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GaltMachine

GaltMachine
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  • Key Lessons For The Coming Bear Market [View article]
    Tack,
    I get your point. I think the chart you are using is a little out of date but it's trivial.
    I think the numbers are probably nearly the same on a percentage as 2000 at this time. Regardless of the current level, the link from Doug is useful as a learning tool for those that are unfamiliar with the issue and want to know more.
    Margin Debt in Jan 2000 was $244 billion
    Margin Debt in Dec 2013 was $445 billion
    Current GDP is around $17.1 trillion so Debt to GDP is around 2.65%
    http://bit.ly/1hd0DSn
    I know you are a very careful person so I just wanted to make sure that you have the latest data.
    The margin always falls following a bear market and rises during bull market for obvious reasons so it is the recent trend line that matters the most.
    Feb 12 03:53 PM | 1 Like Like |Link to Comment
  • Key Lessons For The Coming Bear Market [View article]
    For those interested in the margin debt issue, Doug Short has a detailed analysis of the current and past record of this number as of Jan 29th, 2014:
    http://bit.ly/12gjPAx

    "The latest data puts margin debt as at an all-time high, not only in nominal terms but also in real (inflation-adjusted) dollars."
    Feb 12 10:54 AM | Likes Like |Link to Comment
  • The CBO Bombshell [View article]
    From that conservative, right-wing rag the National Journal:
    http://bit.ly/1cteMmH
    "Why I'm Getting Sick of Defending Obamacare
    Incompetence, politics, and delays frustrate advocates of health care reform."
    By Ron Fournier
    February 11, 2014
    It's getting difficult and slinking toward impossible to defend the Affordable Care Act. The latest blow to Democratic candidates, liberal activists, and naïve columnists like me came Monday from the White House, which announced yet another delay in the Obamacare implementation."
    Feb 11 01:14 PM | Likes Like |Link to Comment
  • The CBO Bombshell [View article]
    Dr,
    To anyone with an open mind it is obvious that the Obamacare legislation has been a disaster.
    Remember when in Oct 2013 Obamacare was the "Law of The Land"?
    Obama changes it every day including yesterday so who knows what it is anymore. So much for laws.
    Strange that you would advocate for a law that conveniences the few at the expense of the many and you call that compassion. That demonstrates a clear lack of empathy for the average American. You do not need to destroy an entire system to solve such a tiny problem.

    COBRA coverage allows anyone to keep their insurance coverage when they quit or lose their jobs - you are arguing about a unicorn.

    By the way, the list of non-sequiturs and red-herrings above shows your graduate education was well-spent.
    :)
    Feb 11 12:33 PM | 1 Like Like |Link to Comment
  • The CBO Bombshell [View article]
    I suspect that if this policy were called Bushcare, you would be using this information to argue exactly the opposite point.

    :)

    So we go from not enough work and a job crisis to being overworked and experiencing "job lock" in less than a month. Seriously?

    To quote Sigmund Freud: "Sometimes a cigar is just a cigar."

    "Job Lock" - that's funny & pathetic - a rare combination.
    Feb 10 03:08 PM | 1 Like Like |Link to Comment
  • The CBO Bombshell [View article]
    They just need to craft a good marketing campaign to get the message out there:

    "Obamacare - work less so you can mooch even more!"

    ;)
    Feb 10 02:13 PM | 2 Likes Like |Link to Comment
  • The Pain Has Only Just Begun [View article]
    Juds,
    Of all of the most widely cited and useless of indicators, forward PE's are near the top:
    http://bit.ly/LCp24E
    "Forward P/E Ratio for S&P 500 was also below long-term averages on October 9, 2007
    However, it is interesting to note that on the date (October 9, 2007) of the record high close for the S&P 500, the forward 12-month P/E ratio for the index was also well below both the 5-year and 10-year averages at that point in time. Although the P/E ratio was below the recent averages on that date, the value of the S&P 500 declined by more than 50% over the following 17 months."
    I noted the back and forth above with F&G and the negative comments regarding CAPE so I thought I would pipe in on the subject. The forward PE argument is a faith based argument.
    The one sure way to succeed as an investor in the long-term would be to have bought lots of stock when P/E's are in the sub 10 range. Unfortunately those times tend to be rare and require great courage to act!

    Good luck.

    By the way, I hope your forecast and Eric's is wrong. We can't afford another round of that kind of economic pain.
    Feb 6 04:16 PM | 1 Like Like |Link to Comment
  • Weighing The Week Ahead: Is The Economic Recovery Stalling Out? [View article]
    Galt,

    Sorry I should have been clearer by what I took away from the article which was that inflation is the biggest driver of real interest rates.

    Add inflation to real rates of about 1.9% on average and you get expected long bond rates - I thought that was very useful.

    So inflation at its current level suggests that the recent fall in rates is actually what should happen.
    Feb 3 10:56 AM | Likes Like |Link to Comment
  • Weighing The Week Ahead: Is The Economic Recovery Stalling Out? [View article]
    For anyone concerned about their bond funds and bond allocations relative to interest rates, this review of the subject by Lacy Hunt of Hoisington Wealth courtesy of John Mauldin was excellent:

    http://bit.ly/1afrKcf

    Provocative.
    Feb 2 11:51 AM | Likes Like |Link to Comment
  • Keystone XL report reignites battle over pipeline's impact [View news story]
    Just Say Yes!
    Feb 1 10:37 AM | 3 Likes Like |Link to Comment
  • When Good Models Go Bad [View article]
    bbro,

    Do you have an update on your 52 week rolling NSA jobless claims metric?

    Curious as to whether it is telling you anything. Noticed that since about August when we hit a real low the numbers have been creeping up.

    Thanks!
    Jan 31 10:38 AM | Likes Like |Link to Comment
  • Market Decline: Get A Grip! [View article]
    Contrarian,

    While I may not agree with your forecast, I am puzzled by the investors who are ignoring recent history - S&P sold off from about 1550 to 666 in 2009 which is about a 57% decline not far off your current forecast.

    http://bit.ly/1exwqpQ

    I guess it is recency bias at work.

    Of course it has rebounded and beyond since then so if you went to sleep from 2007 till now you would be smiling.
    Jan 29 01:58 PM | 1 Like Like |Link to Comment
  • December Existing Home Sales: The Housing Bear Market Is Back [View article]
    bbro,

    People confuse the difference between the median home price of existing versus new homes.

    Although in theory rising home prices are good, it's a double-edged sword since it makes housing less affordable based upon the 20% down-payment and the financing cost.

    Until we get no-money down again the drag from rising prices could be a real problem for affordability. Best-case scenario, I think is one in which housing is back to a utility rather than an investment and maintains a stable value.
    Jan 26 08:31 AM | Likes Like |Link to Comment
  • Three Sunday reads [View news story]
    Shouldn't France be more concerned about changing its attitude toward success?
    Jan 26 08:18 AM | Likes Like |Link to Comment
  • Barron's: Munis the best value in fixed income [View news story]
    Tack,

    Thanks for the clarification - I suspected as much. That's one of those adjectives with investment connotations :)
    Jan 13 09:04 AM | Likes Like |Link to Comment
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