Nathan Kowalski is the chief financial officer of Bermuda-based investment firm Anchor Investment Management Ltd. He holds Chartered Accountant, Chartered Financial Analyst and Chartered Investment Manager designations. He is currently the president of the Chartered Financial Analyst Society of Bermuda board. Mr Kowalski started his career with KPMG, where he provided assurance, tax and financial advisory services for some of the largest corporations in Canada. He then worked for Deloitte & Touche Corporate Finance Inc, where he specialised in providing advice on mergers and acquisitions, valuations for corporate clients and private-equity firms, entrepreneurs and governments.
Nov 25, 2013 8:00 am
The S&P 500 is having its best year since 2003 with gains of over 26 percent year to date. Small cap stocks are soaring even further — up some 30 percent and the Dow Jones Industrial Average has been hitting record highs — up over 20 percent as well. All these widespread gains have sparked a raft of bubble talk and scepticism. Barron’s even had a picture of a bubble on its front cover last weekend. Ironically this is nothing new, some of...
Nov 19, 2013 8:00 am
Bermuda’s national health care issues are indeed numerous (eg, access, pricing, coverage, funding etc) and one of the Island’s biggest fiscal drains. Rapidly rising healthcare costs undermine the all-important confidence of small and medium-sized businesses, costing jobs and ultimately economic growth. The debate has recently focused on “who is without” and “who pays for what”, and not the more important aspect of actually lowering overall...
Nov 4, 2013 8:00 am
Recently Bermuda’s Department of Statistics (DoS) released its fourth annual Environmental Statistics Compendium which claims Bermuda’s population has increased over the past two years.
In our latest quarterly economic update Anchor Investment Management did some work on this issue and we estimate that Bermuda’s population declined by 4.2% since the last census in...
Oct 16, 2013 8:00 am
The Chartered Financial Analyst Society of Bermuda recently hosted the Global Interdependence Conference in Bermuda on October 10 and 11. It was a fantastic forum with some world-class speakers. What follows are a few key takeaways.
1) Sometimes we don’t know
Sep 30, 2013 8:00 am
“The one thing I will tell you is the worst investment you can have is cash. Everybody is talking about cash being king and all that sort of thing. Cash is going to become worth less over time. But good businesses are going to become worth more over time. And you don’t want to pay too much for them so you have to have some discipline about what you pay. But the thing to do is find a good business and stick with it. We always keep enough cash...
Sep 16, 2013 8:00 am
“A democracy cannot exist as a permanent form of government. It can only exist until the people discover they can vote themselves largesse out of the public treasury. From that moment on, the majority always votes for the candidate promising the most benefits from the public treasury, with the result that democracy always collapses over a loose fiscal policy — to be followed by a dictatorship.” — Alexander Fraser Tytler
Sep 9, 2013 8:00 am
How high will bond yields rise and where does the rout in US Treasury securities cease in the short term?
This question has been on bond investors’ minds for some time now.
Much of the recent rise in yields is likely related to investor concerns over the Fed’s intentions to taper its purchases of government bonds as soon as this month and potentially end its purchases completely by sometime next spring.
Sep 3, 2013 8:00 am
There is a branch of economics that deals with the operations of the political process called public choice theory.
Often credited to the economist James Buchman who won a Nobel Prize in economics, it deals with a theory linking individual behaviour to ultimate political action.
In general, the political process works very well when there is a close and transparent relationship between the receipts of benefits and payment of costs.
Aug 19, 2013 8:00 am
I recently watched an online video commentary by Brian Wesbury at First Trust on basic economics (links to the videos below). What struck me about these pieces was their elegant simplicity in summarising what many would consider complex economic aspects. At the end of the day there are two basic economic trains of thought: demand side economics and supply side economics. I’ll summarise each briefly and then end with a great story to narrate my...
Aug 5, 2013 8:00 am
(Second of two parts)
Unit labour cost (“ULCs”) is a well-known measure of international competitiveness which combines labour cost and productivity into a single measure. In general, unit labour costs show how much output the economy receives relative to wages, or labour cost per unit of output.
Jul 29, 2013 8:00 am
The world is increasingly becoming a more open economic forum. As a result the inexorable march in global competition continues every year. (This is Part 1 of 2)
Nations are at war for jobs, economic growth and distinct, sustainable competitive advantages.
As we have written before in Bermudas New Normal, one aspect in determining a nations base growth rate is how productive it is.
Jul 15, 2013 8:00 am
Inertia is one of the fundamental principles of classical physics. It is often referred to as the tendency of an object to resist changes to its state rest or motion. Newton suggested that an object will continue moving in its current velocity until some force causes its speed or direction to change.
Jul 8, 2013 8:00 am
Investors are scrambling and yanking billions from US bond funds since the Federal Reserve rattled markets with its plan to end the central banks unprecedented asset purchase programme. According to research firm TrimTabs Research, mutual funds and bond exchange-traded funds saw a combined $47.2 billion in fund outflows during June. This was biggest monthly outflow on record, even exceeding October 2008. Retail investors who have put...
Jul 1, 2013 8:00 am
The Industrial Revolution marked a major transformation in the way the world manufactured and produced goods. Humans largely went from hand-producing individual items to a new manufacturing paradigm involving the use of new tools and machines, harnessing the power of water and steam, and employing new iron and chemical manufacturing processes.
Jun 24, 2013 8:00 am
On Wednesday the US Federal Reserve (the Fed) indicated that their Quantitative Easing Programme (QE) (a programme where they buy Treasuries and mortgage backed securities) will be more conditional on economic circumstances in the US and is likely to be curtailed or tapered if conditions continue to improve. Specifically, QE will continue until the labour market has improved substantially or the unemployment...
Jun 10, 2013 8:00 am
By Nathan Kowalski
Wow that cost over $20 a drink? said a girl sitting at the table with our group.
Thats crazy, said another guy, peanut shells on the floor crunching beneath his feet.
You all obviously havent had cocktails in Bermuda for Happy Hour, I stated with a grin.
May 13, 2013 8:00 am
The Value Investing Congress just concluded in Las Vegas where approximately 20 speakers gave their pitches for their favourite stocks. I always find this conference a useful source of ideas to take a further look at. Some of the speakers have incredible track records and their analysis is very robust. The one aspect, however, that really caught my eye was not a stock pick. It was on the very first slide of Whitney Tilsons slide deck.
Apr 30, 2013 8:36 am
The SAGE Commission in Bermuda has been formed to identify activities that are central to the core mission of Government; to evaluate and analyse the operations of Government and its corporate bodies and agencies in line with international best practice; and to make recommendations regarding the streamlining of such processes to improve service delivery (effectiveness), cost savings (efficiency), greater transparency and...
Apr 15, 2013 8:00 am
The world continues to be flooded with cheap money as central banks engage in monetary easing. This grand financial experiment is likely leading to some aberrations and distortions in fiat currencies, precious metals and some unique alternatives. This is presenting investors with unique risks and opportunities.
Apr 8, 2013 8:00 am
Regular readers of this column know that I am a big fan of Warren Buffett. As a shareholder of Berkshire Hathaway, I am always pleased to get my copy of the annual report. Inside I know Ill find Buffetts letter to the shareholders which always contains gems of advice. This year didnt disappoint.
The following are some of his selected quotes with my comments:
Mar 25, 2013 8:00 am
Although equity markets are soaring near all-time highs, public trust in the finance profession has moved in the other direction.
Even though the financial service industry does provide a necessary and beneficial services to society such as lending, preparing for retirement or directing investment capital to fund growth, many public opinion polls offer a dim view on the industry.
Mar 19, 2013 10:31 am
Modern portfolio theory espouses the benefits of diversification. Essentially holding a basket of securities with varying correlations should help lower volatility and enhance risk adjusted returns. Its important to note, however, that all periods are different and diversification has helped to varying degrees over time.
See Table #1 which outlines various returns on different allocations.
Mar 11, 2013 8:00 am
A few random comments on the markets and finance:
Yes thats right. We seem to be in a bull market. The S&P 500 has produced a total return of about 150 percent since the bottom in March of 2009.
Dont tell anyone though because most people dont realise it yet. Most Main Street folks are still smarting from the 2008-09 collapse.
Feb 27, 2013 8:00 am
After reading through the Budget release and attending the Bermuda Chamber of Commerces Budget Breakfast it is my opinion that Bermudas economic challenges are both enormous and wide ranging. In which case balancing the Budget will be a significant and difficult task requiring patience and time. What follows are a few negative and positive takeaways from the current situation:
Feb 11, 2013 8:00 am
The investment industrys obsession with measurement, performance and comparisons has always struck me as odd.
The fact that investment professionals expend so much time and energy devising various measures and comparative statistics seems at odds with what they should be focused on, which, of course, should be generating absolute returns that correspond with their clients needs and constraints.
Feb 4, 2013 8:00 am
Many countries are currently focused on amending and considering immigration changes because they realise that immigration reform can be a powerful toll to enhance the economic prospects for their country. In Bermuda the government has ended term limits in an effort to boost the economy. The United States is also currently considering major immigration reform that has the potential to assist boosting their middling economy as well. Can...
Jan 29, 2013 8:00 am
Apple was taken to the cleaners on Thursday after it reported financial results on Wednesday night. One of the worlds most discussed stocks and a perennial Wall Street darling lost about $63.70 or almost $60 billion in market capitalisation. So what gives? Is Apple in trouble or going out of business? Im not making a buy or sell recommendation, only giving some food for thought on the worlds second largest company.
Jan 14, 2013 8:00 am
This is the season of the year when a host of high-priced economists unlimber their high-speed computers and uncork their precise predictions for the economy for the year ahead: the exact level of GNP [now GDP], the inflation rate, unemployment and so on. In this lucrative forecasting business, all the forecasts are more or less the same, and they will be usually proven way off the mark.
Jan 7, 2013 8:00 am
In January of last year I laid out 12 unexpected events that were currently outside of the conventional consensus opinion that I felt had a reasonable chance of occurring (http://www.royalgazette.com/article/20120109/COLUMN05/701099993). Lets go back and take a look at how these surprises panned out.
Dec 12, 2012 8:00 am
One common concern among investors is the lack of income opportunities in the market. Bond yields have collapsed to record lows and offer very little absolute income. In fact most of the treasury curve actually offers negative real returns after accounting for inflation.
Greens donate $150,000 for new hospital wing
Senators speak out over newspaper cartoon
Family’s pet puppy ordered to be put down
‘I was expecting to blow up at any moment’
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