Archive for July, 2014

WILBY & SARGEN: GLOBAL DANGERS TRANSCRIPT

July 25, 2014

Two veteran global investors, private investor Bill Wilby, formerly of number one ranked Oppenheimer Global Fund and Fort Washington Investment Advisors’ Chief Economist and Senior Investment Advisor Nick Sargen share their perspective and strategies on today’s market.

CONSUELO MACK: This week on WealthTrack, storm warnings! Two veteran global investors Bill Wilby and Nick Sargen are tracking rising geopolitical conflicts, central banks in uncharted territory and markets at record levels. What are their financial life saving skills telling them about the dangers ahead? Great Investor Bill Wilby and Fort Washington Investment Advisors’ Nick Sargen are next on Consuelo Mack WealthTrack.

Hello and welcome to this edition of WealthTrack, I’m Consuelo Mack. Markets are famously supposed to climb a wall of worry. And there are plenty of worries to go around right now. There are several geopolitical hotspots of strategic significance: Ukraine’s battle with Russian separatists, Israel’s battle with Hamas, Syria’s civil war, the terrorist group ISIS’ campaign in Iraq and Iran’s ongoing efforts to build nuclear bombs.

On the economic front: the uncertainty surrounding the Federal Reserve’s exit plan from its unprecedented monetary expansion of the past five years. The U.S. economy’s subpar growth during this recovery, and the struggling economies of Europe and Japan.

There are serious market concerns. Stock markets, particularly in the U.S. have been trading at record levels and bond prices are elevated. Despite all of these worries the markets have been relatively sanguine, with a few notable exceptions, since the height of the financial crisis five years ago. As you can see from this chart the widely followed Market Volatility Index, the VIX has been subdued for the last couple of years. Has this been the calm before the proverbial storm? We have two investment veterans with us who have kept their heads and portfolios through many market cycles and economic booms and busts.

Great Investor Bill Wilby is with us exclusively on WealthTrack. Now a Private Investor Wilby retired at the market’s peak in 2007- talk about timing- because he was distressed and concerned about the state of the financial markets. Until his retirement, Wilby was the former Portfolio Manager of the award winning Oppenheimer Global Fund which was ranked number one in its category for the 12 years he ran it. He also headed up the entire equity division of OppenheimerFunds. A graduate of West Point, Wilby also has a PhD in International Monetary Economics and has been a global investor for his entire professional life. He has held various international finance and investment positions at several top financial institutions including the Federal Reserve Bank of Chicago.

Nick Sargen is another lifelong global investor and was recently named Chief Economist and Senior Investment Advisor at Fort Washington Investment Advisors, the asset management arm of Western & Southern Financial Group. Sargen wanted to scale back from his previous position as the firm’s Chief Investment Officer. Sargen also has a PhD in economics and has been International Economist, Global Money Manager, Chief Investment Officer for several firms, as well as working at the Federal Reserve Bank of San Francisco.

I began the discussion with a Federal Reserve question: how is the great monetary experiment going to end?

NICK SARGEN: Thanks for such an easy question. I mean, that’s the one every investor wants to know the answer, and I would say, Consuelo, that the Fed is trying to reassure people and say, “Don’t you worry. We have all the tools that we need to handle this exit strategy, but I believe that this is unprecedented, and at the end of the day you have to make a choice as an investors, and it’s will the Fed begin tightening early or will it wait and be late? And my view is with this Fed it will err on the side of being later. So I think that the risk would be not immediately, but there would be a risk that if it waits too long and then inflation does come into the picture, then we might see some spike in bond yields, but that’ll probably be at least a couple of years away.

PREMIUM: WILBY & SARGEN

July 24, 20140 Comments

Global Dangers

How vulnerable are the markets? Despite rising geopolitical conflicts and uncertainty surrounding the Federal Reserve’s exit plan from its unprecedented monetary expansion, U.S. stock and bond markets are trading near record highs. Two veteran global investors, private investor William Wilby, formerly of number one ranked Oppenheimer Global Fund and Fort Washington Investment Advisors’ Chief Economist and Senior Investment Advisor Nicholas Sargen share their perspective and strategies.

Bob Doll – Market Oracle

July 18, 2014

ROBERT DOLL: MARKET ORACLE TRANSCRIPT

July 18, 2014

Bob Doll, Chief Equity Strategist and Senior Portfolio Manager at Nuveen Asset Management, has run several large cap stock mutual funds for three decades. We’ll get a personal take on his mid-year predictions for investment opportunities, and traps to avoid.

CONSUELO MACK: This week on WealthTrack, Nuveen Asset Management’s widely followed market oracle Bob Doll consults his sources of financial wisdom to conjure up a market view and build multiple mutual fund portfolios. Great Investor Bob Doll is next on Consuelo Mack WealthTrack.

Hello and welcome to this edition of WealthTrack, I’m Consuelo Mack. Indexing and quantitative investment pioneer Dean LeBaron once said that “Forecasts can be injurious to your wealth”. The late legendary financial historian Peter Bernstein insisted “the future is unknowable, the future is unknowable, the future is unknowable” several times on WealthTrack. But that doesn’t mean that we won’t or shouldn’t try to figure out what might happen of that the exercise isn’t helpful to the investment process. This week’s WealthTrack guest has made a name for himself with his annual predictions and with his investment skill running several large cap stock mutual funds for three decades.

He is Robert Doll, an original member of the WealthTrack brain trust who is now the Chief Equity Strategist and Senior Portfolio Manager at Nuveen Asset Management. Previously he was the Chief Equity Strategist at BlackRock, and the Chief Investment Officer at Merrill Lynch Investment Managers, as well as its President. In addition to writing his widely followed weekly commentaries and annual market predictions he has been the portfolio manager of several leading large cap mutual funds throughout, a job he resumed last year at Nuveen. His Nuveen Large Cap Value, Growth and Core Funds have all outperformed the market and their peers in the year he has been running them. Doll recently reviewed the status of his ten 2014 annual predictions.

Here’s a quick mid-year update on most of them.
–His forecast of 3% economic growth is still a dream, not a reality, but he is looking better on housing improving and hit it on the nail with private employment setting an all-time high.
–10-year treasury yields have not moved up toward 3.5%. They have remained under 3%.
–U.S. equities are having a good year so far, although we have yet to see Doll’s 10% correction.
–Cyclical stocks have not outperformed defensive ones- the opposite has happened.
–Dividends, stock buybacks and merger and acquisitions have definitely taken off, corporate capital spending has not.
–The dollar hasn’t appreciated much this year but U.S. energy production and manufacturing are booming.
–Contrary to his expectation that gold would fall and commodities would languish, they have appreciated.
–Municipal bonds have outperformed taxable bonds by a wide margin.
–The jury is still out on whether active funds will outperform index funds. So far the performance is

We will have to wait until November to gauge Doll’s prediction that the Republicans increase their lead in the house but fall short of capturing the Senate. I began the interview by asking him which of his current market predictions matter most to investors.

BOB DOLL: Given that I’m an equity guy, Consuelo, I start with the one, stocks have a good year. I think that’s the one that’s most important, and year-to-date so far, so good. In fact, stocks have probably done better than most people thought on January 1st.

TAKE SOME PROFITS IN YOUR TOP PERFORMERS OF THE LAST FIVE YEARS

July 18, 2014
  • Sell a percentage of funds or stocks that have delivered biggest gains
  • Reinvest in lagging sectors or funds, or keep in cash

Watch the related WEALTHTRACK episode.

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