How to lose a trade war before it even begins

As we wait for Donald Trump's first State of the Union address, investors are left to wonder which Trump will show up before Congress on Tuesday. Will it be Teleprompter Trump, whose well-crafted speech will be interpreted favorably by the markets, or Twitter Trump, whose utterances will spook the markets?     Why tariffs won't...

Sleepwalking toward a possible trade war

Sometimes misunderstandings can lead to enormous adverse consequences. In 1941, Japan believed that war was inevitable with the United States. The Americans had slapped a trade embargo on Japan, and made it clear that Japanese occupation of China was unacceptable. The Japanese High Command saw that America was a big industrialized country with resources that...

Bubbleology 102: What could derail this momentum driven rally?

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...

Could a Trump trade war spark a bear market?

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...

Relax! NAFTA isn’t going to collapse

As American, Canadian and Mexican negotiators meet for a fifth round of NAFTA discussions in Mexico City, CNBC reported that a number of analysts are projecting significantly high odds that the trade pact would fall apart: Jens Nordvig, Exante Data CEO, sent out a warning note Monday that his firm now sees a 30 to...

To BAT or not to BAT? Trump’s tax reform dilemma

As the market awaits the FOMC decision and statement this week, there are a number of other critical market moving events to watch for. The Trump White House is expected to release its "skinny budget" this week, which may contain some broad outlines of the tax reform package. In addition, Angela Merkel's White House visit...