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Marcelo Perez

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Articles by Marcelo Perez

SPECIAL REPORT: It Was The Eurodollars All Along

26 days ago

The Global Financial Crisis of 2008 was felt far and wide, in places with no connection at all to the US mortgage market. That is, or should be, a clue that the crisis wasn’t really about sub-prime mortgages at all. There were places, though, that avoided much of the turmoil. One of the oddest and unexpected might be Argentina, a country that needs no outside help whatsoever to create a financial crisis. Indeed, the country, once one of the richest in the world, has spent a good portion of the last 70 years lurching from crisis to crisis, all of their own making.
Our Special Report on Eurodollars , the 2nd edition in Jeff Snider’s “Follow The Money” series, will help you make sense of what really happened, and will counsel you on how to navigate your portfolio through turbulent times.

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Monthly Macro Monitor: Doom & Gloom, Good Grief

October 10, 2019

When I first got in this business oh-so-many years ago, my mentor told me that I shouldn’t waste my time worrying about the things everyone else was worrying about. As I’ve related in these missives before, he called those things “well-worried”. His point was that once everyone was aware of something it was priced into the market and not worth your time. That has proven to be valuable advice over the years and I think still relevant today.
We continue to hear, on an almost daily basis, about all the bad things going on in the world. Trade wars, real wars, Ukraine, impeachment, blacklisted Chinese companies, retaliation for blacklisting Chinese companies, tariffs on European goods (scotch??#$%^&!), climate scolding by woke teens, manufacturing recession, pension crisis, rising government

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SPECIAL REPORT: Money Market Turmoil

October 8, 2019

Jeffrey Snider’s Follow The Money Series: Money Market Turmoil
On Monday, September 16, funding markets came under significant pressure. In repo, the GC rate (UST) jumped to 2.876% from 2.288% the Friday before. Repo rates and other money rates like federal funds had been elevated already but this 60-basis point move was highly unusual.
Our Special Report on the Money Market Turmoil will help you make sense of this short-term funding phenomenon and all its implications, and will counsel you on how to navigate your portfolio through these turbulent times.

Click here to download “Follow The Money: Money Market Turmoil” (Sign-Up Required).

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SPECIAL REPORT: The Yield Curve And What It Means

September 13, 2019

The Yield Curve Inverted! Recession is Coming!
Do you need to worry about the yield curve inversion? Not if you have a strategy appropriate to your circumstances. Not if you know what tactics you will employ when recession is imminent. And most importantly, not if you know what the yield curve and other indicators are really saying about the current economy.
Our Special Report on the Yield Curve will help you make sense of this yield curve phenomenon and all its implications, and will counsel you on how to navigate your portfolio through these turbulent times.

Click here to download “The Yield Curve And What It Means”.

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Retirees Lose $3.4 Trillion By Claiming Social Security Too Early

September 4, 2019

For years now, there’s been lots of talk about what happens if you claim Social Security benefits before full retirement age (FRA) or even waiting until the maximum age of 70. Claiming early means you’ll receive less money, permanently, than if you waited. In spite of the warnings, only 4% of retirees wait until 70 to claim benefits and that costs trillions of dollars of potential retirement income.
Every year, the Social Security Administration pays more than $1 trillion to more than 65 million people, which accounts for about one-third of all retirement income. Approximately half of retirees say that more than 50% of their income comes from Social Security, and a third say it’s more than 90%.
A study conducted by United Income, The Retirement Solution Hiding in Plain Sight:  How Much

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Hedgeye Podcast: One-On-One With Joe Calhoun

August 27, 2019

Our very own Joe Calhoun, founder and CEO of Alhambra Investments, was invited to feature on Hedgeye’s 20th episode of In the Arena. He joins Hedgeye’s Daryl Jones in a lively discussion on the current investing landscape and hurdles facing the U.S. economy:

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The Benefit of Working With a Fiduciary Adviser

August 16, 2019

What is a Fiduciary?
You may have heard the term in recent times due to the ongoing debate about whether stockbrokers should be held to such a standard. Since doing so would make it harder for them to sell you things that pay them high commissions, peddlers of Wall Street’s wares are, as one might expect, opposed to this imposition. And so far, they’ve been successful in heading off any change to the current system that allows them to follow the self-imposed constraint of selling you only things that are “suitable”, a term of considerable flexibility.
So, what does it mean to be a fiduciary and why does it matter to you? Quite simply, a fiduciary is someone who acts in your stead, solely in your interest and adheres to the Prudent Man Rule or, to update the appellation for modern times,

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How Can We Help?

April 17, 2019

We sincerely hope you’re enjoying Alhambra Investment’s research and analysis. As a gentle reminder, we go well beyond just offering market and economic insights.
Alhambra also manages both Strategic (Passive) and Tactical (Active) portfolios with a talented team of seasoned professionals. As Registered Investment Ad­visers, we have a fiduciary responsibility to our clients and we’d welcome the opportunity to help you achieve your financial and investment goals.
If you are uncertain about your current advisory relationship, or just want a second opinion, we offer a free, no-obligation assessment. We’ll review your asset allocation as well as the costs of your current investment program. Most of the portfolios we review are more complex and costlier than necessary. We can show you how to

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Bloomberg Interview with Jeffrey Snider

October 30, 2018

Why Eurodollars Might Be Key to the Market Sell-Off (Podcast)
There’s a huge market out there that doesn’t get much attention: Eurodollars. These have nothing to do with the euro-dollar exchange rate. Instead, eurodollars are U.S. dollar-denominated deposits at foreign banks and overseas branches of American banks. They’re effectively a source of dollars that operates outside the control of the U.S., and have at various times been blamed for exacerbating interbank lending crunches. Jeff Snider, Head of Global Research at Alhambra, has a theory that recent market volatility might have its roots in some eurodollar drama. He speaks with Odd Lots about how this market grew in tandem with globalization, and how we should be thinking about it now.

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Bi-Weekly Economic Review: Welcome To The Slowdown

July 6, 2018

Welcome to the slowdown. It isn’t much – yet – and it may just be a passing phase, but there is little doubt that the US economy has slowed somewhat. The rise in short term interest rates has stalled and the long end of the curve has rallied. The result is a flatter yield curve but it isn’t the flatness that provides us with information so much as how it got there. The stall in short term rates tells us the market is getting skeptical about the Fed’s rate hiking path. The Fed may think it is going to hike twice more this year but the market has serious doubts.
In the last report I highlighted the change in the futures market positioning for the 2 year note. The short position had been covered and speculators were actually long the 2 year. And that is still the case and as expected. Futures

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Bi-Weekly Economic Review: Growth Expectations Break Out?

May 22, 2018

There are a lot of reasons why interest rates may have risen recently. The federal government is expected to post a larger deficit this year – and in future years – due to the tax cuts. Further exacerbating those concerns is the ongoing shrinkage of the Fed’s balance sheet. Increased supply and potentially decreased demand is not a recipe for higher prices. In addition, there is some fear that the ongoing trade disputes may impact foreign demand for Treasuries. There are also, as our Jeff Snider has reported, some stresses in the Eurodollar market that are impacting Treasuries. 
An unappreciated source of volatility is the mortgage market. Holders of mortgage securities, such as mortgage REITs, hedge with Treasuries to maintain their desired duration (or interest rate swaps but the result

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Forget It, China’s Not Booming

January 25, 2018

Jeffrey Snider, head of global investment research at Alhambra Investments, says China is in fact not growing rapidly, which sounds disheartening for commodity investors. He reckons a crucial investment metric has weakened, pointing to slower economic expansion:

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2018 Social Security and Medicare Changes

January 18, 2018

Every new year brings changes and for 2018 the Federal Government has made changes to Social Security and Medicare. Surprise, surprise! Some retirees get a raise. Some workers will see more come out of their checks for future benefits. And most Medicare recipients will pay more for health care.
First, the good news. For the first time in almost three years, retirees get a raise from Social Security. The cost-of-living increase is 2%. The average increase for a single person is $27/month and a couple will see an extra $46/month.
But before you get too excited thinking about where to spend all that extra money, the Government has made the decision for you. Most of the COLA increase disappears before you see it because Medicare Part B premiums are going up. In 2018 the premium increases to

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The Healthcare Vampire

September 18, 2017

Oh, for the old days when planning for retirement was simple and you knew what to expect, especially when it came to healthcare. There was Medicare. Add a good Medicare supplement to cover other costs and you were good to go. Those days are gone! For many retirees, healthcare has become Dracula and it’s sucking the blood out of their retirement savings.
Fidelity Benefits Consulting estimates that a 65-year-old couple retiring in 2017 will spend 275,000 (in today’s dollars) for healthcare. That’s up $15,000 from 2016 and does not include the cost of nursing home care or long-term care expenses.
But wait! At 65 you get Medicare. True. However, you have to pay the monthly premium for Parts B and D. Those two make up 35% of Fidelity’s estimate. The other 65% is made up of cost-sharing,

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IRS Grants Regulatory Estate Tax Relief

August 15, 2017

By Rafael A. Perez, Esq, Chief Compliance Officer

The IRS has provided regulatory relief in the estate tax arena for surviving spouses whose partner died after 2010.  While this relief applies to a very narrow set of persons, if it does apply you may substantially reduce future estate taxes thereby passing on more assets to your heirs.
You should take action if the following conditions apply to you:

Your spouse passed away on or after January 1, 2011;
Your spouse’s estate did not file an estate tax return; and
Your estate can potentially be worth more than $5,500,000 at the time of your death (this figure was set by Congress at $5,000,000 in 2011 and indexed for inflation – it stands at $5,490,000 in

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