About three weeks ago, I wrote about opportunities in European equities (see Worried about US equities? Here's an alternative!). I pointed out that stock prices in Europe were far cheaper than US, the fears about European integrity and financial system were overblown, and the market seemed to be ignoring signs of a growth recovery. Since...
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...
Mid-week market update: The intermediate term outlook that I've been writing about for the past few weeks hasn't really changed (see Get ready for the melt-up and Party like it's 1999, or 1995?). The stock market continues to enjoy a tailwind based on the combination of overly defensive investors and a growth turnaround which is leading...
As we await the Fed`s annual Jackson Hole symposium on August 25-27, Bloomberg highlighted a research paper by Fed economist Jeremy Nalewaik. Nalewaik found that inflation and inflationary expectations had tracked each other well but started to diverge in the mid 1990's. This paper is important to the future of Fed policy, as it pushes the Fed towards...
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 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...
Mid-week market update: Is this the pullback and correction that I've been anticipating? If so, how far can it go? Be patient. Take a look at this weekly point and figure SPX chart. Is there any doubt that the intermediate term outlook is bullish? While my inner investor remains bullish based on the intermediate...
I am seeing an unusual level of rising anxiety over the political implications of Brexit. Last week, Stratfor published a report entitled "Brexit: The First of Many Referendum Threats to the EU", which detailed the threats of additional referendums to the future of Europe. Jim Rogers, writing in the Daily Reckoning, also painted a dire...
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 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...
Mid-week market update: After spending over two weeks in a narrow trading range, the SPX broke down out of that range yesterday and tested technical support at the 20 day moving average (dma), which was also the mid-Bollinger Band mark. At the height of the decline, the index had fallen 1% and the market was...
I have a suggestion for value oriented investors who are uncomfortable with my market blow-off thesis for US equities (see How to get in on the ground floor of a market bubble and Get ready for the melt-up). What about buying Europe? Valuation metrics for European stocks are certainly cheaper. The SP 500 trades at a price...
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 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...
I have long had much respect for the folks at Lombard Street Research (LSR) for their unusual non-consensus calls. Back in the days of the Tech Bubble when everyone was focused on the likes of Cisco Systems, Lucent, Nokia and other technology darlings, they had said "watch China" as the next engine of growth. That...
Mid-week market update: After the stock market rally off the panic Brexit bottom that took SPX to new all-time highs, the market has been in a tight trading range for the last 10 trading days. As the chart below shows, the 5-day RSI, which is a useful short-term trading indicator,flashed a sell signal several days...
As we approach another FOMC this week, much of the short-term tone of the market will depend on the Fed. In order to analyze what the Fed is likely to do, let`s begin with their mandate, which is price stability (fighting inflation) and full employment. In addition, the Fed has taken on a third objective...
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 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 reaction to Donald Trump`s speech to the Republican convention has been highly bifurcated. Mainstream media and analysts mostly reacted with horror and raised cautionary notes about his campaign of fear (see The New York Times and The Economist), while social media lit up with "I would totally vote for this guy" messages. ...
Mid-week market update: As stock prices have recovered strongly off the Brexit panic bottom to make a new all-time high, there are numerous signs that the market is ready to take a breather. In all likelihood, a period of sideways consolidation or minor pullback is on the horizon. Traders in a crowded long...
When I was a boy, I can remember the Zero Population Growth (ZPG) movement, which was a response to the Club of Rome's Limits to Growth Mathusian thesis of "the world has limited resources, but human population is rising exponentially and therefore ecological disaster looms". Somewhere along the way, birth rates fell in response to global...
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 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...
As we await China's Q2 GDP report in the face of sharply lower trade figures, it's useful to ponder once again the China tail-risk question. For years, analysts have been warning about impending doom in China because of the growing mountain of unsustainable debt (see Kyle Bass, Jim Chanos, Andy Xie and George Soros). ...
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