December 27, 2013

December 16, 2013

Visit to Silicon Valley

Recently I had the privilege of visiting several companies in the heart of Silicon Valley. I returned from my trip convinced that the United States is not finished, despite what so many commentators say.

In that vibrant land of virtual environments and mobile apps, we can observe yet another transformation of US society. Like earlier dynamic periods in history, this one has been brought about by intellectual innovation and free-market experimentation. Just drive down Highway 101 from San Francisco, alongside the young technology workers on commuter buses, and see the expansive corporate campuses lined up one after another.

December 2, 2013

To invest or not to invest in 2014? That depends on what is yet to come

  • Recent data on US jobs and economic growth have surprised on the upside, and better news has come out of Europe.
  • Corporate productivity and profitability, housing affordability, pent-up demand and population growth have all supported the US economy.
  • As the cycle extends into 2014, we expect to see more benefits from falling energy prices and rising global growth.
  • The competitive cost structure of US manufacturing has held margins steady as revenues have revived.
  • While current valuation metrics are mixed, whether equities turn out to be overvalued will depend on earnings growth going forward.