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gmihran

gmihran
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  • Why U.S. Stocks Will Keep Powering Higher [View article]
    Hi Harm, thanks for the clarification ... sometimes it's hard to read between the lines. We agree ... and it looks like the Fed actually agrees with my concerns regarding fundamental valuation. From the written Monetary Policy released today ...

    "...signs of risk-taking have increased in some asset classes. Equity valuations of smaller firms as well as social media and biotechnology firms appear to be stretched, with ratios of prices to forward earnings remaining high relative to historical norms."
    Jul 15, 2014. 02:36 PM | Likes Like |Link to Comment
  • Why U.S. Stocks Will Keep Powering Higher [View article]
    Oh Harm, don't be so naive ... rates artificially held low by the Fed for a sustained period of time do not reflect economic reality. If the economy was really what the bureaucrats and academics say it is, rates would be rising to reflect the increasing demand for capital investment. The Fed QE/interest rate policy over the past few years has been very ineffective and will be catastrophic for our children/grandchildren.
    Jul 15, 2014. 02:33 AM | 3 Likes Like |Link to Comment
  • Why U.S. Stocks Will Keep Powering Higher [View article]
    It has always been amazing to me how bull/bear 'analysts' will leverage what ever gibberish they can invent near a market top or bottom to sustain and rationalize the current bull/bear trend ... and this author is no exception. e.g. '... Powering Higher'.

    The market never reflects economic reality so don't try to force it. It has always been driven by 'Financial Dark Ops' and will continue to be. The individual investor needs to leverage their own common sense and track some reflective, fundamental market valuation. It is impossible to time the market but you can minimize your own risk near market turns if you pay attention to the basics.

    For example, as of July 11, the S&P 500 has a trailing 12 mo PE = 19.13 ... and more astounding, a forward-looking 12 mo estimate PE = 16.54 ... the highest forward PE since the last bubble burst in 2002. Enough said.
    Jul 14, 2014. 05:04 PM | 4 Likes Like |Link to Comment
  • Cynk Technology Is The New Scheme In Town [View article]
    The CLASSIC indicator of a Market Top!

    In case you're curious, they finally found the ONE employee and ONE asset:
    http://huff.to/1y4qZdJ
    Jul 11, 2014. 02:11 PM | 2 Likes Like |Link to Comment
  • Small caps hit hardest as stocks tumble [View news story]
    The Russell 2000 is beyond over-valued ... it has a long way to fall before becoming reflective of real underlying value. Today, the R2000 has a TTM PE of 86.73 versus 31.65 a year ago. While it is typically higher than the NDX (TTM PE = 21.77) and SPX (TTM PE = 18.91), I don't remember a R2000 metric this extended ... except back in 2007 ;-)
    Jan 24, 2014. 03:28 PM | Likes Like |Link to Comment
  • On the hour [View news story]
    Still 'Quiet' waters run deep ... be aware of the 10-year hitting 3.0% today for the first time since July 2011. The under-performing small caps seem to understand the significance of that today.
    Dec 26, 2013. 02:49 PM | Likes Like |Link to Comment
  • The Single Most Important Metric For Stocks Says We're Too Expensive [View article]
    Sorry for the confusion Learner. I'm using stockcharts.com lingo ... $SPX = S&P 500 Index, and $USB = 30Y US Treasury Bond Price. I'm evaluating the ratio between the primary equity index relative to the valuation of long-term bonds.
    Nov 16, 2013. 03:09 AM | 2 Likes Like |Link to Comment
  • No, It's Not A Roaring Market [View article]
    bartpr, I honestly believe that in the markets, as in life, the simplest answer is always the best one. Market complexity has frightened most individual investors into paralysis these days, and the overwhelming number of technical and fundamental indicators available are like statistics that you can bend and twist to make any point.

    But equity/bond index ratios fascinate me, especially when you have the Fed manipulating interest rates to these levels. Their printing press has escalated the numerator $SPX and suppressed the denominator $USB to such levels that the ratio is waving an Orange Flag (red/yellow) based upon recent 15 year history.

    If we use 9.00-11.00 as a region of stability (subjective opinion of course), what levels would return us to a ratio of 10? Perhaps $SPX 1500 and $USB back to 150 as it was in 2012? Who knows ... but I feel we have to cross $SPX 1800 and $INDU 16K first before the traders get nervous.
    Nov 14, 2013. 10:12 PM | 1 Like Like |Link to Comment
  • The Single Most Important Metric For Stocks Says We're Too Expensive [View article]
    Watermellon, I agree completely that it is heavily Fed-driven in both the numerator $SPX and denominator $USB, and hence my original comment 'thanks to the Fed printing press' for driving both in opposite directions creating a very elevated ratio. An Orange Flag of sorts in my mind (red/yellow).

    I could be misguided but when that Fed 'cable lets go' (good analogy), $SPX will plunge rather quickly and $USB will gradually increase ~ultimately~ knocking the ratio back to a more reasonable range ... IMO between 9.00-11.00 based upon the last 15 years.

    And if you're a believer in the 'round-number' theory of extended indices, I would expect that $SPX has to cross 1800 and $INDU has to cross 16K before the mo machines start getting nervous. But then again, what do I know.
    Nov 14, 2013. 09:56 PM | 1 Like Like |Link to Comment
  • The Single Most Important Metric For Stocks Says We're Too Expensive [View article]
    All women eventually become blondes? I certainly hope not. Where do you live? I live in the Bay Area and I absolutely love California Brunettes ;-)

    Timing market peaks and valleys is impossible to predict accurately no matter how many technical or fundamental metrics your computers can process. I don't even try and, quite frankly, I really don't care. I'd much rather miss the last X% of the peak or valley than force my own naive emotions onto the market and lose 3-5X% trying.

    Rather, as a long-term investor, I compile as much simple, common sense as I can to help guide my own personal evaluations of the markets I invest in. For me and my style, the $SPX / $USB ratio is one of a dozen metrics that are my favorites because it blends equities and bonds in one simple ratio. It has kept me on the right side of the markets going up and going down, and in cash as I've been since August. And I can sleep peaceably at night :)
    Nov 14, 2013. 04:20 PM | 4 Likes Like |Link to Comment
  • The Single Most Important Metric For Stocks Says We're Too Expensive [View article]
    The $SPX / $USB Ratio has now reached a new multi-year high = 13.65 thanks to the Fed printing press.

    Yes, you guessed it ... the last time we were at these extreme values was in early 2007 on the way up to a ratio = 14.02 and in late 2007 on the way down. And before that? Yep, in mid-1999 on the way up to 16.34 and in late-2000 on the way down.

    It's just a matter of time ... extremes that are driven by greed never last. Learn from history. And if you're thinking 'but this is different ...' then you're likely to repeat 2000 and 2008 all over again.
    Nov 14, 2013. 03:34 PM | 4 Likes Like |Link to Comment
  • No, It's Not A Roaring Market [View article]
    Be careful my 'Bulls with Blinders On' colleagues ... the $SPX / $USB Ratio has now reached a new multi-year high = 13.65 thanks to the Fed printing press.

    Yes, you guessed it ... the last time we were at these extreme values was in early 2007 on the way up to a ratio = 14.02 and in late 2007 on the way down. And before that? Yep, in mid-1999 on the way up to 16.34 and in late-2000 on the way down.

    It's just a matter of time ... extremes that are driven by greed never last. Learn from history. And if you're thinking 'but this is different ...' then you're likely to repeat 2000 and 2008 all over again.
    Nov 14, 2013. 03:27 PM | 5 Likes Like |Link to Comment
  • Patterns Fitting: Stocks Go Higher At The End Of 2013 [View article]
    Disappointing article, I expected more quantitative and/or fundamental analyses to support such optimism.

    All the author is saying is that the market will continue irrationally higher because ... the market has been moving irrationally higher, irrespective of real company profits/growth.

    According to the WSJ and Birinyi, as of 10/14, the P/E for the Dow Indus = 17.22, Dow Trans = 21.85, Dow Utility = 29.66 ... Nasdaq 100 = 20.88, and the wacky Russell 2000 = 86.58! These are significantly over-valued according to traditional metrics.

    I might as well calculate a linear regression line through S&P price action to get the same result he did.
    Oct 14, 2013. 09:21 PM | 6 Likes Like |Link to Comment
  • Market recap: The Dow recovered from a 150-point drop to squeeze out a fifth straight weekly gain, but investors generally held their fire in light trading ahead of a busy economic calendar next week. Most of the action was in the tech sector, where Amazon staged a notable about-face to end 2.8% higher but Expedia sank 27%. Treasurys inched higher but fell for the week; WTI crude settled at a two-week low[View news story]
    HFT is no conspiracy my friend, it is reality. Ignore it or leverage it, but don't be naive.
    Jul 27, 2013. 02:58 AM | Likes Like |Link to Comment
  • Market recap: The Dow recovered from a 150-point drop to squeeze out a fifth straight weekly gain, but investors generally held their fire in light trading ahead of a busy economic calendar next week. Most of the action was in the tech sector, where Amazon staged a notable about-face to end 2.8% higher but Expedia sank 27%. Treasurys inched higher but fell for the week; WTI crude settled at a two-week low[View news story]
    When the Markets are dominated by high frequency robotic traders on a relatively low volume day, the Markets are easily manipulated -- bots trading back and forth with each other, leap frogging each other at a tightly controlled and calculated pace. Bring up any 5-10 minute chart for the Dow or S&P today and look at that straight 45 degree line up from 11AM to the close. It's a real shame for individual investors and takes all the ebb and flow of natural supply and demand.

    You don't have to wonder why the younger generation is staying away from equities -- they watched their parents anguish in 2001 and 2008 and remain smartly in cash.
    Jul 26, 2013. 07:35 PM | 5 Likes Like |Link to Comment
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