Womack Investment Advisers

As the bull market continues through its ninth year, a little-known stock market indicator with a “5 for 5” record since 1895 has just generated a sell signal.  The indicator is the creation of Gray Cardiff, editor of the Sound Advice newsletter.  He calls it the “Sound Advice Risk Indicator”, which is simply the ratio of the S&P 500 to the median price of a new home. Cardiff explains that the indicator quantifies the “struggle for capital” between stocks and real estate. When the indicator rises above 2.0, he explains, it means the stock market has absorbed a “larger proportion of available investment capital than economic conditions can justify.” The last time the indicator flashed a sell signal was in 1998—conveniently before the dot.com implosion that followed.  However, this indicator did NOT give a sell signal in 2007, since it was Real Estate that had proportionately too much investment then!

 When CNBC asked business author Suzy Welch how someone should ask for a raise she explained, “The key…is an approach that includes research and emphasizes your achievements.” She recommended three basic steps: 1.       Time your request right. Ask after a big win, a positive performance review, or when being asked to accept more responsibility. 2.       Prove your case. Be prepared to explain why you deserve a raise, including your achievements and results. 3.       Establish a time frame for action. If your boss isn’t prepared to provide an answer immediately, end your meeting by asking when you can expect a response. This is sound advice. When Willy Appelman of Fast Company asked children at the Underhill Playground how they would ask a boss for a raise, the kids believed the keys to success were good manners, hard work, baked goods, and physical appearance. Here are some of thei...

Tick, Tock. Not everybody loves meetings and even fewer enjoy reading the minutes, but investors make an exception with the Federal Reserve. This week the Fed published the minutes from its August 1 meeting. While no changes were made to interest rates, the minutes did provide insight to how the Fed sees the U.S. economy. Key Insights: The economy is strong. The economy is poised for its best annual growth in a decade due to stimulation from tax cuts and federal spending. The current nine-year bull market is about to be the longest bull market in history and the stock market hit a new high last week. Inflation is back to the 2 percent range, after missing for several years, and the already tight labor market continues to tighten, reported The Wall Street Journal . While the Fed remains concerned about the risks of inflation, it also is concerned about slowness in the housing market. Home building has declined due to a labor shortage and to higher cost in materials ...