Editor’s note: this article was originally published by Pring Turner Capital Group on October 5, 2016. Opinions and data are current as of then. It is republished here with permission.

Summary

This update focused on the challenges facing investors. Retired investors are especially challenged to both protect and grow their portfolios in today’s low return world.  We started by highlighting the dual challenges of high stock market valuations coupled with record low interest rates. The current starting point today of near record high equity valuations points to low future investment returns.  Investors and savers are also challenged by the fact yields have never in America’s 240-year history been as low as they are currently!

Martin Pring shared his analysis of the economy and financial markets.  He likened the economy to an auto

“Doing what we already know how to do takes the world from 1 to n, adding more of something familiar. But every time we create something new, we go from 0 to 1. The act of creation is singular, as is the moment of creation, and the result is something fresh and strange.” – Peter Thiel, Zero to One

Two roads diverged: one takes you from 1 to n and the other from 0 to 1.

On which path is the asset management industry headed?

If we’re being honest, the answer is clear. It’s on the road from 1 to n and has been for some time now. Technology and intense competition are driving down fees at an accelerating pace. There is no sign of this trend abating anytime soon and no economic rationale why it should. If this continues, we will eventually reach a state of “perfect competition,” where in the long run no company

Editor’s note: This article was originally published at Bija Advisors. The author presented a webinar for MTA members, Better Decisions, Better Results: Using Cognitive Science to Gain a Competitive Edge, which can be viewed here.

Since 2000, Bill Belichick is far and away the most successful coach in the NFL. Having won slightly more than 80% of their last 200 regular season games, his team, the New England Patriots are head and shoulders above the competition. They are the reigning Super Bowl champs for a fourth time under his leadership, have won 22 playoff games and are on track to easily win their division again this season. The results speak for themselves, but when compared against the other 31 coaches in the league they are simply astounding (see chart below).

In fact, his record is so spectacular that many have resorted to accusations of cheating, seeing no other way to

The Market Technicians Association (MTA) is a dynamic association focused on building a strong community of market professionals, maintaining the highest ethical standards in the industry, and promoting the use of technical analysis in the investment process. Participating in the leadership of an organization like the MTA can be a deeply rewarding experience. It is an opportunity to work closely with industry leaders, to significantly further the mission of the MTA, and to have a real impact on technical analysis in the financial industry. You will also find the experience to provide great opportunities to improve yourself both personally and professionally.

So what is actually involved in serving on the MTA Board? What qualities should you look for when nominating other members? Is this a good role for you personally? Here are the expectations of MTA Board members, which I have boiled down to the “5 P’s.” An MTA Board member

Each of the following charts contains three components.

• The Index in the top panel 
• The Bullish Percent Index in the second panel
• The % of stocks above the long term 200 day average in the lower panel

What I find particularly important about these 3 as a group is they help you stay long the market while everything is working. However, when they start to disagree, it is time to be aware of the potential for change.

The Bullish Percent Index has been calculated by StockCharts.com as one of the early indicators of breadth based on Point And Figure charts. This index calculates the % of stocks on a buy signal. On a PnF chart, you are either on a buy signal or a sell signal, but the distance between the two levels can be significant. If the market has made a recent high, it is bullish until it makes a lower low. Then it goes on