Russell Bailyn's Financial Planning Blog

There was a spread in the Wall Street Journal at the end of 2007 in which a variety of seasoned financial experts were asked where the markets were headed in 2008. The predictions were mostly bullish - Dow 14,000 - Dow 15,000 - Dow 16,000 - true dreamers. A couple of people more accurately predicted flat markets in the face of staggering oil prices and a weak housing market. But nobody--none of the experts--expected a 10% decline in the first quarter alongside a massive credit crisis. I’ve listened to hundreds of bulls and bears make predictions about market direction over the past five years and I keep returning to the same conclusion: these people have no clue where the market is headed.

Continue reading "Are Market Predictions a Waste of Time?" »

Posted by Russell Bailyn at 12:57 PM | Permalink | Comments (0) | TrackBacks (0)

As we continue to question the softening economy, I’ve noticed lots of finger pointing in the media. Originally it was let’s blame Greenspan and the old Fed for keeping interest rates too low for too long. Now people are blaming Bernanke and the current Fed for not anticipating the credit crisis earlier and brainstorming a solution. Yet others blame the mortgage brokers and banks for not adequately disclosing the terms and risks inherent in certain loans which we now know to be junk. And of course, why not blame Bush? The president has driven up our federal deficit by paying for a war which is totally out of favor with the public. So who should really take the heat for the current economy? You should.

Continue reading "Market Turmoil: Taking Personal Responsibility" »

Posted by Russell Bailyn at 02:21 PM | Permalink | Comments (0) | TrackBacks (0)

I have a hunch that food inflation is about to take center stage. Some may have noticed the increase in chatter about farm subsidies and commodity prices already in the early rounds of presidential debate. This is likely to continue into 2008 because agriculture prices are currently in ‘spike’ mode. Take a look at the Deutsche Bank Liquid Commodity Index--up 18.6% since January 1st--as proof.* This index covers wheat, corn, soybeans, and sugar among other commodities. So what’s driving these prices higher? And what can you do to protect a portfolio against agflation (agriculture inflation)?

Continue reading "A Simple Breakdown of Agflation" »

Posted by Russell Bailyn at 05:15 PM | Permalink | Comments (1) | TrackBacks (0)

We’ve been talking in my office about getting a bit more defensive with our investment portfolios. The S&P 500 is up over 9% since January 1st and the year is half over. If you check my post from a few months back, fund manager Curtis Teberg offered a projection of the Dow Jones reaching 16,000 by year end. His reasoning? The 15-month period preceding a presidential election tends to boast big moves in the market. His testing goes back as far as 1926 and hold up fairly well. Yesterday the market closed up over 280 points, shining light on the magical 14,000 level. Are we going to get there by year end? How about within a week? (Note: Past Performance is not a prediction of future results).

Continue reading "Bullish? Or Bearish? It's a Tough Call" »

Posted by Russell Bailyn at 01:21 PM | Permalink | Comments (0) | TrackBacks (0)

An article in Registered Rep magazine in November tells the market forecast of Curtis Teberg, a portfolio manager based out of Minnesota. Teberg puts the Dow at 16,000 by December 31st, 2007, a 33% increase over its value on October 1st. Wow! I’d better start loading up on blue chip stocks. Apparently I’ve already missed out on a 6.2% move in the Dow since October 1st! Or, is this an unfounded and spontaneous move? Check out the basis for this forecast and see how it sits with you.

Continue reading "Market Historian predicts Dow Rally to 16,000" »

Posted by Russell Bailyn at 01:39 PM | Permalink | Comments (4) | TrackBacks (0)