I have been a gold bull for quite some time. I highlighted its bullish potential in early 2024 when it staged an upside breakout to an all-time high at 2100. Last November, I reiterated my bullish view with the publication, 2025 High Conviction Idea: Gold. Since then, gold prices have gone parabolic and soared to...
Mid-week market update: As the bulls and bears battle it out during this phase of consolidation, it's time to set out some lines in the sand to see which side has the upper hand. The accompanying chart shows the S&P 500, the equal-weighted S&P 500, and the Russell 2000, along with their respective rising trend lines...
Preface: Explaining our market timing models We maintain several market timing models, each with differing time horizons. The "Ultimate Market Timing Model" is a long-term market timing model based on the research outlined in our post, Building the ultimate market timing model. This model tends to generate only a handful of signals each decade. The Trend...
While I am intermediate-term bullish on stocks, I am also increasingly concerned about the narrowness of market leadership. Market leadership continues to be concentrated in the Magnificent Seven, as the equal-weighted S&P 500, which represents the average stock, lags the index. Here is what this means from top-down macro and a chartist’s viewpoints....
Mid-week market update: The stock market has seen a remarkable recovery. After a -2.7% wipeout on Friday, the S&P 500, the equal-weighted S&P 500, and the Russell 2000 all recovered back above their rising trend lines. Are the bulls back in town? The Bull Case Here is the bull case for a...
Preface: Explaining our market timing models We maintain several market timing models, each with differing time horizons. The "Ultimate Market Timing Model" is a long-term market timing model based on the research outlined in our post, Building the ultimate market timing model. This model tends to generate only a handful of signals each decade. The Trend...
Are we in an artificial intelligence investment bubble? That’s becoming the narrative in the financial media. A search on Bloomberg for “AI bubble” showed elevated number of stories, with a peak in January 2025 after the news of the DeepSeek breakthrough. In practice, what does that mean for equities, and the economy? ...
Mid-week market update: As the stock market grinds upward, I am seeing different variations of "it's a little too quiet out there" warnings from market analysts. One example is the growing gap between the implied volatility (IV) of the S&P 500 and the historical realized volatility (HV). Eventually, something has to give. It usually...
Preface: Explaining our market timing models We maintain several market timing models, each with differing time horizons. The "Ultimate Market Timing Model" is a long-term market timing model based on the research outlined in our post, Building the ultimate market timing model. This model tends to generate only a handful of signals each decade. The Trend...
The September FOMC meeting concluded with the Fed opting for a quarter-point rate cut. Newly appointed Fed Governor and Trump ally Stephen Miran dissented and voted for a half-point cut. More astoundingly, the dot plot showed an outlier calling for a Fed Funds rate below 3% in 2025, which requires 1.25% in rate cuts over...
Mid-week market update: Even as the equal-weighted S&P 500 touched another all-time high today, it was a marginal upside breakout. Here are the bull and bear cases for the near-term outlook. Bull Case Risk appetite indicators are confirming the stock market advance. Credit market risk appetite, as measured by the relative performance...
Preface: Explaining our market timing models We maintain several market timing models, each with differing time horizons. The "Ultimate Market Timing Model" is a long-term market timing model based on the research outlined in our post, Building the ultimate market timing model. This model tends to generate only a handful of signals each decade. The Trend...
This is the third in a series of the opportunities and threats to productivity. This week, I address the issue of climate change (also see AI Productivity and the Promised Land and Will America get old before it becomes Great Again?). The World Health Organization recently issued a joint report with the World Meteorological...
Preface: Explaining our market timing models We maintain several market timing models, each with differing time horizons. The "Ultimate Market Timing Model" is a long-term market timing model based on the research outlined in our post, Building the ultimate market timing model. This model tends to generate only a handful of signals each decade. The Trend...
This is the second in a series of the opportunities and threats to productivity. This week, I focus on the effects of labour supply on productivity, (see AI Productivity and the Promised Land). I am grateful for the aid and guidance from New Deal democrat for his help in data sourcing and analysis in the...
Mid-week market update: Scheduling notice - I will be traveling for the next 10 days. Barring wild market volatility next week, there will be no mid-week market update next Wednesday, but regular commentaries will be published each weekend. It's always tricky to write a market commentary on the day of the FOMC meeting, as...
Preface: Explaining our market timing models We maintain several market timing models, each with differing time horizons. The "Ultimate Market Timing Model" is a long-term market timing model based on the research outlined in our post, Building the ultimate market timing model. This model tends to generate only a handful of signals each decade. The Trend...
This is the first in a series of the opportunities and threats to productivity. I begin the series with a focus on the productivity effects of AI adoption. There has been a lot of excitement over the productivity-enhancing promise of artificial intelligence. From a policy perspective, productivity is important as it defines the rate...
Mid-week market update: The combination of the Quarterly Census Employment and Wages (QCEW) weakness and a soft PPI report has moved the market to expect to at least a quarter-point rate cut at the FOMC meeting next week. There are even whispers that the Fed may even move by a half-point, though the odds is...
Preface: Explaining our market timing models We maintain several market timing models, each with differing time horizons. The "Ultimate Market Timing Model" is a long-term market timing model based on the research outlined in our post, Building the ultimate market timing model. This model tends to generate only a handful of signals each decade. The Trend...
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