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Steve Cook received his education in investments from Harvard, where he earned an MBA, New York University, where he did post graduate work in economics and financial analysis and the CFA Institute, where he earned the Chartered Financial Analysts designation in 1973. His 46 years of investment... More
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Investing for Survival
  • The Morning Call--A Pause Before The ECB Meeting, The Release Of The Bank Stress Test And The Nonfarm Payrolls Number

    The Market

    Technical

    The indices (DJIA 18096, S&P 2098) underwent more consolidation yesterday but ended within uptrends across all timeframes: short term (16708-19479, 1946-2927), intermediate term (16770-21921, 1765-2479) and long term (5369-18860, 797-???). They both closed above their 50 day moving averages and their mid-December highs. The S&P again finished below the upper boundary of its former long term uptrend (2112), showing just how hard it is to break a long term trend. Meanwhile the Dow remains well below its comparable boundary.

    Volume declined; breadth deteriorated. The VIX rose, closing within its short term trading range and its intermediate term downtrend, below its 50 day moving average and below the upper boundary of a developing very short term downtrend. This indicator is not acting like something negative is coming stocks' way.

    The long Treasury was up, but not enough to recapture the lower boundary of its short term uptrend. Therefore, the short term trend is resetting to a trading range. It remains below its 50 day moving average but within its intermediate and long term uptrends and above its recent low. If TLT trades below that recent low, it will re-set the short term trend to down. That would likely bring additional sales of the long bond position in the ETF Portfolio.

    (click to enlarge)

    GLD was down, ending below the lower boundary of its short term uptrend. If it remains below this support level through the close on Friday, the short term trend will reset to a trading range. It remained within its intermediate term trading range, a very short term downtrend and below its 50 day moving average.

    Bottom line: the indices extended what, at the moment, appears to be a normal consolidation characterized by an absence of buyers---likely a function of a 'wait and see' attitude ahead of today and tomorrow, both of which are expected to be big news event days. I will be watching how investors receive that news for signals on future price direction.

    Bonds reset their short term trend to a trading range and are near resetting once again to down. If that occurs, our ETF Portfolio will likely lighten up this position. GLD remains on the cusp of a breaking support level. A failure to hold will prompt the sales of the remaining shares by our Portfolios.

    Fundamental

    Headlines

    So we finally got a day in which the economic stats were half way decent: weekly mortgage applications were up though the more important purchase applications were down; the ADP private payroll report showed job growth below forecast, but the January number was revised up substantially; both the February Markit services PMI and the ISM nonmanufacturing indices were better than anticipated. Finally, the latest Beige Book report was generally upbeat but sounded way off kilter with the recent dataflow. Nonetheless, let's hope that we see more of this. Unfortunately, a positive data day is now the outlier.

    Overseas, the stats were just the opposite: the Reserve Bank of India dropped interest rates of the second time in two months, fourth quarter Australian GDP was up less than expected, the February EU Markit composite PMI was weaker than its initial reading, the UK services PMI was below estimates, the Japanese services PMI was awful. The one upbeat note was the Chinese services PMI which was slightly better than forecast.

    In summary though, I don't think that a plus day in what may be the sixth week of poor US numbers is nearly as positive as a lousy day in a three week period of mixed reports is negative.

    ***overnight, China lowered its 2015 GDP growth estimate, the ECB left interest rates unchanged, German factory orders were down big and EU retail sales were up less than forecast.

    Bottom line: yesterday was quiet ahead of today's ECB meeting and the results of the US bank stress test and tomorrow's nonfarm payroll number---any of which could impact near term Market direction. Longer term though, stocks are extraordinarily overvalued in the face of poor US economic data, flattish (at best) global economic activity and a spike in interest rates that threatens to go even higher---none of which historically have been great for corporate profits or P/E's.

    I can't emphasize strongly enough that I believe that the key investment strategy today is to take advantage of the current high prices to sell any stock that has been a disappointment or no longer fits your investment criteria and to trim the holding of any stock that has doubled or more in price.

    Bear in mind, this is not a recommendation to run for the hills. Our Portfolios are still 55-60% invested and their cash position is a function of individual stocks either hitting their Sell Half Prices or their underlying company failing to meet the requisite minimum financial criteria needed for inclusion in our Universe.

    More on valuation (short):

    http://www.zerohedge.com/news/2015-03-04/nfib-chief-economist-warns-bubble-us-net-worth-has-reached-unsustainable-heights

    Mark Cuban on the Market (medium):

    http://www.zerohedge.com/news/2015-03-04/mark-cuban-warns-bubble-far-worse-tech-bubble-2000

    Company Highlights

    Chevron is the world's fourth largest oil company based on proven reserves. The company has grown its profits at a 20%+ annual rate over the last 10 years while earning an 11-20% return on equity. The dividend growth rate has not kept pace with profits; but the gap in the rate of increase has been closing. CVX prospects are bright based on:

    (1) one of the most promising development project pipeline in the industry has a number of very promising exploration projects that will grow its reserves. They include deep water production in the Gulf of Mexico as well as fields in western Australia, Angola, Nigeria and the Gulf of Thailand.

    (2) increasing focus on alternative energy sources.

    Negatives:

    (1) exposure to fluctuating oil and gas prices,

    (2) its extensive international operations subjects it to currency fluctuations and political risk,

    (3) its large capital expenditure budget will increase its balance sheet leverage,

    (4) excess capacity is putting pressure on refining margins.

    Chevron is rated A++ by Value Line, has a low 13% debt to equity ratio and its stock yields approximately 3.6%.

    Statistical Summary

    Stock Dividend Payout # Increases

    Yield Growth Rate Ratio Since 2005

    CVX 3.6% 7% 40% 10

    Ind Ave 3.0 10 35 NA

    Debt/ EPS Down Net Value Line

    Equity ROE Since 2005 Margin Rating

    CVX 13% 13% 3 10% A++

    Ind Ave 23 12 NA 6 NA

    Chart

    Note: CVX stock made great progress off its October 2008 low, quickly surpassing the downtrend off its May 2008 high (straight red line) and the November 2008 trading high (green line). However, it has stumbled of late due to lower oil prices. Long term, the stock is in a trading range (blue lines). Intermediate term, it is in a trading range (purple lines). Short term, it is in a downtrend (brown line). The wiggly red line is the 50 day moving average. The Dividend Growth Portfolio owns a 90% position in CVX and the stock is on the Dividend Growth Buy List. However, if intermediate term trend resets from a trading range to a downtrend (which is close), the stock will be Removed from the Buy List; but the holding will be retained. The upper boundary of its Buy Value Range is $111; the lower boundary of its Sell Half Range is $180.

    (click to enlarge)

    http://finance.yahoo.com/q?s=CVX

    3/15

    Investing for Survival

    Ten steps to financial independence (medium):

    http://www.pragcap.com/the-only-basic-financial-advice-youll-ever-need

    News on Stocks in Our Portfolios

    Economics

    This Week's Data

    The February Markit services PMI came in at 57.1 versus expectations of 56.8.

    The ISM nonmanufacturing index was reported at 56.9 versus estimates of 56.5.

    http://www.advisorperspectives.com/dshort/updates/ISM-Non-Manufacturing.php

    The Fed issued its latest Beige Book Report which remained upbeat in tone. Key observations: economic activity up in all regions, job gains in a broad range of sectors, construction spending up.

    http://www.calculatedriskblog.com/2015/03/feds-beige-book-economic-activity.html

    Weekly jobless claims rose 7,000 versus forecasts of a 13,000 decline.

    Fourth quarter nonfarm productivity dropped 2.3% in line; however, the third quarter reading was revised from -1.8% to +3.3%. Unit labor costs were up 4.0% versus consensus of +3.3%.

    Other

    How to end the world's addiction to debt (medium):

    http://www.telegraph.co.uk/finance/comment/jeremy-warner/11448051/Only-mass-default-will-end-the-worlds-addiction-to-debt.html

    The dollar as an indicator of global economic activity (medium):

    http://www.alhambrapartners.com/2015/03/03/swirling-dollars/

    More on dynamic scoring (short):

    http://gregmankiw.blogspot.com/2015/03/no-way-to-avoid-it.html

    For all those 'lower oil prices are an unmitigated positive' adherents (medium):

    http://www.zerohedge.com/news/2015-03-04/scariest-spreadheet-fed-possession-revealed

    Politics

    Domestic

    On the funding of the Department of Homeland Security (medium):

    http://www.powerlineblog.com/archives/2015/03/dem-filibuster-succeeds-house-gives-up-on-defunding-executive-amnesty.php

    International

    NATO sanctions against Russia not having desired effect (medium):

    http://www.nakedcapitalism.com/2015/03/impotent-western-sanctions-fail-disrupt-russian-energy-exports.html

    Mar 05 8:58 AM | Link | Comment!
  • The Morning Call---Atlanta Fed Lowers First Quarter GDP Estimate

    3/4/15

    The Market

    Technical

    The indices (DJIA 18203, S&P 2107) underwent some consolidation yesterday but ended within uptrends across all timeframes: short term (16683-19454, 1943-2924), intermediate term (16752-21903, 1764-2478) and long term (5369-18860, 797-???). They both closed above their 50 day moving averages and their mid-December highs. The S&P again finished back below the upper boundary of its former long term uptrend (2112), sustaining that boundary's magnetic pull on the S&P. Meanwhile the Dow remains well below its comparable boundary.

    Volume declined; breadth deteriorated. The VIX rose 6%, closing within its short term trading range and its intermediate term downtrend, below its 50 day moving average and above the upper boundary of a developing very short term downtrend.

    The long Treasury was down again, leaving it below its 50 day moving average and the lower boundary of its short term uptrend for a second day. A close below that boundary today will confirm that break and re-set the short term trend to a trading range. However, it is still above its recent low. If it trades below that support level (1) then the notion that TLT has stabilized following its early February sell off is called into question and (2) having already made a lower high, it will then have made a lower low and that sets up the potential for another change in the short term trend from a trading range to a downtrend. The good news is that TLT finished within its intermediate and long term uptrends.

    GLD was also down again, ending right on the lower boundary of its short term uptrend, within its intermediate term trading range, a very short term downtrend and below its 50 day moving average.

    Bottom line: after a strong up move in February, some consolidation in the Averages is not unexpected. Plus the inability of the S&P to break the gravitational pull of the upper boundary of its long term uptrend is also not surprising. I noted before that if the S&P ever challenged this boundary that it would likely be difficult to break through in a meaningful way. Hence, there is little reason to question the upward momentum in the Market, save for its lousy internals---but they have been lousy for months now and the indices continue to advance.

    Both bonds and gold are again on the cusp of breaking support levels. A failure by either will likely prompt action by our Portfolios.

    Bull market turns six next week (short):

    http://jeffhirsch.tumblr.com/post/112639620653/fourth-longest-bull-market-in-history-turns-6-next

    A history of the recovery from of the worse bear markets. Notice the similarity in timing of the end of three of those recoveries (short):

    http://www.advisorperspectives.com/dshort/updates/Four-Totally-Bad-Bears.php

    Fundamental

    Headlines

    Yesterday was slow in terms of US economic data: month to date retail chain store sales were up but slowed slightly from last week and February light vehicle sales slowed from January's report. Nothing here to break the string of poor stats.

    Stocks rise as consumers pull back (medium):

    http://www.alhambrapartners.com/2015/03/02/optimismpessimism-stocks-at-record-highs-while-savings-rate-jumps/

    Atlanta Fed forecasts first quarter US GDP at 1.2% (short):

    http://www.zerohedge.com/news/2015-03-03/gdp-shocker-atlanta-fed-calculates-q1-growth-only-12

    Overseas, the numbers were again mixed: the Bank of Australia declined to raise interest rates and Germany reported much stronger than expected monthly retail sales. More evidence that the slide in global economic activity may be coming to an end.

    ***overnight, the Reserve Bank of India lowered rates for the second time in two months; fourth quarter Australian GDP grew less than expected; China's service PMI was slightly ahead of estimates; the EU composite PMI was weaker than the initial reading; UK services PMI was below forecasts; Japan's services PMI was much less than anticipated.

    Greece remains out of the headlines; but that doesn't mean that things are going swimmingly:

    Are Greece and the Troika talking past each other/ (medium)?

    http://www.nakedcapitalism.com/2015/03/greece-troika-eurogroup-actually-deal.html

    Latest developments in Greece (short):

    http://www.zerohedge.com/news/2015-03-03/greek-pensioners-fund-ukraines-government-syriza-will-tap-pension-funds-pay-imf

    Bottom line: the US economic numbers are not improving. Plus yesterday Goldman suggested the economy is in contraction and the Atlanta Fed cuts its first quarter GDP estimate dramatically. If correct, that probably won't be good for earnings forecast. In addition, the bond market has been acting squirrelly. If that continues, it probably won't be good for stock multiples. In short, stocks are considerably overpriced and the major components of prices may soon be facing some stiff headwinds.

    I can't emphasize strongly enough that I believe that the key investment strategy today is to take advantage of the current high prices to sell any stock that has been a disappointment or no longer fits your investment criteria and to trim the holding of any stock that has doubled or more in price.

    Bear in mind, this is not a recommendation to run for the hills. Our Portfolios are still 55-60% invested and their cash position is a function of individual stocks either hitting their Sell Half Prices or their underlying company failing to meet the requisite minimum financial criteria needed for inclusion in our Universe.

    More on valuation (medium):

    http://streettalklive.com/index.php/blog.html?id=2630

    Investing for Survival from Morningstar

    Diversification is often treated as an unalloyed good. It's not. The more I learn, the more I appreciate that Warren Buffett said something as perfect as can be about the subject: "Diversification is protection against ignorance."

    Diversification is a volatility-control strategy that requires little knowledge on your part. As long as 1) two assets aren't perfectly correlated and 2) the expected return on one of the assets isn't too low, it follows as a matter of math that owning a combination of the two can be expected--not guaranteed--to provide a better volatility-adjusted pay-off than owning only one.

    If you know little, diversification is a no-brainer. In fact, you want to diversify as much as possible. Moreover, you want to do it as cheaply as possible, as the benefits of diversification don't require expertise. There is a trade-off. If you know something--say, you can actually identify undervalued stocks--then at some point diversification hurts you by diluting your edge. An extreme example would be someone privy to news that's certain to send a stock's price rocketing. It would be crazy for him not to put a huge chunk of his wealth into the stock (assuming he's not breaking the law). The more you know, the more diversification hurts you.

    Most investors understand that they should diversify a lot. However, some hurt themselves by behaving inconsistently: They diversify a lot while implicitly behaving as if they know a lot. A big subset of this group is investors who own lots of different expensive funds. Owning one expensive fund is a high-confidence bet on the manager. Well-done studies estimate that the percentage of truly skilled mutual fund managers is in the low single digits.

    It would be strange if your process for assessing managers turns up lots and lots of skilled ones, because there aren't many in the first place. (If you see skilled managers everywhere, chances are your process is broken or not discriminating enough.) It would be even stranger if you bet on many of them. Doing so dooms you to getting index-fund-like results while paying hefty fees. It makes little sense to pay 1% or more of assets on an aggregate portfolio with hundreds of positions and market like behavior.

    An exception is if you assemble a portfolio of extremely concentrated fund managers. Owning 10 funds with 10 stocks each put together will look like a moderately concentrated fund manager. This is a model some successful endowments, hedge funds, and mutual funds use.

    Most investors should own diversified, low-cost funds. Those who believe they know something should concentrate to the extent that they're confident in their own abilities. A big danger is that humans are overconfident; many will concentrate when they should be diversified.

    A young investor with lots of room to make mistakes and a passion for investing should consider forming a portfolio of "play money" with a handful of his best ideas. Over time, he can learn whether he knows what he's doing and either size up or down his bets. An advantage of a concentrated "skill" portfolio is it becomes quickly apparent if an investor knows what he's doing. This can prevent a lot of heartache down the road. An older investor near or in retirement just beginning to learn about investing cannot take the risk of self-exploration. He should stick to low-cost, highly diversified funds.

    News on Stocks in Our Portfolios

    Brown-Forman Corporation EPS in-line, misses on revenue

    · Brown-Forman Corporation (NYSE:BF.A) (NYSE:BF.B): FQ3 EPS of $0.87 in-line.

    · Revenue of $1.1B (+1.9% Y/Y) misses by $20M.

    Economics

    This Week's Data

    Redbook Research reported month to date retail chain store sales rose 2.7% year over year versus last week's reading of +2.8%.

    February light vehicle sales declined versus January's report but increased versus February 2014.

    http://www.calculatedriskblog.com/2015/03/us-light-vehicle-sales-decrease-to-162.html

    Weekly mortgage applications rose 0.1% but purchase applications fell 0.2%.

    ADP February private payrolls grew 8,000 less than expected; however, the January reading was revised up by 37,000.

    Other

    Raising interest rates may not be all that bad (medium):

    http://www.pragcap.com/raising-interest-rates-might-not-be-as-crazy-as-some-make-it-seem

    Could oil prices plummet again? (medium):

    http://www.zerohedge.com/news/2015-03-03/could-oil-prices-plummet-second-time

    Is the Bank of Japan losing control? (short):

    http://www.zerohedge.com/news/2015-03-03/boj-losing-control-demand-wanes-jgbs

    Politics

    Domestic

    International War Against Radical Islam

    Netanyahu's message to congress (medium):

    http://www.powerlineblog.com/archives/2015/03/netanyahus-message-to-congress-and-to-the-president.php

    Mar 04 8:58 AM | Link | Comment!
  • The Morning Call & Subscriber Alert--Goldman Declares Economy In Contraction

    The Market

    Technical

    The indices (DJIA 18288, S&P 2117) had a good day, ending within uptrends across all timeframes: short term (16683-19454, 1943-2924), intermediate term (16745-21896, 1764-2478) and long term (5369-18860, 797-???). They both closed above their 50 day moving averages and their mid-December highs. The S&P finished back above the former upper boundary of its long term uptrend (2112); but is still hugging that boundary. Meanwhile the Dow remains well below its comparable boundary.

    http://ciovaccocapital.com/wordpress/index.php/stock-market-us/are-the-bullish-breakouts-holding/

    Volume declined; breadth improved but not as much as the pin action would suggest. The VIX fell, closing within its short term trading range, its intermediate term downtrend and below its 50 day moving average.

    The long Treasury got whacked, driving it back below its 50 day moving average and the lower boundary of its short term uptrend. A close below that boundary on Wednesday will confirm that break. However, it finished within its intermediate and long term uptrends and above its 50 day moving average.

    http://gavekal.blogspot.com/2015/02/on-long-bond-and-why-widow-maker-is.html

    Japan starting to realize the downside to QE (medium):

    http://www.zerohedge.com/news/2015-03-02/japan-approaches-limit-bond-buying-former-boj-official-okina-warns

    GLD was down, ending very close to the lower boundary of its short term uptrend, within its intermediate term trading range, a very short term downtrend and below its 50 day moving average.

    Bottom line: the indices had another good day, though volume fell and breadth wasn't that supportive. Plus the Market internals continue to signal caution. But price is truth and the truth is prices are moving higher.

    http://thefatpitch.tumblr.com/post/112509074117/risk-reward-is-now-skewed-negative-for-us-equities

    Both bonds and gold took it in the snoot and seem likely to test recent lows. A failure by either to hold those support levels will likely prompt action by our Portfolios.

    March performance following a down January/up February combo (short):

    http://jeffhirsch.tumblr.com/post/112548256753/march-performance-following-down-january-up

    Fundamental

    Headlines

    US economic data took up where it left off last week: January personal income and spending were both lower than expectations with spending showing negative growth (for the second month is a row); the February ISM manufacturing index was slightly less than anticipated and January construction spending was well below forecast and like personal spending was negative. There was one positive indicator---the February Markit manufacturing PMI. The personal spending number is particularly disappointing; the economy will have a tough time showing growth when consumers are cutting their spending.

    Goldman affirms that US economy is in contraction (medium and clearly a must read):

    http://www.zerohedge.com/news/2015-03-02/us-macro-weakest-july-2011-goldman-affirms-global-economy-contraction

    Overseas, the news was more mixed: EU consumer prices fell 0.3%; unemployment was lower but so was the PMI manufacturing index. On the other hand, the UK PMI manufacturing index improved. As I have been noting, mixed international data is a positive in that the biggest risk to our outlook is a slowing global economy. While 'mixed' doesn't necessarily mean that a slide to recession has been halted, it clearly raises the question. And at this point, I will count that as a plus.

    ***overnight, the Bank of Australia held interest rates at current levels; German retail sales were much stronger than expected.

    The Greek/EU financial spat continued to fade from the headlines; though there remains a negative undercurrent that could push the potential of a Greek default back to center stage.

    The risk of the Greeks overplaying their hand (medium):

    http://www.nakedcapitalism.com/2015/03/greece-kolotumbas-increasing-at-disconcerting-rate.html

    Fears of a Greek default are rising again (medium):

    http://www.zerohedge.com/news/2015-03-02/greek-default-fears-return-government-considers-borrowing-pensions-repay-imf

    Goldman on why Greece can't go back to the drachma (medium):

    http://www.zerohedge.com/news/2015-03-02/can-greece-just-print-drachmas-goldman-answers

    Is Portugal any better off than Greece? (medium):

    http://www.zerohedge.com/news/2015-03-02/fairy-tale-portugals-successful-turnaround

    Bottom line: the US economic numbers are not improving and no one seems to give a damn. Either that or everyone is assuming that as long as the numbers are poor, the Fed will never raise interest rates. Whatever the reason, stocks are getting ever more over valued while the prospects for one key component of that valuation (corporate earnings) are getting worse and the other (P/E) is near an historic high. That doesn't mean that prices can't go higher; but it does mean that the risk of mean reversion will advance with them.

    I can't emphasize strongly enough that I believe that the key investment strategy today is to take advantage of the current high prices to sell any stock that has been a disappointment or no longer fits your investment criteria and to trim the holding of any stock that has doubled or more in price.

    Bear in mind, this is not a recommendation to run for the hills. Our Portfolios are still 55-60% invested and their cash position is a function of individual stocks either hitting their Sell Half Prices or their underlying company failing to meet the requisite minimum financial criteria needed for inclusion in our Universe.

    The latest from Bill Gross (medium):

    http://www.advisorperspectives.com/commentaries/20150302-janus-capital-group-going-to-the-dogs

    More on valuation (medium):

    http://www.advisorperspectives.com/dshort/updates/Q-Ratio-and-Market-Valuation.php

    http://www.advisorperspectives.com/dshort/updates/PE-Ratios-and-Market-Valuation.php

    Subscriber Alert

    The stock price of Medtronic (NYSE:MDT) has traded into its Sell Half Range. Accordingly, one half of its positions in the Dividend Growth and Aggressive Growth Portfolios will be Sold at the Market open this morning.

    Company Highlights

    General Dynamics is a leading defense contractor supplying products and technology to marine systems, combat systems, information systems and aerospace (basically submarines, tanks, aircraft and command and control systems). The company has grown earnings and dividends 11% and 13% respectively over the last 10 years and has earned a consistently high 17-18% return on equity. GD should be able to continue to match that record because of:

    (1) its broad diversified portfolio of products and service,

    (2) growing backlog of orders,

    (3) improving sales at Gulfstream,

    (4) an aggressive cost reduction program,

    (5) share repurchases.

    Negatives:

    (1) a large percentage of its sales are dependent on government spending both in the US and Europe,

    (2) emergence of China as a premier defense contractor.

    GD has a debt to equity ratio of approximately 21%, is rated A++ by Value Line and its stock provides a yield of 1.7%.

    Statistical Summary

    Stock Dividend Payout # Increases

    Yield Growth Rate Ratio Since 2005

    GD 1.7% 4% 30% 10

    Ind Ave 1.6 10* 25 NA

    Debt/ EPS Down Net Value Line

    Equity ROE Since 2005 Margin Rating

    GD 21% 21% 1 9% A++

    Ind Ave 38 17 NA 9 NA

    *many companies in GD's industry don't pay a dividend

    Chart

    Note: GD stock made great progress off its March 2009 low, quickly surpassing the downtrend off its September 2008 high (straight red line) and the November 2008 trading high (green line). It is in uptrends across all timeframes: long term (blue lines), intermediate term (purple lines) and short term (brown line). The wiggly red line is the 50 day moving average. The Dividend Growth and Aggressive Growth Portfolios own full positions in GD. The upper boundary of its Buy Value Range is $64; the lower boundary of its Sell Half Range is $152.

    (click to enlarge)

    http://finance.yahoo.com/q?s=GD

    3/15

    Investing for Survival

    Asset allocation intangibles (medium):

    http://awealthofcommonsense.com/asset-allocation-intangibles/

    News on Stocks in Our Portfolios

    Bank of Nova Scotia misses by C$0.04, misses on revenue

    o Bank of Nova Scotia (NYSE:BNS): FQ1 EPS of C$1.36 misses by C$0.04.

    o Revenue of C$5.86B (+3.9% Y/Y) misses by C$150M.

    Economics

    This Week's Data

    The February PMI manufacturing index was reported at 55.1 versus expectations of 54.0.

    The February ISM manufacturing index came in at 52.9 versus estimates of 53.0.

    http://www.crossingwallstreet.com/archives/2015/03/february-ism-52-9.html

    January construction spending declined 1.1% versus forecasts of +0.3%.

    http://www.calculatedriskblog.com/2015/03/construction-spending-decreased-11-in.html

    Other

    The next subprime lending crisis (medium):

    http://www.newrepublic.com/article/121152/subprime-auto-lending-how-govt-can-stop-new-financial-crisis

    The problems with 'dynamic scoring' (medium):

    http://www.nytimes.com/2015/03/01/upshot/a-slippery-new-rule-for-gauging-fiscal-policy.html?smid=pl-share&_r=0&abt=0002&abg=0

    The world in front running the ECB QE (short):

    http://www.zerohedge.com/news/2015-03-02/what-entire-world-frontrunning-ecb-looks

    Politics

    Domestic

    International

    More saber rattling in Ukraine (medium):

    http://www.zerohedge.com/news/2015-03-02/russia-warns-nato-any-threat-ukraine-will-see-military-response

    US counters with 'boots on the ground' (medium):

    http://www.zerohedge.com/news/2015-03-02/despite-russian-warnings-us-will-deploy-battalion-ukraine-end-week

    Mar 03 9:05 AM | Link | Comment!
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