Wednesday, November 4, 2015

Interesting Commentary about Impact of Earnings on S&P 500 Value

Another insight from commenter David Young:

Rounding, distribution top in progress, a classic chart formation.  If bear markets end around 10x earnings and earnings drop another 10% into 2016, we have a market adjustment potential of 65%.  Has trading volume on the NYSE been declining all year or what?!

JUST WAIT UNTIL A GIANT HAIRBALL OF A DEFAULT COMES OUT OF CHINA OR EUROPE OR BOTH IN THE WEEKS AHEAD.  The little snowball is already going down the mountainside, and is destined to become the size of the Eiffel Tower before this First Act is over.  It will have a lot of humanoid arms and legs sticking out of it before it come to a rest in 2018.

ME THINKS THE DEVILISH NUMBER OF 666 IS IN STORE FOR THE S&P500 ONCE AGAIN, ME MATIES!  And we will be doing good to maintain and not sink well below it with another $60 Trillion in debt in the world since the Fall of 2008.  Did I say FALL?!!!

Great Explanation of Why Inflation Is So Low

Interesting insight from clovisdad, a commenter on another website:

Let's use Japan as an example.   Cutting through the "old language" of bonds and interest rates, bond vigilantes, taxes and balanced budgets, the Japanese (Bank of Japan) has concluded it can simply print all the money the government needs to borrow; and it does.

So now what's wrong with deficits?   Well, we all know that too much money chasing too few goods would cause inflation, but there's not a lot of that.  Why not? Because these economic policies murder savers, so people are forced to cut back on their purchases and contract their lifestyles, thus no inflation; while the government feasts on cheap debt for its ever expanding power..

The real consequence is that government has found an unbounded means of expansion on the backs of the citizens, who are thereby proportionately impoverished.

There is no free lunch; but governments, including our own, are now eating ours.

Monday, November 2, 2015

Stocks Near New All-Time Record Even As Earnings Hint of Recession

The Dow is up 165 points today, while this is the major headline on one of the more progressive financial new websites that I read:

Ominous Sign, Even As Stocks Near New Record Highs?

Shawn Langlois at Marketwatch shares this with us today:

The S&P’s performance relative to the U.S. dollar DXY, -0.01%  is a good indicator of bull and bear markets, according to Geoffrey Caveney of the Dr. Strangemarket blog, and right now it’s telling investors that trouble is lurking. He says the stock market has been on a steady decline against the buck for the past 16 months.
Basically, the ratio — the value of the S&P 500 index divided by the value of the Dollar Index — tends to stall out a year in advance of a bear market. It happened in 1999, and it happened again in 2007. Guess what, as you can see by the chart, it’s been a year since it started stalling out this time around. “Such a trend has never occurred during a bull market in at least the past 25 years,” Caveney explained, who added that all this pretty much indicates we’re “already in a bear market now.”

Manufacturing Struggles


And just weeks ago, manufacturing was one of the few bright spots!
It's interesting also to note that while construction spending climbed, sales have been weak in the housing market. Home mortgage defaults climbed 66% year over year.