Monetary Systems and Market Commentary by Cullen Roche
Cullen Roche: Current SPX drawdown presented for historical perspective
The current drawdown of the S&P 500 Index (SPX) has been presented for historical perspective. Cullen Roche drew attention to this comparison, noting that viewing a chart of SPX drawdowns going ...
Global stocks have outperformed real estate recently, Cullen Roche notes
Cullen Roche described current U.S. real estate prices as making the market a poor investment, calling being priced out of the market a blessing in disguise. Roche added that global stocks have ...
Cullen Roche: Sovereign debt crisis subsides as focus shifts to private debt
Cullen Roche stated that the sovereign debt crisis is no longer a concern, but cautioned that attention will now turn to issues surrounding private debt. ...
Top 20% covered 70% of all federal taxes in 2022, Cullen Roche notes
CBO data for 2022 indicate that the bottom 20% of income earners paid an average federal tax rate of 1.4%, while the top 1% paid 31.5% and were responsible for 27% of all federal taxes. The top ...
Cullen Roche: Markowitz portfolio selection theory defined modern asset management in 1952
Harry Markowitz published "Portfolio Selection" in 1952, introducing the concept of optimizing a diversified basket of assets along an efficient frontier—a framework that became foundational for ...
Online sources often misreport price returns, Cullen Roche notes
Cullen Roche advised that searching for price returns online typically leads to inaccurate results, specifically citing Yahoo Finance unless using historical data with the adjusted price column. ...
Cullen Roche: Debate on passive investing challenged 14 years ago
Cullen Roche said that 14 years ago he published an article questioning the existence of passive investing. Roche described how his argument at the time drew significant reactions from some ...
Webinar will explain asset-liability matching for retail investors, Cullen Roche says
A webinar hosted by Fidelity is scheduled for tomorrow at 12PM ET, focusing on how retail investors can implement an institutional-style asset-liability matching strategy. Cullen Roche announced ...
Cullen Roche: Median family net worth rose 91 percent since 2013
Cullen Roche highlights that a new Survey of Consumer Finances was released today. According to Roche, the inflation-adjusted median family net worth has increased by 91 percent since 2013. He ...
Valuations help assess sequence of returns risk, Cullen Roche argues
Cullen Roche shares insights from his latest research, challenging the common belief about the usefulness of valuations in market timing. According to Roche, while valuations are a poor tool for ...
Cullen Roche: U.S. bond market crisis fears as USD index rises and stocks hit highs
Cullen Roche questions forecasts of an impending U.S. bond market crisis, pointing out that instead of declining, the U.S. dollar index is moving higher and U.S. stocks are achieving new highs. He ...
Inflation declined to 2.3 percent after rate increases in 2022, Cullen Roche notes
Cullen Roche questions whether a regime of fiscal dominance exists in the current environment. He points to 2022, when inflation peaked at 9 percent but dropped to 2.3 percent after the Federal ...
Cullen Roche: AI will not trigger agentic bank run due to financial system safeguards
Cullen Roche humorously explores the potential for artificial intelligence to drive what he terms the 'Agentic Bank Run'. He imagines a scenario where a user asks an AI assistant to optimize ...
The risk of AI agents triggering mass cash movements is exaggerated, Cullen Roche argues
Cullen Roche challenges the narrative of imminent AI-driven bank runs. He contends that claims suggesting artificial intelligence agents will rapidly move household cash from low-interest checking ...
Cullen Roche: Debt to GDP ratios offer little predictive value for developed economies
Cullen Roche challenges the common belief that high debt to GDP ratios are a significant risk for developed world sovereigns. He states that research cited to support this claim often ...
10 year bond yield at 5% is still under the historical average, Cullen Roche notes
Cullen Roche observes that despite concerns in the bond market, current conditions are influenced by recency bias. He points out that since 1960, the 10 year yield has averaged 5.8%, while today ...
Cullen Roche: Inflation is key driver of bond yields and Fed rate policy
Cullen Roche argues that the bond market and the Federal Reserve are both engaged in predicting long-term economic trends. Roche explains that the bond market tries to forecast the path of the ...
AI investment outlook is bearish while delayed extinction is bullish, Cullen Roche notes
Cullen Roche comments that the pace of investment in artificial intelligence is expected to slow, describing this as a bearish development. However, Roche also suggests that the risk of human ...
Cullen Roche: High inflation periods have greater negative impact on bonds
Cullen Roche examines the effects of inflation on bond performance. He observes that, while recent history has been challenging for bonds, sustained periods of high inflation tend to be even more ...
Cash drag costs $500,000 annually and liabilities duration gap exists, Cullen Roche warns
Cullen Roche highlights a financial issue involving cash drag, stating that Mr. Ross is losing roughly $500,000 each year in missed T-Bill interest. He adds that Treasury coupons are exempt from ...
Cullen Roche: Criticism of U.S. government bond crisis predictions over decades
Cullen Roche comments that predictions of a crisis in U.S. government bonds have been ongoing for 40 years. He questions whether it is artificial intelligence or longstanding narratives that ...
