The Road Ahead: 2015 Outlook

The Road Ahead: 2015 Outlook

  • Posted on: 9 December 2015
  • By: admin

 

The following is an excerpt from our article: The Road Ahead: 2015 Outlook, which can be found HERE

What does one say when it has all been said before? That is the seminal question facing us as we write our 2015 Outlook. This piece will be the sixth we have penned since opening Pathlight Investors in 2009, and every year since then feels like, not a total repeat, but eerily similar to the last. Sure, the names have changed—well more like come, gone, and resurfaced, but the overarching themes have remained constant since the March 2009 lows.

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Looking Back: 2014 Year in Review

Looking Back: 2014 Year in Review

  • Posted on: 9 December 2015
  • By: admin

The following is an excerpt from our article: Looking Back: 2014 Year in Review, which can be found HERE

 

In between talk about Ray Rice, Uber, and Social Media, investment markets were laser focused on Ebola, ISIS, and Russian invasions. Throw in chatter about a Eurozone breakup (for the sixth consecutive year), plunging oil prices, mid-term elections, a widening wealth gap, a disappearing middle class, Japanese recession, and slowing China, it could have been a very tough year for investors.

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Pathlight Investors’ Top Recommended Reads - January 2015

Pathlight Investors’ Top Recommended Reads - January 2015

  • Posted on: 9 December 2015
  • By: admin

Ready for some more great articles?  Here's our picks for January 2015:   
 
Crude exports – two US senators on Tues called on the Commerce Dept. to reconsider a recent move that would make it easier to export crude; the senators worry such a move could lead to higher domestic energy prices – Reuters     http://goo.gl/ZWu8UZ  

Obama’s State of the Union was anticlimactic as the White House had preannounced the speech’s major contents over the preceding days.  The main focus was on strengthening the middle class which Obama plans to do via a variety of new tax and education initiatives (to be paid for by higher capital gains taxes and elimination of the “trust fund loophole”).  The President expressed confidence in his anti-ISIS strategy and called on Congress to give him fresh authorization to combat extremists in the Middle East.  The full transcript can be seen here: http://goo.gl/4jyk5C.  Note that Republicans rejected many of Obama’s economic messages http://goo.gl/iZJCsi

 

US companies slashing jobs.  A slew of marque American companies, inc. EBAY, AXP, BHI, SLB, and others, have announced thousands of job cuts in the last few days.  FT    http://goo.gl/jJ5yBl  

 

Net neutrality – Republicans introduced legislation that would prevent broadband providers from blocking, slowing, or speeding access to specific website but would avoid imposing Title II regulation on the industry – WSJ    http://goo.gl/FVYkkZ  

 

Saudi Arabia – Saudi Arabia’s new king will prob. leave oil policy unchanged; according to the WSJ, the new leadership is likely to keep oil policy unchanged (http://goo.gl/zsHhqJ); CNBC discusses “why Saudi succession isn’t a big deal for oil” (http://goo.gl/c9Q0nJ); the new King will keep the main ministers in place (inc. oil and finance). 

 

China – the PBOC injected ~$8B into the banking system using short-term instruments it hasn’t used in a year.  The PBOC offered $8B in 7-day repos on Thurs, sparking speculation it may loosen policy further in the coming weeks.  The move comes after the PBOC on Wed said it would roll over 3-month loans of $43.5B and offered 50B yuan of medium-term loans to certain commercial banks.  WSJ  http://goo.gl/up9FtI

 

Ukraine violence worsens – the leader of separatist forces said he wouldn’t participate any longer in ceasefire talks and planned on pushing forward against Ukraine gov’t troops – WSJ   http://goo.gl/fuvIoA 

 

And On A Lighter Note…

 

Death by chocolate: a problem for bears in New Hampshire - http://goo.gl/O6DuVi

 

 

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Pathlight’s Five-Year Anniversary: What We’ve Learned

Pathlight’s Five-Year Anniversary: What We’ve Learned

  • Posted on: 9 December 2015
  • By: admin

The following is an excerpt from our article: Pathlight’s Five-Year Anniversary: What We’ve Learned, which can be found HERE

On November 18th, Pathlight proudly celebrates its five-year anniversary.  In looking back at what has transpired since that day, there is no doubt that a lot has been learned by the Team here both as business owners and investment managers.  During this introspection, I spent some time reviewing our Investment Outlook publication for years 2010-2013 in order to accurately recall this uniquely challenging investment world we continue to navigate.  In doing so, it is clear that I could fill an entire book with major concerns that have kept investors nervous and many in cash despite strong investment results for stocks, bonds, and real estate.  As such, I think it’s valuable to use Pathlight’s anniversary as an opportunity to review the concerns, the results and the lessons we have (hopefully) learned over the last five years. 

 
 

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Pathlight Investors’ Top Recommended Reads - November 2014

Pathlight Investors’ Top Recommended Reads - November 2014

  • Posted on: 9 December 2015
  • By: admin

additional volatility.  Dudley echoed her comments in separate remarks.  WSJ   http://goo.gl/8VEQ9w  

 

House – the GOP could very well keep a majority in the House for the next generation at least.  NYT   http://goo.gl/Mhxp4G   

 

Net Neutrality – Wheeler to break w/Obama over net neutrality – according to the Washington Post, FCC Chairman Wheeler is preparing to move in a different direction from what Obama proposed Mon w/regards to net neutrality and industry regulation.  Wheeler apparently has told industry reps that he preferred a more “nuanced” solution vs. what Obama talked about earlier this week.  “The dissonance between Obama and Wheeler has the makings of a major policy fight”.  Washington Post  http://goo.gl/pmVDof    

 

US shale drillers are starting to idle some rigs according to data out last week; rigs targeting oil sank by 14 to 1568 last week, the lowest since Aug 22 (it peaked at 1609 back on Oct 10).  The Eagle Ford shale formation in south Texas lost the most, dropping 9 to 197.  Drillers are slowing their activity as crude prices tumble.  Bloomberg   http://goo.gl/egV7gk

 

China – President Xi told a group of global business leaders that the risks facing China aren’t “that scary” and the government is confident it can handle them.  "Some people worry that China's economic growth will fall further, can it climb over the ridge?" Xi said. "There are indeed risks, but it's not so scary.  "Even at growth of around 7 percent, regardless of speed or volume, (we) are among the best in the world," he said, noting that China's economy remained "stable".  Reuters   http://goo.gl/F3YLfe  

 

Russia/Ukraine – four reasons by Putin may be marching back into Ukraine: 1) ensure the rebel-controlled regions stay within the Russian orbit after recent elections revealed a strong pro-Western bias; 2) help the rebels retain their tenuous grip over their controlled territory; 3) ensure a supply route into Crimea; 4) ensure the rebels stay loyal and beholden to Moscow – Bloomberg  http://goo.gl/748B3j  

 

OPEC meeting coming up on 11/27 – is a production cut possible?  After being adamant that a production cut wasn’t coming, Reuters says some OPEC delegates are now “whispering” about the need for output to be curtailed.  Reaching a consensus on this matter won’t be easy and rather than formally lowering the quota OPEC may instead call for greater discipline of the existing target (right now output is ~500K BPD above the official quota – if OPEC imposes greater discipline that would be similar to a production cut).  http://goo.gl/35YkLl  

 

And On A Lighter Note…

 
Arctic storm has Colorado shoveling ... tumbleweed - http://goo.gl/6SRPzJ

 

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Third Quarter Investment Review

Third Quarter Investment Review

  • Posted on: 9 December 2015
  • By: admin

The following is an excerpt from our Third Quarter Investment Review, which can be found HERE

As we sit down to pen our 3Q review letter, we are faced with equity markets that have experienced a marked change in their behavior.  The sanguinely steady upward march of this bull market has been replaced by heightened volatility, extreme upward and downward moves of greater than 1%, and an increased level of fear that this time is different and that a correction within the bull market could morph into a decline of some magnitude—we even hear that we could experience another 2008/2009-style meltdown.

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