Sitka Pacific Capital Management, LLC

1st Quarter 2025: Navigating a Foggy Cycle with Value https://lnkd.in/gUCSkiyr #assetallocation #stocks #bonds #gold

2025 Q1 Update: 3.47% The Standard 60/40 Portfolio Yield https://lnkd.in/ghrcZuHP

Q4 2024 Letter: The Time Has Finally Come https://lnkd.in/gYtjVvJM

It doesn't have earnings. It doesn't pay interest. So, how do you value it? One way is this: against other forms of money. Gold is first and foremost a monetary asset, and so its value in dollars is partially determined by how many dollars are floating around. Gold's dollar price is hitting a new record high today. However, its value against the U.S. Monetary Base remains near the lows of the past 60 years. In fact, its value remains below the level it was when the last vestiges of the Bretton Woods system began falling apart in 1970. #gold #monetarybase

The chart below shows the S&P 500's cyclically-adjusted P/E ratio, and the real, inflation-adjusted return over the subsequent decade, going back to 1910. Question: what are the odds that a passive investment in this index will have a positive real return over the next decade? If you think the odds are low, it means the view in the rearview mirror is probably not going to be a good guide for what allocations will deliver in the years ahead. It is time to think differently. #inflation #assetallocation

4th Quarter 2024 Update: 3.23% After reaching a record post-civil-war low of 2.14% in 2021, the underlying yield of a standard portfolio has risen to 3.23% at the start of the fourth quarter of 2024. It remains near prior secular lows of the past century. At Sitka Pacific, we keep clients invested in global equity markets which represent a good value and the opportunity for sustainable growth. More information at links below: The Standard 60/40 Portfolio Yield https://lnkd.in/ghrcZuHP Investment Management https://lnkd.in/grVYwMBH

"As Benjamin Graham observed more than a half-century ago, there are two main reasons the equity market tends to become severely overvalued: the market is in the midst of a mania, or there is a lot of inflation on the way. During the early 1970s?Nifty Fifty?mania, it was a combination of both." In Lieu of the Bountiful Triple Dip https://lnkd.in/enzs-kvd

3rd Quarter 2024 Update: 3.47% After reaching a record post-civil-war low of 2.14% in 2021, the underlying yield of a standard portfolio has risen to 3.47% at the start of the third quarter 2024. It remains near prior secular lows of the past century, which marked the beginning of extended periods of low returns. At Sitka Pacific, we keep clients invested in global equity markets which represent a good value and the opportunity for sustainable growth. Recent valuations of equity markets around the world are highlighted in the link below: The Standard 60/40 Portfolio Yield https://lnkd.in/ghrcZuHP

The last time the price-to-book ratio of the S&P 500 rose above 5, a passive investment in the S&P 500: - fell 49% over the following three years - lost 1/3 of its real, inflation-adjusted value over the following decade - took 16 years to break even Caveat emptor. Memos, Articles, & Letters https://lnkd.in/gYHYXp99

If you would like to learn more about another period when: 1. Inflation rates began to move higher 2. Federal deficits kept expanding uncontrollably 3. Foreign central banks began holding more gold 4. The Federal Reserve found it difficult to raise interest rates 5. Stocks and bonds began to struggle, simultaneously ...click on the link below. Many of the issues we face today have been reckoned with before, and the minutes of the last Federal Open Market Committee meeting, released yesterday, were full of ghosts from this earlier period. The more informed we are, the better advice we will give. The 1965 Pivot and a Rhyme of History https://lnkd.in/gHU3g2Ah #monetarypolicy #federalreserve #inflation