What a Greek bankruptcy means to your investment portfolio

greek_bankruptcyA potential Greek bankruptcy has dominated the headlines over the past couple of weeks and this Sunday is a crucial referendum to decide their fate. The Greek PM Alexis Tsipras today urged its citizens to reject an international bailout deal. Many economists and investors are now expecting a bankruptcy in the near term. The big question for investors is: what does a Greek bankruptcy mean to my investment portfolio?

IMF urges Fed to delay interest rate hike until 2016

Yellen_LagardeThe International Monetary Fund urged the Federal Reserve to wait until the first half of 2016 to start raising short-term interest rates because the U.S. economy remains subpar. This is an unprecedented event as I can't recall a time that the IMF has ever tried to influence Federal Reserve policy. The IMF predicted the economy will grow 2.4% this year, down from its April forecast of 3.1% and the second time it cut growth targets this year.

The invisible hand of central bankers and government intervention


The financial markets are guided by supply and demand conditions for stocks and bonds. Historically, their fluctuations have been heavily influenced by business conditions and economic cycles. During the past 12-15 months something new and different has dominated the marketplace. Unorthodox governmental forces are the engine that drives the financial markets which seem totally insensitive to any negative economic developments.

Central bankers are giving out easy money

"I want theasy_moneye easy
Easy money
Easy money
I want the good times
Oh, I never had
I want the easy
Easy money
I want the good life
I want it bad"  -- Billy Joel

Will the Fed raise rates in 2015? Don't count on it

janet-yellen-deflationYesterday, the Federal Reserve removed its "patient" language, as expected, but Fed Chair Janet Yellen delivered her best quote yet:

Just because we removed the word 'patient' from the statement, doesn't mean we're going to be impatient.

With many investors still expecting a first rate increase in 2015 (perhaps in September), you shouldn't count on it. Why? It's actually quite simple. Yellen repeatedly tells the market that the Fed's decision is data dependent on whether it will raise rates or not. So if you look at the data, there is nothing in the data telling us that a rate increase will come in 2015 at all. Let's look at the numbers.


Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Runnymede Capital Management, Inc.), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from Runnymede Capital Management, Inc. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. Runnymede Capital Management, Inc. is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of Runnymede Capital Management, Inc.’s current written disclosure statement discussing our advisory services and fees is available for review upon request.