Weekly Market Commentary – 12/15/2014

Sports Clichés

It can be rather comical when listening to all of the sports clichés that are used during any pre- or post-game interview and the corresponding analysis of any sporting event.  The cartoon on the left from VectorBelly is the stereotypical post-game interview.  The interviewer asks, “What’s your strategy for the next match?” to which the athlete responds, “We need to stop the other team from scoring points while we ourselves score many points.”  We hear commentary that is often merely a statement of the obvious, or phrases we have adopted into our vernacular which on the surface, do not even make sense, but we all know their figurative meaning.  Some of these clichés, just to name a few are:

• We are going to take it one game at a time.
• This is a game of two halves.
• We have to make plays on both sides of the ball.
• We have to stop the big play.
• We just need to go out and execute.
• We need to take it to the next level.

We were reminded .…Read More…

Weekly Market Commentary – 12/08/2014

A Favorite Recipe for the Season

With the Christmas holiday season upon us, so begins the time of school programs, end of year activities, and numerous holiday parties, the latter of which always seems to center on food.  Admittedly, we do enjoy eating the foods of the season and especially so with good friends and family.  It is one of those seasons where we do not simply “eat to live”, but rather “live to eat.”  This time of year, therefore, lends itself to time spent in the kitchen cooking, whether a small snack or a gourmet feast.  Recipes books are pulled out and scattered on the counters as we prepare some culinary delight to share.  With office parties in full swing, we are reminded of a favorite snack in our offices, and while not necessarily a holiday treat, we seem to only pull out the White Chocolate Dusted Chex Mix during this time of year (link to recipe here).

Now, considering the current season of this business cycle (i.e. growing out of recession), all eyes are focused on what the FED will whip-up next and how they will serve this new dish of adjusted monetary policy as they slowly prepare to begin raising short term interest rates.  .…Read More…

Weekly Market Commentary – 12/01/2014

Recovering From a Food Hangover

So how many of you over-ate at your Thanksgiving meal after you swore that you were not going to do so this year?  We seem to do it each time, and admittedly, it is hard not to do so after all the time spent in preparing the food, the massive portions we prepare, which inevitably leads to leftovers that can last more than a week (yep, a 15 pound turkey sounds great, except we only served 4 people at our dinner).  And for many families, the yearly tradition involves eating your meal, then sitting in the living room, rubbing your belly and falling asleep watching one of the football games on television.  Eventually, the food hangover arrives (the bloating, grogginess, a slightly upset stomach, even a headache for some people).  But, is a “food hangover” real?  There seems to be very little with respect to research on the subject, and according to an interview with Dr. Aaron Carroll by Vox Media last week (link here), “I don’t think many people distinguish too well between the concept of a food hangover and indigestion.  If you eat too much, you don’t feel well right away.”

However, it is thought that too much sugar can be a cause for the drowsiness or sluggishness after a meal.  An increase in  .…Read More…

Weekly Market Commentary – 11/24/2014

Using 13th Century Mathematics

Happy Fibonacci Day!  Well actually, that was yesterday (11/23), where the numbers 1,1,2,3 are the first 4 numbers in the Fibonacci sequence.  Italian Leonardo Fibonacci developed this series or pattern where each number in the sequence is the sum of the previous two (1,1,2,3,5,8,13,21,34,55,89,144, etc…) .  This pattern is also closely related to the golden ratio (roughly 1.618) and is estimated by the quotient of the adjacent terms in the sequence (such as 144/89 = 1.618).  This ratio is found time and time again throughout nature as well as in the financial markets.  The spiral pattern formed from this ratio can be seen in items such as sea shells, pineapples, branching plants, flower petals, and pine cones.  Even the proportions of the human body can relate back to the ratio, like the distance from your shoulder to your fingertip as compared to the distance from your elbow to your fingertip.

We saw an interesting article just recently where one can use the Fibonacci sequence to estimate the conversion between miles and kilometers (for you runners out there).  For example, 3 miles is roughly 5 kilometers, and 5 miles is roughly 8 kilometers and etc.

Many traders in the financial markets use this golden ratio .…Read More…