Seeking Alpha

Christopher Mahoney

 
View as an RSS Feed
View Christopher Mahoney's Comments BY TICKER:
Latest  |  Highest rated
  • What Was The Federal Reserve Thinking In Summer 2008? [View article]
    Excellent article. I think the real problem is the financial market ignorance of most academic economists. The profession today is overly mathematical and inadequately real-world. When RMBS and CDOs became unpriceable in 2007, it did not register on the Fed's dashboard. The Fed has ignored financial markets at its peril. Every member of the FOMC should be required to read Hyman Minsky. He elucidated the linkages between finance and macroeconomics. He still gets no respect in the profession, even after having been proven 100% correct. Economists see finance as noise.
    Sep 13 11:33 PM | 1 Like Like |Link to Comment
  • How To Use Money Supply Statistics For Market Predictions [View article]
    The Fed doesn't print money. It buys bonds and creates excess reserves which are not a component of M2. M2 is currency, deposits and near-money. M2 growth is an independent variable over which the Fed has had very little influence. M2 has been growing at 6-7% for the past two years. Minor fluctuations have no information content for equity markets. What impacts equity markets are bond yields.
    http://bit.ly/1m2XgQL;category_id=
    Sep 13 11:23 PM | 4 Likes Like |Link to Comment
  • Why U.S. Equities Are Hitting All-Time Highs [View article]
    The recovery is weak. If in fact it is strong, bond yields will rise and the bull market will go into reverse. If you think that all is well, sell stocks. As for me, I like stocks because I am bearish on the economy.
    Sep 13 11:08 PM | 3 Likes Like |Link to Comment
  • The Longer Bond Yields Stay Low, The Higher Stocks Will Go [View article]
    Personally, I think the CAPE is useless. The noise-to signal ratio is too high. I use the ERP.
    Sep 13 02:32 PM | Likes Like |Link to Comment
  • The Longer Bond Yields Stay Low, The Higher Stocks Will Go [View article]
    The CAPE has had you in cash since the Crash. How's that working out?
    Sep 12 05:12 PM | 1 Like Like |Link to Comment
  • The Longer Bond Yields Stay Low, The Higher Stocks Will Go [View article]
    The expected return from stocks = the earnings yield + earnings growth. It is not a forecast of price appreciation. Stocks don't have to go up to provide a return to the shareholder. That is why Buffett likes low stock prices.
    Sep 12 11:19 AM | Likes Like |Link to Comment
  • The Longer Bond Yields Stay Low, The Higher Stocks Will Go [View article]
    I am referring to bond yields, not the funds rate.
    Sep 12 11:18 AM | Likes Like |Link to Comment
  • Why This Market Rally Is So Unloved [View article]
    Since Carter left office, the Dow has risen from below 1000 to 17000. Bonds?
    Sep 11 11:26 PM | Likes Like |Link to Comment
  • Why This Market Rally Is So Unloved [View article]
    They have since 1980.
    Sep 11 11:23 PM | Likes Like |Link to Comment
  • Why This Market Rally Is So Unloved [View article]
    Stock prices are rising because bond yields are falling. Bond yields are falling because the Fed is tightening in the face of weakness. The ERP is far above where it was pre-Crash. Buy now.
    Sep 11 11:22 PM | Likes Like |Link to Comment
  • The Longer Bond Yields Stay Low, The Higher Stocks Will Go [View article]
    Stock prices don't have to rise for stockholders to make money. Stock prices stayed low from the Crash until the fifties, but the earnings yield was far above bond yields (and bonds prices fell). Rich people did very well over this period. While I would prefer low stock prices and high earnings yields to high prices and low yields, I will take a modest earning yield today over an abysmal bond yield. I have no choice. Damodaran says that the expected return from stocks today is 8%. That beats bonds (2.5%), cash (0%) and gold (0%).
    Sep 11 11:15 PM | 1 Like Like |Link to Comment
  • End Europe's Deflationary Mess With A 4% Nominal GDP (Level) Target [View article]
    It is much easier to prevent deflation than to reverse it because expectations become "anchored", and because of the liquidity trap. For the ECB to successfully reflate would require shock and awe on a scale beyond even Draghi's imagination. A little QE will do absolutely nothing, and its failure will only reinforce deflationary psychology. Also, its failure will allow the Austrians to say "See--it doesn't work!" The eurozone is simply not fixable without a complete intellectual revolution at the ECB, led by Club Med. Sadly, few Europeans have even heard of market monetarism.
    Sep 11 10:09 PM | Likes Like |Link to Comment
  • The Longer Bond Yields Stay Low, The Higher Stocks Will Go [View article]
    Tight money keeps inflation low. Policy is tightening and getting tighter.
    Sep 11 09:59 PM | 2 Likes Like |Link to Comment
  • The Scottish Referendum May Already Be A Black Swan [View article]
    It has been reported that the Scottish business community has remained silent because because Alex Salmond threatened retribution if they spoke against independence. But they don't support it for obvious reasons, and I am confident that they have contingency plans.
    Sep 11 10:36 AM | 1 Like Like |Link to Comment
  • Who Determines Interest Rates? [View article]
    The Fed actively controlled bond yields during WW2.
    Sep 10 04:51 PM | Likes Like |Link to Comment
COMMENTS STATS
909 Comments
627 Likes