Tuesday, Raymond James strategist Jeffrey Saut used a “Chart of the Day” in his Seeking Alpha article–Is This the Beginning of a New Secular Bull Market?–to put historical perspective on the current stock market rally that began in March.

We thought we should list this historical performance in table format in terms of total returns (% Gain), number of days (or rally duration) and annualized returns (% GPA). The tables are listed below.

Share prices of most companies in the semiconductor industry have seen significant gains since the March lows, with some shares climbing 100, 200, and even 300 percent. Many of these companies have also experienced significant revenue growth, primarily driven by increased sales with the easing of the recession. In the absence of any major tech boom, revenue growth will undoubtedly slow and the share prices in the industry will likely falter. However, some semiconductor companies will continue to see increasing revenue flows, especially those with innovative product offerings and those experiencing increasing demand for their products.

In particular we believe that Skyworks Solutions Inc. (SWKS) should benefit from the combination of an innovative product line and demographics that favor increasing demand for their wireless line of products. The company makes integrated circuits and semiconductors that are used in wireless telephone handsets and infrastructure, as well as in numerous other products with wireless functionality. Skyworks, which was formed in 2002 with the merger of Alpha Industries and the wireless communications division of Conexant Systems Inc. (CNXT), built its reputation as a military contractor, and still serves as sole-source provider of radio frequency components for the U.S. military’s Aegis radar system.

Martek Biosciences Corp. (MATK) is a global leader in the production of docosahexaenoic acid from microalgae and arachidonic acid from fungus, and as such stands to benefit from the combined U.S. demographics of an expected uptick in U.S. births, aging baby boomers and an apparently health-conscious Generation Y.

“Wait a minute! Docosahex-what? Arachid-what? Made from microalgae? Fungus? And, what does this have to do with babies, teenagers and the soon-to-be elderly?”

U.S. consumers turned decidedly more pessimistic in October, according to a report released Tuesday, with households increasingly worried about job prospects.

The Conference Board, a private research group, said its monthly Consumer Confidence Index fell to 47.7 this month, from a revised 53.4 in September, which was originally reported as 53.1. The current month's reading was well below economists' projections of 53.2, according to a survey conducted by Dow Jones Newswires.

“Nothing can be said to be certain except death and taxes,” said Benjamin Franklin. And with death being a certainty, one would expect that the business of death should always make money.

Of course, how much money is dependent on numerous factors, among which the most important would be how many people are dying. In short: demographics.

We admit there are many reasons why the U.S. could enter into a "Lost Decade" similar to that experienced by Japan starting in the 1990s. Demographics, however, is not one of them. By studying the generational makeup and growth of the U.S. and Japanese consumer (ages 15 to 70) from 1970 to 2025, one can see it is like comparing apples with mangoes.

In the charts below we have taken a snapshot of consumers (both historical and estimated for future years) aged 15 to 70 every five years between 1970 to 2025 to illustrate the changing demand of the differing generations. For example, in Japan in 1990 (the key 40 year consumer cycle peak) the consumer makeup was:

Nu Skin Enterprises Inc. (NUS) climbed more than 13 percent in early morning trading Tuesday after the company pre-announced quarterly earnings that broke previous records and surpassed analysts expectations, and raised guidance for full year earnings. Nu Skin, one of our favored “aging” demographic plays, has been on a tear for the past month, up about 28 percent since Oct. 1, and up almost 200 percent from its March 9 low of $8.04. In today’s action the stock hit a four-year high of $24.85 before fading to about $23 in mid-day trading.

The company reported that it expects revenues for the third quarter of $334.2 million, 8 percent higher than third quarter 2008, and that it expects earnings per share of between 39 to 40 cents compared to 26 cents in the prior-year quarter. Analysts on average had been expecting the company to earn 34 cents per share on revenues of $315.1 million.

Harley Davidson Inc. (HOG) yesterday reported an 84 percent plunge in third-quarter profits and announced the dissolution of its Buell line of specialty sport motorcycles and the sale of its MV Agusta division in order to focus its resources on its namesake brand. Harley Davidson CEO Keith Wandell said the return from the sale of an MV Agusta or Buell is far less than the return the company gets from a Harley Davidson, and that “we’re going to be able to grow the company more quickly ... by investing in the power of the Harley Davidson brand.” According to the Wall Street Journal, Wandell admitted that both Buell and MV Agusta have a strong following, but that those divisions were “diverting investment dollars away from the Harley brand to support those brands.”

The shares rose almost 5 percent on the news, and were up another 3 percent in this morning’s trading, but we wonder if investors have considered how the company plans to generate these greater returns when the Baby Boomer generation that makes up the vast bulk of its customer base is rapidly aging out of the market, and the generations following do not seem to share the same affinity for the iconic brand.

Ulta Salon, Cosmetics & Fragrance Inc. (ULTA) and Bare Escentuals Inc. (BARE)–which sells a significant percentage of its personal care products through Ulta retail stores–are sitting in a demographic sweet spot of future growth that will be fueled by increasing populations of its core customer base and by the opening of hundreds of new Ulta stores.

The companies’ potential customer base will see increases with female members of the second–and larger–half of Generation X (those born 1975 to 1984) entering the peak spending years for cosmetics, perfume and bath products. This growing customer base should be further enhanced by the increasing population of U.S. Hispanic women, who on average spend 28 percent more on cosmetics, perfume and bath products than other customers. And as the Gen. X females start exiting the peak cosmetic spending years they will be replaced by the even larger cohort from Gen. Y.

U.S. organic food production has more than doubled since the late 1990s; however, the consumer appetite has grown even faster, with organic food sales increasing from $3.6 billion in 1997 to $21.1 billion in 2008, and now accounting for 3 percent of total U.S. food sales. Despite this doubling, organic food production only represents 0.5 percent of all U.S. crop land and pasture, leaving plenty of room for growth in this burgeoning food product niche business. We believe that U.S. organic food sales will surpass $100 million by 2020.

click to enlarge

U.K.consumer confidence surged nine points in September to the highest level since January 2008 and reaffirms the U.K.'s economic recovery.

There have been only five other times that the index has jumped over nine points or more. In each case the market was always higher 12 months later (median return 24.9 percent).

The Wall Street Journal reported Wednesday that "Latvian Currency Rattles Markets." Perhaps a better headline would have been "Latvian Demographics Rattle Bond Auctions."

Latvian births peaked in 1986 at about 41,000, and are projected to fall to 16,000 by 2044. This will result in the population falling from a 1989 peak of 2.7 million to 1.8 million by 2044, a 30 percent decline.

The Pittsburgh Post Gazette this week reported on the latest figures from the National Retail Federation that concluded spending in the months of November and December (excluding cars, gas and restaurants) should hit $437.6 billion. That compares to $441.97 billion in holiday 2008 spending, and $457.75 billion in 2007. If correct, this year will mark the slowest holiday season since 2005, when sales totaled $433.66 billion, and it would be the first consecutive decline in 40 years.

From the Pittsburgh Post Gazette:

Hats off to TechCruch for bringing our attention to the new potential wave of hardware buying and increasing IT spending that should be spurred by the launch of Windows 7.

Although we are believers that in the long term Microsoft (MSFT) has become "Microstuck," we concede that Microsoft has a strong window of opportunity over the next 12 months or so with the launch of Windows 7 and a new IT spending cycle (many companies have not upgraded since 2001).

One of our favorite "demographic" plays (see our September 23rd Seeking Alpha article), Nu Skin Enterprises Inc. (NUS) climbed more than six percent and hit an new three-year high on an earnings upgrade from Stifel Nicolaus.

Stifel's Mark Astrachan said in a note to clients that he met with the direct-seller of personal care product's Chief Financial Officer Ritch Wood, and came away believing the company is at "the beginning of an acceleration in revenue growth due to the pending launch of ageLOC." Astrachan raised his third-quarter and fourth-quarter earnings estimates by two cents each to 35 cents and 31 cents, respectively. He also upped its 2010 earnings-per-share estimates to $1.45 from $1.41. And he raised his price target by $2 to $22.

The levels of insider selling continue to increase, drawing the attention of the busines media and pundits who speculate on whether it heralds the imminent collapse of U.S. equity markets. The Ned Davis Research Aggregate Insider Rating chart below suggests that while levels of insider selling are high, they have not quite yet reached critical levels to support a bearish stance.

Mark Hulbert in his Sept. 22, Market Watch column–Corporate insiders continue to increase the pace of their selling–states:

Today we highlight the demographic landscape of Canada, which looks in better shape demographically than many of its developed economic partners. The country has been battling against the strong headwinds of a downturn in consumer expenditures that started in 1999 (Peak births in 1959 plus 40 years). However, this is set to turn up in 2013 and remain positive until 2031.

For the last ten years the Canadian economy has benefited from, and is expected to continue to benefit from, the global commodity demand in the energy, materials and agriculture sectors. This, combined with a strong banking system, following it's restructuring from its "bust" in the early 1990s, places it in a strong economic position going forward.

Once again the Dollar (UUP)has been under pressure this week, having declined 17.9 percent since the March 9th equity lows versus a positive return for the Euro (FXE) of 16.4 percent, Sterling (FXB) 15.4 percent, and Commodities (DBC) 12.7 percent.

If you believe as we do that sentiment is a powerful tool in the investment arsenal, the Dollar shorts should lookout as the current "Excessive Pessimism Buy" on the Dollar may lead to future losses rather than expected profits. The indicator below has a profitable trade record of 79 percent with an average gain of 7.8 percent per annum.

Sentiment towards equities improved over the last week and has returned to the Extreme Optimism (Bearish) on the Ned Davis Research's Crowd Sentiment Poll.

We have been following two potential scenarios since the beginning of September:

The release of best-selling Da Vinci Code author Dan Brown’s new novel, The Lost Symbol, seemed to herald the emergence of the electronic reading device (e-reader) as the next mass market, must-have gizmo, as the media trumpeted the news that Amazon.com Inc.’s (AMZN) first-day digital sales of the novel outsold paper copies. However, publishing pundits quickly refuted the assertion, calling into question how Amazon was going to account for pre-orders, which had made the hardcover version one of Amazon’s top-selling books for 156 days. While the actual number of e-book sales of The Lost Symbol is still undergoing vigorous debate–the Associated Press reported that it only represents 5 percent of sales–it seems clear that e-readers and e-books are coming into vogue.

With all that said, the question arises as to which company is ultimately going to become the e-reader sales leader? Among those currently in contention are Amazon, with its “Kindle;” Sony (SNE), with at least five versions of its “Reader;” Samsung (SSNLF.PK), with its “Papyrus;” Fujitsu (FJTSY.PK), with its “FLEPia;” Jinke Electronics, with its “HanLin eBook;” Interead, with its “Cool-er;” and IRex Technologies (a spinoff from Royal Philips Electronics (PHG)), with its “Digital Reader 1000” and “iLiad.”