• Investors should remember that excitement and expenses are their enemies. And if they insist on trying to time their participation in equities, they should try to be fearful when others are greedy and greedy when others are fearful.

    Warren Buffet

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Capital Market Review

Iron Capital’s quarterly review of capital markets performance and updated market forecast.


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  • Capital Market Review
  • January 2022
  • Iron Capital Advisors

Fourth Quarter 2021

What is the real rate of growth? GDP growth rebounded in the 4th quarter of 2021. After slowing to 2.3 percent in the third quarter, the initial reading for 4th quarter is 6.9 percent. Does that mean we are back to the solid growth of earlier this year? It doesn’t feel that way.


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  • Capital Market Review
  • October 2021
  • Iron Capital Advisors

Third Quarter 2021

All I want for Christmas is for my presents to actually arrive! The combination of Covid shutdowns, stimulus payments, and a lack of workers returning to the workforce have created a nightmare of supply chain logistics.


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  • Capital Market Review
  • July 2021
  • Iron Capital Advisors

Second Quarter 2021

I have said it a thousand times if I have said it once, but the real indicator of how the market feels is not the headline index return, but what is happening under the surface.


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  • Capital Market Review
  • April 2021
  • Iron Capital Advisors

First Quarter 2021

Great expectations often lead to disappointment. No, I’m not talking about the Dickens novel – Pip would never disappoint. I’m talking about real life. We are in the midst of an economic recovery from the reaction to Covid-19, and expectations are getting great.


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  • Capital Market Review
  • January 2021
  • Iron Capital Advisors

Fourth Quarter 2020

“To everything there is a season, and a time to every purpose under the heaven.”
The season will change, value is coming.

  • What is the real rate of growth? GDP growth rebounded in the 4th quarter of 2021. After slowing to 2.3 percent in the third quarter, the initial reading for 4th quarter is 6.9 percent. Does that mean we are back to the solid growth of earlier this year? It doesn’t feel that way.

    While 6.9 percent seems like healthy growth, we must factor in that inflation is 7 percent. Also, when you average the 2.3 percent and 6.9 percent, the second half grew at 4.6 percent versus over 6 for the first half. Is it any wonder that people do not feel as if the economy is doing well?

    Factor into that 6.9 percent growth the fact that more than 4 percent of that was inventory-building, and the picture becomes a little bleaker. Most of the activity last quarter was simply companies getting their supply chains sorted.

    This puts the market in a quandary. Earnings will be strong, at least in nominal terms, while real growth continues to slow. In the long term company earnings should win out, but in the short haul, markets are likely to be choppy.

    To read the full report, please download the PDF.

    ~Fourth Quarter 2021

  • All I want for Christmas is for my presents to actually arrive! 

    Supply chain issues weigh on the global economy. It has been reported that 90 ships are in queue outside of Los Angeles, and more than 20 ships are backed up outside of Savannah, GA. Orders online that we are accustomed to receiving the next day, they now say will ship in three weeks.

    The combination of Covid shutdowns, stimulus payments, and a lack of workers returning to the workforce have created a nightmare of supply chain logistics.

    In the meantime, we have the combination of high inflation and dramatically slowing economic growth. The US economy has gone from growing at a rate of 6.5 percent all the way down to 2 percent in a matter of months.

    This is a strange economic soup, but the greatest concern is likely inflation. This means that stocks should be the best place to be as they are the best hedge against inflation. We could see an environment where the economy limps along, but the stock market does well.

    Inflation hurts consumers and destroys savers but can actually helpinvestors. Even though we are investors, this is not a good situation for the long haul.

    To read the full report, please download the PDF.

    ~Third Quarter 2021

  • That is a full two-point deduction, which is a little more than simply not sticking the landing. This is a huge disappointment.

    The first reading of second quarter GDP came in at 6.5 percent. That would be fantastic under normal circumstances, but there is nothing normal going on right now. Expectations were for 8.5 percent and that had already been lowered from 9 percent.

    I have said it a thousand times if I have said it once, but the real indicator of how the market feels is not the headline index return, but what is happening under the surface. While the broad indices have held up, underneath the surface we have had a rotation. Smaller company stocks, as measured by the Russell 2000, have underperformed, as have value stocks. Large-growth stocks have come back.

    Investors now go towards these large technology firms when they believe there is no growth to be had anywhere else. These high-fliers have somewhat ironically become today’s defensive stocks. The market has gone from telling us that we are going to grow exponentially to saying we are headed for a recession. The market exaggerates.

    What was overly optimistic just a few months ago, has become overly pessimistic.

    To read the full report, please download the PDF.

    ~Second Quarter 2021

  • Great expectations often lead to disappointment. No, I’m not talking about the Dickens novel – Pip would never disappoint. I’m talking about real life.

    We are in the midst of an economic recovery from the reaction to Covid-19, and expectations are getting great. The Fed has said it foresees 6 percent economic growth. When most people hear that they probably celebrate, but when I hear that I immediately think:  We could grow at 5.5 percent and Wall Street will be disappointed.

    The Fed has kept the gas pedal to the floor and says they no longer care about short-term inflation but will keep the money loose until people get back to work. At the same time, the administration and Congress are passing relief packages seemingly designed to stop people from going back to work. These policies have the potential to lead to permanent higher unemployment and easy money, which could lead to inflation. The Producer Price Index, which tracks wholesale prices, is up more than 4 percent over the last year, and the recent reading for the Consumer Price Index was 2.6 percent – more than half a percent higher than the Fed’s long-term target.

    Is inflation solely a monetary policy issue, or is it the combination of loose monetary policy with big government spending? I don’t know the answer, but this is a question that must be asked.

    To read the full report, please download the PDF.

    ~First Quarter 2021

  • “To everything there is a season, and a time to every purpose under the heaven.” Ecclesiastes 3:1

    Yes, that is right, this is not just a song by The Byrds, it is scriptural wisdom, and whether one learned it in Sunday school or by singing along to the radio it is just as true. For what seems like years now, we have been talking about the market’s unhealthy skew towards large growth companies.

    The rising tide has not lifted all ships and investors who buy value stocks, or the stocks of smaller companies and those headquartered overseas have seen little in the way of growth.

    Some of our clients have even taken to making fun of me (to my face – they always make fun of me behind my back) because of my insistence that this will pass. The season will change, value is coming. Not only has my tune not changed, but we may have already seen the change.

    The trigger for this season change appears to be Wall Street’s hope for stimulus. The focus on the word stimulus was translated economic growth. We have seen false starts in this transition before, and it is possible that is all the last four months have been. These larger trends do however go on for years, and lately a decade seems to be the life span. “To everything there is a season…a time to plant, and a time to pluck up that which is planted.” We appear to be in the time to plant some diversification.

    To read the full report please download the PDF.

    ~Fourth Quarter 2020