Category

Stock Market

Mar 30
7

Zach Abraham Featured on MSN Last Week

By | In The Headlines, News, Stock Market

On Monday, March 22nd, stocks finished higher as the 10-year U.S. Treasury yield was slightly down compared to its recent highs.

Bond yields recently have been rising on investor concern that a stronger economic rebound will lead to higher inflation. However, the Federal Reserve said that, although as pandemic recedes and the economy recovers prices will be pushed up, there was no sign yet that this will deliver unwanted inflation.

In fact, the Fed has said it believes an increase in inflation in 2021 will be temporary given COVID-19’s disruption to the labor market.

Bulwark CIO Zach Abraham watches trends closely, and implements investment strategies to help take advantage of all market conditions. His comments were published by MSN last week:

“The recent rise in rates should continue to compress multiples on high flyers and stocks with rich valuations,” said Zach Abraham, principal and chief investment officer of Bulwark Capital Management. “A rise in inflation should also result in a much more friendly environment for value stocks and dividend payers.

“We’ve had a historic run in growth. But the time for value has come. This rotation has a lot of kegs and should run for a while,” Abraham added.

 

Read the original story on MSN here:

https://www.msn.com/en-us/money/markets/stocks-rise-as-tech-gains-lead-wall-street-higher-nasdaq-up-17percent/ar-BB1eQbSu

The article was also picked up by The Street:

https://www.thestreet.com/markets/stock-market-dow-jones-nasdaq-bond-yields-032221

 

Dec 09
0
President Elect Biden

Zach Abraham Discusses Biden Presidency with Investment News

By | Geopolitical Affairs, News, Stock Market

Financial advisors are navigating the uncertainty of Biden’s impact on markets and the economy, scrambling to prepare portfolios and client expectations amidst a cloud of uncertainty regarding taxes and economic growth prospects.

Several advisors weighed in with Investment News, including our founder and chief investment officer, Zach Abraham. Zach summed up the unprecedented environment by saying, “The stock market is really confusing a lot of people right now.”

“There is unequivocally a massive separation between the performance of financial assets and the underlying economy,” he added. “The markets started celebrating after the election because one party didn’t sweep it, there wasn’t a blue wave, and there wasn’t a Trump reelection that would make the cities burn.”

But, going forward from here, Abraham said the financial markets are expecting mountains of government stimulus to carry the economy until it can get past the COVID-19 pandemic and back to standing on its own.

“It is structurally impossible for this economy to perform at the level of 2019 at any point in the near future and asset prices will reflect that new reality without stimulus,” he said. “It will take some bumpiness in markets to wake up the politicians, but those guys aren’t afraid of spending.”

While some advisers are trying to help clients navigate the unknown of higher taxes, others are wondering if clients are becoming too complacent with a stock market that continues to defy gravity.

From a pure stock market perspective, most data show that U.S. presidents typically get too much blame for down markets and too much credit for up markets.

An analysis compiled by John Bernstein, founder of Bernstein Financial Advisory, which measured stock market performance in two-year election cycles dating back to 1928, found that the political party in power was only responsible for about 2% of the stock market’s total performance.

Read the full story here: “Financial advisers navigate the uncertainty of Biden’s impact on markets, economy.”

 

 

 

Jul 13
0

The Stock Market Rally: Zach Abraham Weighs In

By | Stock Market

Regardless of the pandemic, stocks closed near session highs on Wednesday, July 8, and Zach Abraham, Chief Investment Officer and Principal at Bulwark Capital, says that the Fed is largely responsible. The stock market is just not paying attention to corporate revenues or earnings right now.

Apple hit a record high after a Deutsche Bank analyst hiked his price target on the stock. Fellow tech giants Microsoft, Netflix and Amazon also saw gains even as the number of coronavirus cases in the U.S. hit a new single-day high. Twitter stock also rose as their hint of rolling out a subscription service led investors to speculate that the company might better be able to monetize their social media platform, which Zach says they need to do.

In fact, the Federal Reserve is not going to stop; they are the biggest catalyst of stock rises the U.S. is seeing across the board. The stock market rally we are experiencing could roll on a lot longer as the Federal Reserve pulls out all the stops, including purchasing corporate bonds, lowering interest rates to near zero, and expanding its Main Street Lending Program to allow more small and medium-sized businesses to be able to receive support.

 

Watch the whole interview here: https://cheddar.com/media/stocks-close-near-session-highs-as-apple-sets-record

Jun 04
0

Zach Abraham Weighs in On the EU’s Historic Coronavirus Stimulus Package

By | Geopolitical Affairs, Investments, Stock Market

Zach Abraham’s comments on the historic European Union’s $826 billion coronavirus stimulus package (750-billion-euro) were recently featured on both Bezinga.com* and Yahoo! Finance.

 

The European Union is proposing a ($824 billion) coronavirus recovery plan to assist the bloc with its recovery. The funds, as well as targeted reinforcements to the long-term EU budget for 2021-2027, will bring the total financial firepower of the EU budget to 1.85 trillion euros, according to the European Commission.

EU Must Evolve To Survive, CIO Zach Abraham Says

“While the EU relief package will certainly help things in Europe, it appears to be more of a stop gap measure and pales in comparison to actions taken by the U.S. government,” said Zach Abraham, chief investment officer and principal at Bulwark Capital Management.

“Although we are keeping a watchful eye on all ECN and EU relief measures, we are far more focused on recent comments by Macron and Merkel that point to a willingness or at least an openness to a tighter fiscal union.”

In Abraham’s view, the EU cannot continue as it is structured today.

“Either Germany will have to relent on ECB guidelines which restrict the central bank from applying unilateral QE and other forms of monetary stimulus (currently the ECB can only apply monetary stimulus evenly across all member countries) or more countries, specifically Italy and Spain, will be forced to leave.” This issue is far more critical to the economic prospects of the EU as a whole, the professional investor said.

++++++++++++++

Interestingly, Germany announced it was seeking a fresh $112 billion coronavirus stimulus package, just days after the EU launched its historic $826 billion plan: https://markets.businessinsider.com/news/stocks/germany-economy-112-billion-coronavirus-stimulus-rescue-plan-2020-6-1029271636

++++++++++++++

You can read the original articles here:

https://finance.yahoo.com/news/european-union-sets-750-billion-192730975.html

https://www.benzinga.com/news/20/05/16115773/european-union-sets-out-750-billion-euro-coronavirus-recovery-plan

* With an estimated unique monthly visitor count of almost 1.5 million, Benzinga is a news and analysis service that focuses on global markets. It provides original, accurate and timely global financial content and features articles from industry experts and experienced analysts.

Apr 28
0

Zach Abraham On April 17: ‘We’re Seeing a Bear Market Rally’

By | In The Headlines, Market Risk, News, Stock Market

Zach Abraham, Chief Investment Officer and Principal at Bulwark Capital Management, appeared on Cheddar.com again on Friday, April 17, live from the New York Stock Exchange, to discuss the effect that the coronavirus outbreak was having on stock markets. At that time, markets were at their highest point since March 10.

“Right now, the market is trading based on coronavirus news, which we think is a mistake. We equate it to focusing on a hurricane—nobody’s obsessed about when the hurricane will be over, the question is, what damage is left will be left in its wake?”

Zach went on to make the point that the market being up is, of course, a good thing, as is news of a potential vaccine being announced by Gideon, “We’re all cheering for that.” Also, he doesn’t have a crystal ball—no one does. But he urges caution since a vaccine could take 11 months or longer, and he encourages investors to start looking more closely at underlying market fundamentals being exacerbated by the coronavirus. “They’re bad, they’re really bad. You’ve got the S&P at a 22 price-to-earnings (PE) ratio going into the most severe economic shock in history. I’m just going to bet that doesn’t last; it’s not warranted.” Zach said he expects some potentially shocking earnings reports in the upcoming year from companies who simply cannot forecast sales accurately at this time, or what may happen with some of their divisions due to unpredictable future economic fallout.

Watch the full episode here: https://cheddar.com/media/stocks-close-higher-dow-hits-for-first-time-since-march

 

###

ABOUT CHEDDAR.COM

Cheddar is a streaming digital video service that broadcasts live from the floor of the New York Stock Exchange (NYSE) daily. Focused on business-minded millennials, the service highlights tech and consumer stocks while also covering the intersection of tech, media, news and culture.

 

Follow this link to the Cheddar.com web page: https://cheddar.com/media/stocks-close-higher-dow-hits-for-first-time-since-march

Apr 28
0

Zach Abraham: Coronavirus’ Effect on Cryptocurrency ‘Unpredictable’

By | Investments, Market Risk, News, Stock Market

Zach Abraham was recently quoted by Decrypt Debrief in their article, “Coronavirus, Bitcoin and the economy: what can we expect?”

Zach Abraham, Chief Investment Officer of financial services firm Bulwark Capital Management, agreed that the current economic situation is “incredibly unique,” and hard to predict.

“This is a different situation than 2008 but in some ways it’s much more unpredictable as the problems caused by excess are in every market,” he said. “The variables are endless and most of them aren’t looking too hot at the moment.”

You can read the full article HERE.

 

 

Mar 27
0

Zach Abraham Appears on Yahoo! Finance

By | In The Headlines, Investments, Stock Market

Zach Abraham, Principal and Chief Investment Officer of Bulwark Capital Management, appeared on Yahoo! Finance on March 13 to discuss the coronavirus outbreak and its impact on stock markets.

 

Back on March 13, the date of this interview, Seattle was the area of the United States hit first by the coronavirus—it was right on the front line with the COVID-19 outbreak. (Seattle is located about 34 miles from Bulwark Capital Management’s headquarters in Tacoma, Washington.) During the interview, Zach Abraham predicted at the time that people “might not be taking [the virus] seriously enough,” though the stock market certainly already was.

That afternoon, the government was expected to announce measures to help the economy, and Zach said that government intervention might stem the market sell off and help move markets to the positive. “We have a market that’s been fueled by the central banks’ intervention for the last decade, so there is a ‘Pavlovian’ psychological response built-in for that.”

But he warned about the long-term. “No one has a crystal ball, but one of the things we’ve been talking about for the last several years is that eventually the world is going to have to face some issues—something that more debt and printed money won’t fix.” For example, the drop in oil demand is just one example of how the corporate high-yield debt market could become a future negative factor for markets.

But with any economic crisis, It’s never just one thing or one issue at play. “I personally think that it will be at least a six- to eight-month timeline or longer to see the full effects of this market—to get economic clarity in terms of what the real backdrop is.”

 

Watch the full episode at this link:

https://ca.finance.yahoo.com/video/more-government-injects-more-movement-164456333.html

Mar 23
0

Stock Market Volatility: It Helps to Look Backward

By | Stock Market

Obviously, many of our clients are worried about the news, the headlines about coronavirus, and the drops in the stock market happening at the time of this writing.

As you know, our firm focuses a lot of attention on protecting your savings as you near retirement. But for some of our clients (depending on their unique circumstances), part of their portfolio—and/or part of their 401(k) or other retirement funds—are still subject to stock market risk. The reason for this is that based on historic return data: the stock market can offer the highest returns over time, and so might still be part of your overall retirement plan design.

The Stock Market Is a Long-Term Strategy

Some of our clients are all set with their retirement income plan, so their concerns are not for themselves. They are worried about their children and grandchildren, and how the stock market drops will hurt their loved ones’ finances.

We would like to remind everyone that it’s helpful to look backward.

The first market crash happened in Europe in 1634, when Dutch tulips bottomed out. (There’s a period movie called “Tulip Fever” that dramatized this one.) In the United States, the first major crash (and worst so far) happened in 1929. It took America 12 years to recover from the “Great Depression,” but we did recover, and went on to enjoy some of the greatest prosperity in our history.

But we’ve weathered more recent stock market collapses, too. Like the one in 1987 when “Black Monday” brought the largest single-day market loss in U.S. history. And there was the Dot.com bust of 2000. And of course, the “Great Recession” of 2008.

The thing is, historically every eight years or so we have experienced some sort of market correction. We were well overdue for this current market volatility; it’s been 12 years of experiencing primarily a bull market since 2008. Our firm has been talking with our clients about the possibility of a market correction for the last four years; indeed, we’ve been planning for it.

We view the stock market as just one of the tools in your financial planning arsenal—the tool with the longest timeline. To quote Warren Buffett: “The stock market is a device for transferring money from the impatient to the patient.”

In other words, although no one can predict the future, based on historic market performance your children and grandchildren probably have time to recover, and most likely, prosper. (This might even be a good time for them to pick up some bargains, depending on their circumstances.)

For you, if you do not have a retirement plan in place to help balance growth plus protection of your assets in volatile times, please call us. There are options to investing in the market.

Contact Bulwark Capital Management in Tacoma, Washington at 253.509.0395. We look forward to speaking with you!

 

 

Source: https://en.wikipedia.org/wiki/List_of_stock_market_crashes_and_bear_markets

Mar 20
0

Zach Abraham Discusses the Coronavirus Outbreak’s Impact on Markets

By | In The Headlines, Market Risk, Stock Market

Zach Abraham again appeared on Cheddar.com, a show broadcasting live from the New York Stock Exchange, to discuss the effect that the coronavirus outbreak is having on stock markets.

As the coronavirus spreads around the globe, it continues to drag down markets. Zach says one of the biggest misconceptions out there is that the coronavirus outbreak might be a transient threat. The central banks may not be able to stop the losses by “juicing” markets with more cash, because both the supply chain from China and the demand side from consumers are being hit.

There are anomalies all over the market when you examine the data; it’s not just the Treasurys we should be looking at. Corporations are at record levels of debt, which has tripled since 2007. And this debt is at its lowest quality in history, with over 50% of it rated lower than BBB. The spread between debt and earnings, as well as negative cash flows, are also of concern.

Watch the full episode here: 


 

###

ABOUT CHEDDAR.COM

Cheddar is a streaming digital video service that broadcasts live from the floor of the New York Stock Exchange (NYSE) daily. Focused on business-minded millennials, the service highlights tech and consumer stocks while also covering the intersection of tech, media, news and culture.

 

Follow this link to the Cheddar.com web page: https://cheddar.com/media/coronavirus-crushes-markets-outlook-for