British Invasion
Today’s blog is a tribute to the British Invasion, a phenomenon that swept across America in the 1960’s bringing great pop/rock music for our listening pleasure. Why? Because “It’s My Life and I can do what I want” (The Animals), or more precisely it’s my blog and I can write what I want. The idea was initiated by my associate, Liza, who attended a lively and informative discussion with me featuring a portfolio manager and an analyst from a widely respected investment firm this week. Timely views about investment opportunities are always welcome, - “All Day and All of the Night” (The Kinks).
“You can’t always get what you want” (The Rolling Stones), but now is a good time to travel to Europe as the dollar will buy more than normal. Perhaps more importantly, this portfolio manager also mentioned it may be a good time to invest overseas as dividends are significantly higher than in the US, and international stocks are, in general, cheaper. He did not share much of his investment views on China, nor the “House of the Rising Sun” (The Animals).
Changing topics, when asked how long interest rates would keep rising this portfolio manager stated in so many words “You Really Got Me” (The Kinks). The analyst, on the other hand, said investors have gotten “Tired of Waiting” (The Kinks) for the Federal Reserve to stop raising interest rates, and may have done the Fed’s work, demanding higher rates all across the yield curve. If you are not aware, both short and long rates have lifted dramatically since July. Higher rates hurt businesses yet help investors. But “Don’t Let Me Be Misunderstood” (The Animals), predicting interest rate peaks can be very humbling. “There’s a Kind of Hush” (Herman’s Hermits) from the Fed about peak rates, if you ask me.
In our equity markets, volatility has continued. AI has been the “Wild Thing” (The Troggs) that fascinates investors. Even though AI is transformative, the analyst warned that investors have priced a lot of future earnings into many of the AI stocks. As for other technology trends to recognize, he did not say “Get off of My Cloud” (The Rolling Stones). Rather, he cited cloud computing as further evidence that the US is still the center of global innovation.
One participant at this discussion asked about the rapid changes in building client portfolios. You could almost hear him crying “Where Have All the Good Times Gone?” (The Kinks). The portfolio manager agreed and pointed to his receding hairline as proof, and then laughed. A song popped into my head, “Here Comes My 19th Nervous Breakdown” (The Rolling Stones). Yes, building client portfolios today is different and challenging, “A Hard Day’s Night” (The Beatles), but with diligence, patience, knowledge and care a portfolio will “Come Together” (The Beatles) and client goals can be achieved. And I really believe that. As much as I like the song “I Can’t Get No Satisfaction” (The Rolling Stones), this is not the refrain investors need to be singing.
P.S. Enjoy the playlist!
Ralph McDevitt 10/19/23
Any opinions are those of Ralph McDevitt and not necessarily those of Raymond James. This material is being provided for informational purposes only and is not a complete description, nor is it a recommendation. Investing involves risk and you may incur a profit or loss regardless of strategy selected. Past performance is not indicative of future results. Raymond James & Associates, Inc., member New York Stock Exchange/SIPC
International investing involves special risks, including currency fluctuations, differing financial accounting standards, and possible political and economic volatility. Dividends are not guaranteed and must be authorized by the company's board of directors.
