Take Advantage of Shift From Bonds to Stocks

For several years, investors have anticipated a “great rotation” from bonds into equities, and for several years, they were dead wrong. In fact, even as equities were quietly rising for the past years, both domestic and international money has continued to surge into bonds. At long last, that is beginning to reverse, which demands a reconsideration of strategies that seemingly have worked so well and so easily for so long. As long as bond prices were rising, pouring money into assets that had a certain return looked like a slam dunk. No longer.

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It’s Not Just Trump. People Freaked out Over Nixon and Reagan, Too.

Donald Trump’s election has been greeted by a considerable portion of the country with panic. Large swaths of commentators have described his victory as a potential disaster for the nation — placing a “xenophobic racist” and “clown” in the Oval Office. One Hillary Clinton supporter outside her hotel in New York the morning after the election said, “I’m feeling physical pain. I’m shocked. I’m sad.” 

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Wrong Number

The press didn’t see it coming. Or did they? This week, we examine the role of data – and delusion – in this election. Nate Silver reflects on the promise and pitfalls of polling, and Zachary Karabell discusses how financial indicators gloss over the gritty realities of American life. Plus: how a plan to dismantle the electoral college could make elections more democratic, and election coverage more interesting.

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The GOP is Breaking. It’s not Trump’s Fault.

We now have something like consensus: The rise of Donald Trump portends the end of the Republican Party as we know it. As longtime GOP operative and commentator Steve Schmidt said last week, “The Republican Party has an outstanding chance of fracturing.” Trump’s opponents, inside and outside the party, are united in the belief that he has almost single-handedly undone an institution founded on the eve of the Civil War that has lasted for more than 150 years and has immeasurably shaped the United States.

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Making the Most of a ‘Placid’ Market

At long last, the presidential election of 2016 is entering its final stages. In one form or another, this election has occupied an outsized place in American life since the middle of 2015, by far the longest and most extensive political campaign we’ve ever experienced. Much of this campaign season’s noise will have little impact on markets, the economy, interest rates, economic growth, or the fate of companies. In many respects, there is an inverse relationship between the furor of this election and its clear impacts—particularly if Hillary Clinton and the Democrats win.

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Diversification is the Winning Ticket in 2016

Recent volatility notwithstanding, what has been striking about 2016 as an investing year is how relatively good it has been. In fact, the return on a diversified portfolio this year is competitive with many major asset classes, and has restored (for now) some confidence in the age-old mantra of diversification being among the most prudent of investing strategies.

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