letter (Clients)

Dear Investor,

Enclosed you will find your Q 1, 2012 Performance report for your perusal. As a review this report summarizes your transactions for the latest 90 days and also contains tax basis for all investments.

With the weight of the world on their shoulders, capital markets have moved dramatically from negative to positive emotions in less than one and a half quarters. Just as we were penalized last year for having negative influences resulting in very meager returns, investors have turned on a dime and declared victory resulting in overly optimistic returns in the short term, in our opinion.

Just as we made purchases when times were dark, we are sticking to our allocations and rebalancing. Given current market enthusiasm, that means selling investments that have gone up and are again out of balance as most capital markets moved in double digit form through the end of the first quarter.

While we had thought the possibility of a pay-back year was in the cards for the meager returns from last year, it is very likely market participants have once again overshot, this time to the high side. Given the election, international and domestic concerns we would not be surprised to see a pullback of 5-7% which we believe would be healthy for the capital markets and participants. We think it is a good idea to keep from being too attached to possible continued returns of this magnitude in the near future, i.e. next two quarters.

If the capital markets continue to rise with such speed and enthusiasm without major further positive data points we will follow our discipline and rebalance possibly in an even more aggressive manner.

We hope you have seen that we have a very special private client event later this month with Robert McTeer, Former Dallas Federal Reserve Chair and fellow Greenspan FOMC board member. The event is April 28th at 2 pm, and being the first of its kind, we think very timely and especially exciting given the political and economic situation of recent.

In closing, thanks very much for your continued support and we look forward to an interesting year as many items unfold.

Have a Super Spring!

Sincerely,

John A. Kvale CFA, CFP

Enclosure (First Quarter 2012 Performance Report)

Fastest Quarter In A While, NBA Market (Nothing But Apple), Good Friday with The Masters

Take a deep breath, the first quarter of 2012 is in the books in what seems like a flash!

Domestic Indexes performances were dominated by one stock, Apple! In what a contrarian investor we like and follow regularly, Doug Kass calls “NBA” markets, “Nothing But Apple” Quarter.  It has been some time since we have seen such a large company dominate the indexes; flashback to 99? In what have you done for me lately fashion, time will tell what the future brings.

As you read this, I am out-of-state today for a quick turn around trip.  Tomorrow brings a rest for domestic capital markets as Good Friday is honored and we will be out of the office as well. As a former collegiate golfer (helped pay my way through college) having Good Friday and The Masters synched is terrific.

Speaking of sporting events, our Q2 2012 Newsletter is on the press and turned out very well, with a light-hearted first pitch baseball theme. We compare and contrast the famous sport to investing, building a portfolio, and the psychology needed to be a good long-term investor. We think you will like it and even updated our market thoughts with greater detail than normal.

Lastly, we are super pleased with the Robert McTeer responses and look forward to seeing all of you at the April 28th event. (Don’t forget to RSVP to cathy@jkfinancialinc.com as we need a firm headcount.)

Have a Great Day and a Super Extra Loooong Weekend!

JK

214-706-4300

www.jkfinancialinc.com

Private Client Event with Robert McTeer, Former Dallas Federal Reserve President

You and a close friend are invited to

A Private Client Fireside Chat With

Robert McTeer

Former Dallas Federal Reserve President

Presented By J.K. Financial, Inc.

April 28th, 2012 2 pm Park Cities Hilton – Royal Room

5954 Luther Lane- Parking at BBVA Compass

Across the Street from J.K. Financial, Inc. Offices

Very Important – Please RSVP By:  4-23-12

cathy@jkfinancialinc.com

214-706-4300

5 McTeer Positives This Week!

With Ziggers and Zaggers being tossed around on a daily basis we are finding it entertaining that many are switching sides so quickly. Here are this week’s Zigs from our friend Robert McTeer, former Federal Reserve Member, Aggie, and one of our favorite local economists:

1. “Why are we surprised Europe is slow to adopt the solutions we did, when here in the US, we are still criticizing our actions” :  Mr. McTeer, somewhat flipping said this during his talk, and makes for our lead off positive, as this implication is the EU will eventually start making dramatic economic moves, and of course, it is not so easy to just turn on the money spigot!

2. The EU union members are whipping their Club Med little brothers into shape : In another humorous example of hopeful resolutions from the EU, McTeer mentions that is takes some time to whip the perennial slackers into shape, but, per McTeer it will happen. A second positive for a room full of Zaggers who say the EU is hopeless.

3. Interest rates will lead to eventual inflation : As fellow predictors of inflation much earlier in this recovery, being incorrect up to this point,  having our buddy Mr.McTeer mention it is coming gives us hope. Inflation is a welcomed friend in this current economic situation since we could infer that growth and demand would be the cause of such pressures. We are hanging our hat (loosely..haha) on this one as a positive this week.

4. Macro Economic Numbers are Awesome : McTeer mentioned, better GDP, Employment, Consumer Confidence, Retail Sales, PPI, CPI, Production and Capacity Utilization, all going in the appropriate direction. This is a multi positive, and we were impressed at him being able to rattle off all these economic reports and numbers . Great work Bob, for a multiple positive!

5. Lastly, “This Economy is like a Coiled Spring” : McTeer mentioned this to our happy surprise, saying all we have to do is get out of our own way (politically speaking, to both respective parties) and the US is ready to grow rapidly. Which we found as the most positive comment of all, and as such, made for our final positive of the week.

Thanks once again for Zigging with us while others continue to Zag. Even with next week being a short week, we feel sure the Zaggers will be out in full force as the super committee reports their budgetary findings and recommendations.

On, last item, a special thanks for reading this weeks posts as they were a bit heavy due to my time in the trenches. We promise to get back on the tracks of broader information, but wanted you to hear what was on our mind this week.

Stay Positive and Have a Great Weekend!

JK

214-706-4300

PS Watch out Turkeys!