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WELCOME to Ross Aldridge Day Trading blog, one that seeks to provide informative news & proven techniques to enhance your trading performance. I’ll review some of the latest research on topics such as; 1 .Behavioral finance, trading & market psychology 2. Decision making processes &... More
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  • Ross Aldridge Las Vegas Nevada & RAC Consultants Detail Why Stocks Are Hitting All-Time Highs!

    Ross Aldridge Las Vegas Nevada & RAC Consultants detailed the all-time highs that the stock markets have hit in 2013.

    Travis Hoium has contributed various scenarios concerning the inflated stock markets in relationship to the United States economy.

    The year 2013 has been another great one for the stock market. The Dow Jones Industrial Average (DJINDICES: ^DJI ) is up 22.8% for the year, and it appears that nothing can upend the market's momentum. Sequestration hasn't made a dent, the government shutdown was brushed off, and even continued weakness in Europe hasn't affected U.S. stocks.

    You can see below that, not only has the Dow Jones Industrial Average gained a significant amount this year, but some of the most diverse and economically dependent companies have led the market. 3M (NYSE: MMM ) has exposure around the world, Microsoft (NASDAQ: MSFT ) is a leader in all parts of tech, and Boeing (NYSE: BA ) is dependent on businesses and consumers flying to increase profits. Yet, all three companies are up despite a pretty weak economic recovery.

    ^DJITR data by YCharts

    So, why is the stock market doing so well if unemployment is still 7.3%, and it doesn't look like the recovery has reached all parts of the economy? Let's take a look at what investors see.

    The economy is improving
    Believe it or not, the economy is getting better. Since the beginning of the year, the number of layoffs are down, the unemployment rate is down, and GDP is up.

    US Initial Claims for Unemployment Insurance data by YCharts

    These statistics may not be as good as we want, but they're improving, and that will help drive profits.

    Earnings are up
    Long-term, what drives stock prices is earnings. On that front, we're doing quite well. Let's take a look at those same three companies, and see how earnings have trended over the past three years.

    You can see below that there are some dips and dives, especially for Microsoft, which wrote down $6.2 billion in 2012 because of a botched acquisition; but, generally, the trends are higher.

    BA Net Income (NYSE:TTM) data by YCharts

    The good news here is that there's still fuel left to drive profits higher. A total of 7.3% of Americans are still unemployed and, as they get jobs, there's more money flowing through the economy.

    There's also $1.48 trillion of cash just sitting in the bank accounts of U.S. companies. When they see significant economic growth, they'll put that money to work, giving another boost to the economy.

    The economic recovery may not be as fast as some had expected, but it's happening slowly, and when it picks up steam, there will be room for profits to grow even more.

    Flow of easy money
    The final reason stocks are up significantly this year is the flow of easy money from the Federal Reserve. Not only are short-term interest rates near 0%, but the Fed is buying long-term bonds with an $85 billion per-month plan intended to keep interest rates low.

    This pushes borrowing rates for companies down, and also pushes investors into stocks and away from low-yield bonds. The money flow alone is enough to push markets higher.

    Foolish bottom line
    It may not seem like a year when the market should be up as much as it is, but there are a variety of factors pushing stocks higher. The crazy thing about the stock market is that, short term, it may not make a lot of sense at all. Next year, we could see the economy boom, and stocks fall flat.

    In conclusion, The Motley Fool charts are more of a historical overview while the Stock Markets will continue to reach higher records as long as the Federal Reserve keeps donating to the Finacial Institutions. The Federal Reserve historically had two duties. Controlling Inflation and Unemployment oversight were their past assignments. Now the Federal Reserve has taken upon itself the need to prop up the United States Stock Markets in order to maintain the dollar as the worlds reserve currency. Not a bad deal for the Financial Institutions but how long can a zero percent lending rate be justified and still maintain a viable monetary system?

    Disclosure: I am long AU.

    Tags: GS, C, BAC, WFC, MS
    Nov 10 4:40 PM | Link | Comment!
  • Ross Aldridge Las Vegas Nevada And RAC Consultants Reviews 2014 Quantitative Easing Extended And Stock Market To Raise 10 Percent In 2014 To Top 17,300!

    Ross Aldridge Las Vegas Nevada reviewed the markets influence on the Federal Reserves continued Quantitative Easing for 2014.

    Corporate profits are at historical highs while corporate hiring has been strategically delayed. The markets will benefits while the low interest for main street is proving played out. The massive redistribution of wealth has been in play for the last 8 years.

    Over four years and a few trillion dollars later, and the jury is in, so to speak, on the efficacy of what has been called "the greatest experiment" in the history of monetary policy.

    Quantitative easing doesn't work.

    At least not towards achieving either of the central bank's two core objectives; full employment and price stability. Sure it boosts asset prices, particularly in the stock market, and you bet it helps keep interest rates artificially low, but when it comes to completing that circle, and encouraging companies to hire, it's a hard argument to make.

    "Monetary policy, we think, has kind of proven that it does not add jobs," says Brian Belski, chief investment strategist at BMO Capital Markets, in the attached video. "It's really fiscal policy and fundamentals that add jobs," he says, noting that even Ben Bernanke has repeatedly made that clear.

    Of course, Belski's statement comes at a time when the Fed itself has been trying to extract itself from its $85 billion monthly binge in the bond market. As a result, Belski says the Fed has "backed itself into a corner," at least as far as unemployment is concerned, and probably won't get around to tapering until "well into 2o14." To be fair, the official unemployment rate has fallen sharply since peaking above 10% in 2009.

    Adding to his belief that the Fed will follow an extra dovish route is the fact that at least two Fed governors in the past week have begun talking down the current policy unemployment target of 6.5% as too high, and perhaps not being as reflective of an improving economy as once thought.

    "We have now reared an entire generation of investors that all they really know is to buy stocks because of monetary policy," Belski observes, noting that his own price target for the S&P 500 went up to 1,900 the moment the Fed took tapering off the table in September.

    And this is only reining-in the asset purchases, a move that is widely seen as far easier than when the day comes that the Fed actually raises interest rates.

    "We think the bond market, as it usually does, will actually react way before the Fed will be able to," Belski says of the ultimate move higher in borrowing costs. "But it's not like interest rates are off to the races anytime soon."

    As a result, he takes exception with the notion that "the risk-on trade" is tantamount to higher equity prices.

    "If you think about it, the risk-on trade is (now) bonds," he says "because of how this whole unwinding process is going to occur with the Fed."

    Ultimately, investors have to make their own bet as to when the Fed will believe that the economy is capable of standing on its own two feet. In the meantime, Belski says he's waiting for another catalyst to kick-in and takes stocks higher.

    "We think the next phase of the bull market will really be defined by fiscal policy (in Congress)," he says "and businesses coming back to America."

    In conclusion, Stock Market 17,000-17,500 by end of 2014.

    Corporation bulls WIN! Beware of 2015?

    Disclosure: The author is long SKF.

    Tags: GS, BAC, MS, WFC, Financial
    Nov 07 11:41 AM | Link | Comment!
  • Ross Aldridge And RAC Consultants In Las Vegas Nevada Reviews The Theory Of Probabilities And The Markets!

    Ross Aldridge with RAC Consultants in Las Vegas Nevada reviewed some prior warnings concerning the upcoming stock market predictions based on the theory's of probabilities not fundamentals.

    They predicted it was going to happen long ago.

    Are we talking about Nostradamus or even anything remotely as cheesy as him? We all know that was a load of baloney. Just hot air and wind! Right? The Mayans might have got it right after all. Remember, the end of the world for them didn't necessarily mean the end of the world it just meant the end of a cycle. A new cycle might begin, just different, opening up a whole new world. So maybe that cycle did begin as the door closed on 2012. January came and went and we are still here.

    But, there are people who are in-the-know and who are able to predict (or think they can) what's going to happen even years ahead of when it actually does. Yet, we only look back and then it's too late for the 'if-only' statements and weeping over the milk that got spilt. There's no point looking back and regretting anything. Might as well listen to the people that have correlated the ups and downs in the financial markets. For once! What else have you got to lose?

    If we are to believe what they said, then this is the year. 2013! It's going to happen according to them. The stock-market is ready to crash yet again this year and this time it's going to be a big one. Let's take a look at what was said, when, why and by whom.

    1. Charles Nenner

    Claimed in December 2010 that the crash would occur sometime either in 2013 or just after. Although, we might ask if that is called hedging one's bets. Nenner is a stock market analyst, right? But three years ago he developed a correlational theory that expressed the stock market moves as being influenced by sunspots.http://technorati.com/lifestyle/article/2013-catastrophic-economic-crisis-predicted/.

    Anyone that wants to predict the downturn in the market will be able to consult the predictions of the sunspot cycle viahttp://solarscience.msfc.nasa.gov/predict.shtml. That means, in fact, that sunspot cycles are predictions that will enable us to make further predictions about the economic cycle of the world. Yeah!

    2. Peter Schiff

    Predicted that the bang would occur this year too. This is the guy, you will surely recall, that was poo-pooed because he said in 2007 that the stock market crash of 2008 would occur. We were told that the economy back then had never looked so good. Now, he's predicting the crash of 2013. Can we afford to turn a blind eye to this one? There will be a huge US Dollar drop and Treasury bond crisis. He says that the banks won't hold up this time. They have been shored up once before, and they have passed Federal-Reserve tests regarding their ability to cope in the event of a crisis. But, he adds that they are not ready to pass any stress test for viability over a Treasury bond crisis like the one that is lurking behind the Fed's door this year. Shiff is one of the few that believes it's 2013 and that things are nowhere near the happy-go-lucky mark that people are spouting on about.

    http://ivn.us/2012/10/28/peter-schiff-who-predicted-the-financial-crisis-forecasts-the-worst-to-come-around-2013-2/.

    3. Jeffrey Gundlach

    Predicted the 2008 financial crisis too. Now, he is also one of the few telling us to prepare for the time-bomb that is about to explode. In January of this year, he said that the market was ready to implode. That's all because we have been living on debt that has been piling up for thirty-odd years now. In the first decade we got hooked on debt. We must have been candy-flipping back then. We really jacked up, didn't we? The second decade saw all of that go pear-shaped as we walked right into the sticky mess of the sovereign debt crises and the foreclosures. Our debt had become too big to be anything more than a big burden weighing us down. The third decade is just starting. It will involve rampant inflation that we'll obviously try to control, but that we'll make worse, debt defaulting on repayments as well as corruption galore. Lovely! Gundlach suggests that we should be moving elsewhere right now. Only problem is he doesn't tell us where! Does it all sound familiar, though?http://advisorperspectives.com/newsletters13/pdfs/2013-Market_Outlook.pdf.

    4. Robert Weidemer

    Robert Weidemer tried to get his video interview banned, but you can see it at:http://w3.newsmax.com/a/aftershockb/video47b.cfm?.

    Weidemer predicts that unemployment will hit 50% in the USA. 90% of the stock market will be wiped out and there will be inflation of 100%. Too over the top? Well, Weidemer predicted the failings of the housing market and the catastrophic result on the world's economies. The unsinkable USA almost sank because of it. Probably best to jump ship now.

    5. David Stockman

    David Stockman predicted a few months ago that we were on the next train to stock-market hell and there were no tickets left for a return journey. That's because, according to him, the Federal Reserve has been dishing out too much monopoly money. There are no real gains in the economy, just phony spoof-like patchwork. But that's ready to pull apart. How can you not believe Stockman with a name like that?http://moneymorning.com/2013/04/01/is-david-stockmans-stock-market-crash-prediction-on-target/#.UbB_tvm9ByI.

    The bursting of the dot com bubble cost us in the region of $5 trillion from 2000 to 2004 as it bust in our faces and brought the world down. That was even bigger in 2007, when it cost $7 trillion and perhaps we are still notching up the cost even today. How much is it going to cost this time?

    Believe it or refute their claims as drunken beer-talk down the local pub. But, when (or if) it happens, no point telling anyone that you didn't know. You can lay off the 'what-ifs' now. They won't wash. I'll just say "I told you so". Maybe the Mayas got it right after all. The new cycle might begin this year. Just have to figure out what that new cycle will include, don't we? The death of the dollar? The Death of our economies? A new cycle? But, hey, if the predictions were as worthy as all that, we wouldn't be doing much all day, would we? I wouldn't, at least. We would be acting on them, wouldn't we? Or maybe we are just non-believers.

    The bottom line has been drawn and there seems to be a limited downside to the artificially inflated stock markets that will enable the US Dollar to remain the world reserve currency for another decade. Ross Aldridge Las Vegas Nevada and RAC Consultants will review the Quantitative Easing continuation by the new Federal Reserve and merge the two strategies for future returns.

    Disclosure: I have no positions in any stocks mentioned, but may initiate a long position in X, NUE over the next 72 hours.

    Tags: GS, C, MS, X, NUE
    Oct 26 11:39 AM | Link | Comment!
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