If You Want To Know Where Stocks Are Headed, Don't Ask The Economy [View article]
Try looking at : J.H. Ellis, Ahead of the Curve. Both web site and book. Actually it appears that consumer expenditures (PCE) are probably the best predictor of changes in gross output and earnings in 6 to 9 months. But, it will assist you greatly in making forecasts.
Actually you wasted your time with the tests since most of that work is available on a number of sites. Not shocked that PIMCO would try such things since they fear inability to get their capital back, but GDP does not predict solvency or liquidity. In China GDP is probably fiction.
Watch Personal Consumption Expenditures (PCE is BLS work) which leads future production and inventory levels by 6 weeks. Right now consumer are still spending but declining. When prospective earnings look to be in jeopardy equity prices will likely head lower. It fits with some kind of summer swoon.
The fed speak today may trump this weeks market. As for Siegel, he is now just a talking head and a show piece for Wharton. Ignore him since refused to say what the "long run" is even when water boarded.
Market Outlook - Stocks Ignore Shaky Economic Data [View article]
Magic words are "deflation", a real fall in general price levels. It is headed that way. The rest of the data is interesting, but it is history. Look at PCE and employment levels. That tells the observer where the economy is headed. Right now it appears to be on the knife edge and could go negative. Can Obama care push consumers over the edge? Possible. No serious recession, just slowing the recovery attempt. Might turn the markets south too.
Weighing The Week Ahead: Are You Ready For Some Fedspeak? [View article]
"SLFSI to predict the maximum drawdown in the S&P 500 over the upcoming three months." This the perpetual search for the holy grail based on a belief that it exists, and would be useful if found. (yet it is a two edged sword, when IN it is either up or down -, pure volatility ?? advise stops or what)
The Stress the St Lo Fed discusses is sort of unspecified and not well scaled, so it is now turned into an indicator that can predict drawdown, if we had more data. The research paper promised will be welcomed if it materializes, but in the meanwhile the preview of the week to be is interesting. Thanks.
Lessons For This Week: Still Safe To Enter This Rally? - Part 2 [View article]
Double BBs are new to me, but there is no magic in them that is evident. Trend identification is the eye of the analyst/trader.
We have an expectations driven market, so stay in, but use stops, Look at the Average True Range over the life of a rally and set the stop accordingly. I also track volume to see if there is energy behind a move. How long can this go on? We will have to wait and see but Keynes said - longer than our capital. He was correct. Be prudent.
An Investment Strategy For The Bears [View article]
Great analysis, but the effects of the global QE now developing are troubling. Emerging markets are high on our list and we have preliminary entry points in place. But what concerns is the damage that accrues to the developed markets if the devaluations move too far, too fast. In the end that only helps the Emerging markets, but what about the developed economies? The damage could last for decades.
U.S. CPI Falls In April At Fastest Rate Since 2008 - Is It Overstating The True Rate Of Inflation? [View article]
Back to full employment? The LFPR is near 67%, U6 says that many want work but are discouraged. Nice article, but your conclusions are just short of incompetent. What would Full employment mean in the context of the current facts on labor statistics and what would the jobs be like: full time or 30 hours, and at what rate of payment?
Stocks add to gains (SPY +0.6%) as the mid-May UMich Consumer Sentiment read rises to 83.7 vs. 76.4 at the end of April and against expectations for 78. The current conditions index jumped 7.6 points to 97.5 - a new high for the economic recovery. Treasurys (TLT -0.7%) slide further. [View news story]
Might be useful if they had asked respondents about wages up/down and savings rate and told us about personal spending trends.. As it is, this survey is just for publicity.
Why The Fed May Increase QE Asset Purchases Before Pursuing Exit Strategies [View article]
Think prospectively. The Fed has options and always said it had them, but what they appear to be missing is guts. Guts to tell the world that their notions of Macroeconomics were untried until now ( will, Japan to some degree, and it lead to desperation). The Fed current fear is that they are wrong to some degree yet to be determined: No recovery possible on this path but political salvation is possible for a while longer.
We know very little, But we must play them as the Fed deals them. Interesting article, but nothing new.
Have We Solved Our Fiscal Problems? [View article]
What is your point? Forget? Worry later?
You are clever enough to know that Keynes felt that if good times occurred, it was desirable to repay the debt to some operational level. Probably just in case of another cycle or negative event. Of course, Keynes knew little or nothing about the world of the 21st century. So, his work may not apply. But surly you are not suggesting it is timely and responsible to ignore the debt levels without more. So, say how we grow the GDP: cut taxes, kill Obama care, remove regulations, and take the fences down and let talent labor in?
U.S. Economy In March - Spring Swoon Has Arrived [View article]
Appealing analysis thanks. The ECB bet is a long shot since Germany is unlikely to accept it. The focus on playing what you see is refreshing even if it leads to a cliff eventually. To your list one might added some offshore havens such Philippines, Vietnam, Thailand. Sort of like Chile too (all in various stages of growth).
The Big 4 Economic Indicators: Real Retail Sales [View article]
Your indicator series seems naked and its value unclear. If you want to know the probable direction of the market and economy, you need to first look at PCE. When PCE declines significantly over the prior 3 months it marks the start of a bear market with about 80% probability in my work. Retail sales will decline next and manufacturing will follow, leading to some sort of recession.
The data you offered is OK, but its meaning, if any, is not clear. The Jo. Ellis book, Ahead of the Curve (HBSPress, 2005) is possibly the best empirical explanation generally available for the interpretation of your numbers by lay readers.
The consumer sentiment data which came out today is a coincident indicator of little value in divining the future. Overall, the market appears stable and likely to continue up for a while.
Beware Long-Term Damage From Stock Market Bubble Forming Now [View article]
"Stock valuations are currently not symptomatic of a stock market bubble" How do you know that, by what measure?
The real danger is the reconditioning of consumers/traders response to liquidity changes. The balance/caution in consumer expectations is being destroyed. Who knows what the Fed is teaching this generation of investors? One guess is that Fed policy will in the future be (politically) expected to remain accommodative. All the pain in Congress has been drained away - "liquidity is the lost policy we have we trying to find". Watch the dollar as it strengthens we will see exports choked off, commodities plunge further, and finally the unwinding into deflation. What does the Fed do then? Save the last bullet for itself?
Yen Weakness: Buffett's 'Shot Heard Round The World' [View article]
Interesting, but hardly surprising. The Yen's journey is only starting and the dollar is rising for a time, probably 89 or near. The implications are the US export sector gets hurt and maybe badly hurt, and US stocks save health, consumer staples, maybe Reits all are likely to tank. Mr. Tepper notwithstanding. Your hopes for the recovery of US sectors based in falling commodities seems odd. PCE is falling or flat that generally translates into the onset of a slowdown in the overall economy.
The Small, But Important, Flaw In The Tepper Analysis [View article]
"I mean to analyze what is actually happening, explaining why investors should not fixate on Fed policy." Fair enough.
That said, what exactly was your contribution? Certainly you do not know anything that is not widely known about static analysis. The point is this: it is not what is logical, but what investors think is logical and how they react. Some one once said the markets can remain irrational longer than....Oh well you probably heard that one too.
Tepper and apparently you too, think this is a coming investment opportunity. Now we must allow investors to react.
If You Want To Know Where Stocks Are Headed, Don't Ask The Economy [View article]
Actually you wasted your time with the tests since most of that work is available on a number of sites. Not shocked that PIMCO would try such things since they fear inability to get their capital back, but GDP does not predict solvency or liquidity. In China GDP is probably fiction.
Jeremy Siegel: Dow 17,000 In 2013 [View article]
The fed speak today may trump this weeks market. As for Siegel, he is now just a talking head and a show piece for Wharton. Ignore him since refused to say what the "long run" is even when water boarded.
Market Outlook - Stocks Ignore Shaky Economic Data [View article]
Weighing The Week Ahead: Are You Ready For Some Fedspeak? [View article]
The Stress the St Lo Fed discusses is sort of unspecified and not well scaled, so it is now turned into an indicator that can predict drawdown, if we had more data. The research paper promised will be welcomed if it materializes, but in the meanwhile the preview of the week to be is interesting. Thanks.
Lessons For This Week: Still Safe To Enter This Rally? - Part 2 [View article]
We have an expectations driven market, so stay in, but use stops, Look at the Average True Range over the life of a rally and set the stop accordingly. I also track volume to see if there is energy behind a move. How long can this go on? We will have to wait and see but Keynes said - longer than our capital. He was correct. Be prudent.
An Investment Strategy For The Bears [View article]
U.S. CPI Falls In April At Fastest Rate Since 2008 - Is It Overstating The True Rate Of Inflation? [View article]
Back to full employment? The LFPR is near 67%, U6 says that many want work but are discouraged. Nice article, but your conclusions are just short of incompetent. What would Full employment mean in the context of the current facts on labor statistics and what would the jobs be like: full time or 30 hours, and at what rate of payment?
Stocks add to gains (SPY +0.6%) as the mid-May UMich Consumer Sentiment read rises to 83.7 vs. 76.4 at the end of April and against expectations for 78. The current conditions index jumped 7.6 points to 97.5 - a new high for the economic recovery. Treasurys (TLT -0.7%) slide further. [View news story]
Why The Fed May Increase QE Asset Purchases Before Pursuing Exit Strategies [View article]
We know very little, But we must play them as the Fed deals them. Interesting article, but nothing new.
Have We Solved Our Fiscal Problems? [View article]
You are clever enough to know that Keynes felt that if good times occurred, it was desirable to repay the debt to some operational level. Probably just in case of another cycle or negative event. Of course, Keynes knew little or nothing about the world of the 21st century. So, his work may not apply. But surly you are not suggesting it is timely and responsible to ignore the debt levels without more. So, say how we grow the GDP: cut taxes, kill Obama care, remove regulations, and take the fences down and let talent labor in?
U.S. Economy In March - Spring Swoon Has Arrived [View article]
The Big 4 Economic Indicators: Real Retail Sales [View article]
The data you offered is OK, but its meaning, if any, is not clear. The Jo. Ellis book, Ahead of the Curve (HBSPress, 2005) is possibly the best empirical explanation generally available for the interpretation of your numbers by lay readers.
The consumer sentiment data which came out today is a coincident indicator of little value in divining the future. Overall, the market appears stable and likely to continue up for a while.
Beware Long-Term Damage From Stock Market Bubble Forming Now [View article]
The real danger is the reconditioning of consumers/traders response to liquidity changes. The balance/caution in consumer expectations is being destroyed. Who knows what the Fed is teaching this generation of investors? One guess is that Fed policy will in the future be (politically) expected to remain accommodative. All the pain in Congress has been drained away - "liquidity is the lost policy we have we trying to find". Watch the dollar as it strengthens we will see exports choked off, commodities plunge further, and finally the unwinding into deflation. What does the Fed do then? Save the last bullet for itself?
Yen Weakness: Buffett's 'Shot Heard Round The World' [View article]
The Small, But Important, Flaw In The Tepper Analysis [View article]
That said, what exactly was your contribution? Certainly you do not know anything that is not widely known about static analysis. The point is this: it is not what is logical, but what investors think is logical and how they react. Some one once said the markets can remain irrational longer than....Oh well you probably heard that one too.
Tepper and apparently you too, think this is a coming investment opportunity. Now we must allow investors to react.