FYI:
Regards,
Ted
May 30, 2019
How concerned are you about stock market risk? The S&P 500’s five percent plus slide this month has not been a confidence builder.
Speaking at the Economic Club of New York today Federal Reserve Vice Chairman, Richard Clarida reiterated the Fed’s views that the U.S. economy is in good shape but said “if we saw a downside risk to the outlook, then that would be a factor that could call for a more accommodative policy.”
Since the Fed’s last meeting on April 30-May1 when Fed officials voted to maintain their current no move policy, trade tensions between the U.S. and China have worsened, global growth has shown more signs of slowing and interest rates have declined. A phenomenon known as the inverted yield curve (where long-term interest rates represented by the 10-year Treasury note fall below short-term ones represented by 3-month Treasury bills) has reappeared and caused increased speculation about Fed interest rate cuts and recession. If the inverted yield curve were to persist for a quarter or so it would be considered a serious harbinger of recession.
One of the most shocking and intriguing insights shared by this week’s WEALTHTRACK guest David Giroux, Head of Investment Strategy at T. Rowe Price is that 31% of S&P 500 companies are being disrupted by secular risks which threaten their long-term topline and earnings growth. And the number of companies affected is increasing. A huge source of the risk is changing technology. A large group of T. Rowe Price’s portfolio managers and analysts recently returned from the firm’s annual trip to Silicon Valley where they pick the brains of top executives of leading tech-oriented companies. The firm is sharing its findings with us in their recently published report, “Technological Innovation and Disruption.” It’s a fascinating read that you’ll find in our EXTRA feature on wealthtrack.com this week.
During public television’s spring pledge fund raising drive we are revisiting our recent exclusive interview with Giroux, who is also Portfolio Manager and Chairman of the Investment Advisory Committee of T. Rowe Price Capital Appreciation Fund which is a Morningstar Gold Medalist and carries a Five-Star rating. Giroux was named Morningstar’s Allocation and Alternatives Fund Manager of the Year in 2017, the second time he was so honored and has been nominated for the award several other times.
If you miss the show on television due to pledge programming changes you can always find it on our website. As always, we welcome your feedback. Click on the Contact Us link on our website, or connect with us on Facebook or Twitter.
Thank you for watching. Have a lovely weekend and make the week ahead a profitable and a productive one.
Best regards,
Consuelo
https://wealthtrack.com/how-david-giroux-delivers-stock-market-performance-with-much-less-risk/
