Angeles Advisors | Blog

  • Blog posts are written by Angeles' CIO Michael Rosen

    Michael has more than 30 years experience as an institutional portfolio manager, investment strategist, and investment consultant.

    READ MORE

It’s About Time

By

“Lost Time is never found again,” advised Benjamin Franklin in Poor Richard’s Almanack. And Dante Alighieri observed, “The wisest are the most annoyed at the loss of time.” I have been thinking about replacing my seven year-old car, which has me reflecting on the notion of Lost Time. Americans average 42 hours per year in rush hour traffic, but of course, in Los Angeles it’s much more. We each sit in rush hour 104 hours per year, the worst in the world (all data here come from the definitive source of global traffic data, INRIX Research). Moscow, New York, San Read More


For What It’s Worth

By

In the summer of 1966, throngs of young people crowded the Sunset Strip in Los Angeles to hear their favorite bands. Over at the Sunset Tower, Jim Morrison and the Doors were the house band, finishing up their first album (The Doors, with Light My Fire, and Break On Through, among other classics). Not to be outdone, a former policeman from Chicago, Elmer Valentine, opened the Whisky-A-Go-Go, featuring dancers in mini-skirts suspended in the air in a cage, thus inventing the Go-Go dancers. The Whisky also had a house band working on their debut album. The year before, 1965, the Read More


Toes in the Sand

By

For me, and I think I speak for everyone on the planet, the feeling of warm sand between the toes is one of life’s great pleasures. And for virtually everyone on the planet, including those of us who look at a beach every day (ok, I may be rubbing it in), we don’t give sand much thought: it’s just there. But sand is more than pretty beaches; it’s big business. And it’s gotten to be even bigger business with the advent of the Shale Revolution. That’s because a lot of subsurface rocks that contain oil and gas lack permeability, which Read More


Not Dead Yet

By

According to the National Bureau of Economic Research (NBER), the self-acclaimed arbiter of economic debate in this country, the current economic expansion began in June 2009, meaning we just passed eight years of uninterrupted growth. This is now the third longest period of economic growth since the Civil War (see chart below). In May next year, we will pass the second-longest expansion, and if we can get to the summer of 2019 without a dip, we’ll have a new record. Will we get there? And does it matter? The answers are, probably and yes. To answer the first part, we Read More


Humans! What Are They Good For?

By

It looks like the world is turning against humans. I’ve talked before about the rise of robots in manufacturing (2016 Angeles Independent School Endowment Symposium…see graph below). But robots are taking on increasingly more complicated tasks. We may be comfortable with robots assembling our cars (although the UAW may take exception), but most us will soon be forced to shift our perception of our family physician from Robert Young (aka, Marcus Welby, MD, which is showing my age) to Da Vinci (no, not Leonardo…see photos below). The Rise of Robots, The Descent of Humans It seems that investors, too, have Read More


Beware Parabolas and Populists

By

In scouring the world for investment opportunities, the chart above caught my attention. It shows the year-to-date performance of the Caracas stock exchange, more than tripling from around 30,000 to over 100,000 today. Did we miss a chance to make a lot of money? Well, no. The stock market has tripled because the currency has lost all value. The official USD exchange rate of the bolivar is 10:1; 10 bolivares buys 1 US dollar. But the official exchange rate is a fantasy: the actual exchange rate is 7,500:1 (see graph below from www.venezuelaecon.com). That’s a 75,000 percent depreciation from the Read More


Economics in Action

By

The intersection of supply and demand determines price and quantity: there is no more fundamental principle of economics (see graph below). We rarely see this principle in action because prices for most consumer goods and services change little week-to-week. All that means is the market maintains a constant equilibrium (which is set by the price) of supply and demand: either there is little change in supply or demand, or the changes are very modest, and market forces adjust quickly to maintain that equilibrium. Commodity prices are much more volatile than consumer goods prices, meaning there are frequent “shocks” either to Read More


Job Growth is Falling. The Sky is Not.

By

Today’s jobs report was disappointing: only 138,000 net new jobs created in May (the consensus had it pegged at 182,000), another 66,000 lost in revisions to the prior two months, the three-month average is trending lower with declines across all industries. Oh no! Treasury yields plunged today to the lowest levels since November, erasing all of the move following the election. Let’s look at the employment data more closely. The first graph below shows the monthly change in non-farm payrolls over the past five years. The series is volatile, and the May print is below the average of this period, Read More


Hope and Reality

By

Why is everyone so happy? Well, maybe not everyone, but a lot of people are as optimistic as they’ve been in a long while. Start by looking at consumer confidence, as collated by the Conference Board below. Confidence is at the highest level in the past five years (see graph below); in fact, confidence is only a little shy of its all-time peak in September 2000 (which, ominously, marked the top of the great Internet bubble). Conference Board Survey of Consumer Confidence, 2011-2017 One finds the same results in nearly all the surveys, from consumers to small businesses to baseball Read More


Chasing the Red Baron

By

You can’t eat relative returns is an old aphorism. It sounds like it could come out of Poor Richard’s Almanac (Benjamin Franklin), and I’m not really sure of its origin, but it means that we (investors) ought to be focused on the absolute growth of our money, not on its growth relative to some benchmark or peers. When we buy groceries (or make grants or award scholarships or cut pension checks), we spend (“eat”) actual dollars, not an amount relative to our performance against an index. Too often, we fall into the trap of trying to copy the strategies of Read More