Stock Market Not Ready To Handle Tapering Truth [View article]
consumers have used up their savings. consumption will have to depend on credit. pm at all time highs. dont we still have cycles. the long bull cycles depended on generational change in economics. i dont see this now. help me see the light of what this man is talking about. its easy to margin up the market with four years of gains. but i have at this point sold out recently. the rise is now parabolic and that never has ended well. at what point will pe expansion be come contraction. i can wait out at this point. having gotten back to my 2007 value.
Daily State Of The Markets: Is It Time To Hit The Pause Button? [View article]
this is a parabolic movement for the last twenty days. parabolic moves are characteristic of a bubble. it could go longer as no one can predict when it will change. but change it will as it always has. how is a parabolic move defined. using the iwm as an example, the equation y=90(1.005^x) 90 was the price of the russell 2000 some 20 days ago. x is the day 1 through 20. it fits with high correlation. power functions are parabolic in math.
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the consumer is the key to gdp growth., not qe. unless there is a new way to consumer spending this scene is entirely possible .come some liquidity crisis and it will be sooner than later.
we have reached a parabolic rise in the short term . go back 20 trading days with the iwm at 90. use the equation price=90*(1.005^x) where x is the day. it follows the iwm closely. parabolic rises lead to bubbles. this ti sno time to be in this market, period.
what about the peg at 1.4 talk about excessive value.
This entire move has been based on pe expansion way ahead of eps growth. i will wait for the day when pe contracts. contractions follow expansions.
i dont know the ages of the people that follow these articles, but after three crashes in my investments going back to 87, i will not be a buy and hold again. dont need the pain any more.
i really dont know how to play it now with all the fed interference. its all in uncharted territory. any analyst who say different is selling hot air.
S&P 500's Fundamentals: Update On Earnings, Valuation And Estimates [View article]
all this focus on eps and estimates when the market is driven by pe expansion. peg is now at 1.4. of course, what accounts for pe expansion. greed and absence of fear i for one am too dumb to make any estimates and what of their meaning.
give me some thoughts on the end of the liquidity rally so i know what too look for before the end of the bull
you are looking at the early 80's investor who has been through three crashes.
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many do not believe there is any thing as a secular bear market, yet history proves otherwise. why could it be so different now than other times like 29 49. gov failed then so their track record is poor.
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good summary of where we stand. i believe we are in one of those times where pe expansion is the big driver now. this has happened before where the eps growth may be flat for years and pe growth continues. i am in the mid 70,s so have become more cautious than in the past, but with the peg of sp at 1.4 i believe the limits are being pushed. i am glad this article did not hang on the market having a low pe ratio. as low can mean +_30 % next years return.
i am also wondering if this move is the beginning of a bubble phase, with the iwm moving up from 90 to 99 in 20 trading days.
Some Perspective On The 'Can't Lose' Market [View article]
everyone thinks that eps growth rate will automaticly drive stocks higher. it is wishful thinking. pe expansion has been the biggest stock driver. in "unexpected returns" the writer has a history of eps growth rate and pe expansions. surprisingly pe expansion rates fared best when eps growth was flat. now with the peg at 1.4 expansion may be peaking out. but no one knows this. check the study out. it is an eye opener.
you should check the history of pe expansions and eps growth in the book"unexpected return." there we have the pe growth vs eps growth. on an six y ma. expansions run on cycles of many years then peak out and decline into neg changes. significantly, the cycle ignored eps growth. ie, pe growth can be positive and eps growth flat. this may be a shocker to many fundamentalist. but the facts are there. at some point the trend will change and no amount of fed qe will change it. buying into this rally now is taking on more risk than gain, imo.
also consider that bull markets of 5.5 years age have a 80% chance of ending. will you know when it ends . i doubt it since none of your comments lend toward this fact. i sure dont know, having been through three crashes and am a bit cautious. i will patiently wait for the next crash before committing.
The Most Nagging Question About Stocks [View article]
markets where pe expansion is the main driver are hard to call and usually end by some crisis correction. most timing systems published now says the bull is still alive . my main concern is the record margin debt as a driver of price. when the correction comes it will be painful because none of these players will have control of their buy sell decisions, the market will automatically make the call. the y/y pe expansion since the 2009 bottom has been outpacing eps growth. at some point the pe expansion will decline even if eps growth begins to accelerate. check this out "unexpected growth"
the more i study the market history the more fear of loss grows.
finally, none of the above have accounted for the mini corrections from 2009, so if a mini goes to maxi, i dont see these a signals ahead of time.
you guys with your pe stuff make me laugh. why dont you tell your readers that at this point the historical range of next year return is better than +_30% "The only three questions that count" will clarify the misconception of pe analysis. read it so that your writing dont look foolish.
How To Identify Market Distortions Caused By The Fed [View article]
"unexpected returns" wrote about the history of growth y/y of eps and growth y/y of pe expansion/decrease. its turns out that pe can expand for years and eps can be flat or pe can decline for years and eps can grow. we are now into a long cycle pe expansion where no one can say when a decline will start. once in play the decline last for several years. when i saw this i began selling out, realizing a long term investor may be high now but will suffer at some point. i choose to stay out of this gamble having been caught in three out of three crashes. i will be back in after the next crisis. it will come. it always does.
S&P 500 Would Not Be Overextended At 1800 This Year-End [View article]
you forget that market peaks to peaks of 5.5 years have a 85% probability of ending. sure the current peak can go further, but who wants to risk it, especially with margin debt so high. in any event pe ratios have been a poor technique of measuring market valuation, for any number less than 25, the next years return can vary by +- 30% going back 100 years.
Stock Market Not Ready To Handle Tapering Truth [View article]
the long bull cycles depended on generational change in economics. i dont see this now. help me see the light of what this man is talking about. its easy to margin up the market with four years of gains. but i have at this point sold out recently. the rise is now parabolic and that never has ended well. at what point will pe expansion be come contraction. i can wait out at this point. having gotten back to my 2007 value.
Daily State Of The Markets: Is It Time To Hit The Pause Button? [View article]
how is a parabolic move defined. using the iwm as an example, the equation y=90(1.005^x) 90 was the price of the russell 2000 some 20 days ago. x is the day 1 through 20. it fits with high correlation. power functions are parabolic in math.
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what about the peg at 1.4 talk about excessive value.
This entire move has been based on pe expansion way ahead of eps growth. i will wait for the day when pe contracts. contractions follow expansions.
i dont know the ages of the people that follow these articles, but after three crashes in my investments going back to 87, i will not be a buy and hold again. dont need the pain any more.
i really dont know how to play it now with all the fed interference. its all in uncharted territory. any analyst who say different is selling hot air.
S&P 500's Fundamentals: Update On Earnings, Valuation And Estimates [View article]
give me some thoughts on the end of the liquidity rally so i know what too look for before the end of the bull
you are looking at the early 80's investor who has been through three crashes.
The 'Real' Mega Bears: Periodic Update [View article]
Market Outlook - Stocks Ignore Shaky Economic Data [View article]
i am also wondering if this move is the beginning of a bubble phase, with the iwm moving up from 90 to 99 in 20 trading days.
Some Perspective On The 'Can't Lose' Market [View article]
Time To Show Optimism For Stocks [View article]
also consider that bull markets of 5.5 years age have a 80% chance of ending. will you know when it ends . i doubt it since none of your comments lend toward this fact. i sure dont know, having been through three crashes and am a bit cautious. i will patiently wait for the next crash before committing.
The Most Nagging Question About Stocks [View article]
at some point the pe expansion will decline even if eps growth begins to accelerate. check this out "unexpected growth"
the more i study the market history the more fear of loss grows.
finally, none of the above have accounted for the mini corrections from 2009, so if a mini goes to maxi, i dont see these a signals ahead of time.
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S&P 500 Would Not Be Overextended At 1800 This Year-End [View article]