Investing

Market Internals Show Deterioration, Trend Still Bullish For Now

This past Monday I penned a piece entitled "10 Signs Of Stock Market Exuberance" which detailed some notes from the discussion that I recently had with another portfolio manager.  Interestingly, this article received a series of diametrically opposed opinions from "why are you so bearish" to "why aren't you recomm ...

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5 Things To Ponder: Macro Investing Thoughts

This past week has seen the market struggle due to continued weak economic data, rising tensions between Russia and the Ukraine and an extended bull market run.  As I discussed in yesterday's missive, the market internals are showing some early signs of deterioration even though the longer term ...

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10 Warnings Signs Of Stock Market Exuberance

Imagine that you are speeding down one of those long and lonesome stretches of highway that seems to fall off the edge of the horizon. As the painted white lines become a blur, you notice a sign that says "Warning." You look ahead for what seems to be miles of endless highway, but see nothing. You assume the sign must  ...

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A Technical Look At Margin Debt

There has been much written as of late about the continued surges in margin debt.  This was particularly the case when margin debt increased in January even as the markets declined.  My friend Doug Short recently penned his monthly update on margin debt stating: "The latest data puts margin debt at an all-time ...

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50% Profit Growth And Historical Realities

As the markets push once again into record territory the question of valuations becomes ever more important.  While valuations are a poor timing tool in the short term for investors, in the long run valuation levels have everything to do with future returns.  The reason I bring this up is that in 2013 reported ear ...

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5 Things To Ponder: Serious Stuff

There was so many good things to read this past week that it was hard to narrow it down to a topic group.  After a brief respite early this year, the markets are hitting new highs confirming the current bullish trend.  As a money manager, this requires me to increase equity exposure back to full target weightings. ...

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Revisiting Why Benchmarking Is A Bad Strategy

Just recently my friend Cullen Roche wrote a great piece entitled "Can we All Agree to Stop Comparing Everything to the S&P 500" in which he stated: "Benchmarking is a pernicious thing in financial circles.  Not only because it disconnects the way the client and a fund manager understand the concept of 'risk', bu ...

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Chart Of The Day: S&P Tracing A Top?

Chart comparisons predicting the next major market crash have abounded as of late.  Is this a repeat of 1929, 1974 or 1994?  The truth is that we are all guessing at what will happen next in the markets as no one really knows what will happen tomorrow much less six months from now.  I say that to qualify toda ...

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5 Things To Ponder: Sex, Money And The Carry Trade

In last week's newsletter, I discussed the return of "Bad News Is Good News" as the driver of the markets.  This week saw the continuation of that theme as one economic report after another came in far below expectations.  The question remains, and something I discussed this week on The Willis Report, is whet ...

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5 Years Later - What Did The ARRA Achieve?

The 17th of February, 2014, marked the annual observation of George Washington's birthday and the 5th anniversary of the American Recovery and Reinvestment Act.  Given that is has been half a decade since President Obama signed that bill into law, it would not surprise me if you did not immediately recognize what it en ...

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Complacency Rapidly Returns To The Market

The markets have bounced nicely over the last several days as the recent "crisis" in the emerging market countries has subsided.  Furthermore, Janet Yellen smoothed over many of the financial market's concerns with promises of continued accommodative support.  As shown in the chart of the volatility index below, t ...

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Markets Push Resistance As Yellen Keeps Her Foot On The Gas

The markets have been waiting patiently for several days now for Janet Yellen to make her first Congressional appearance.  The testimony, on all most all counts, was as expected.  Goldman Sachs gave a brief synopsis of key comments as follows via Zero Hedge: "Fed Chair Yellen's prepared remarks for her semiann ...

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5 Things To Ponder: Market Correction Over Or Just Starting

Over the last year, investors have been lulled to sleep wrapped in the warmth of complacency as the Federal Reserve stoked the fires of the market with $85 billion a month in liquidity injections.  I have written many times in the past that investors were likely to be rudely awakened by an unexpected event of which was ...

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Was 2009 A Generational Stock Market Low?

Just recently Barry Ritholtz wrote an article for Bloomberg Opinion comparing the stock market lows of 1942 and 1974 with 2009.  Barry starts the discussion with: "Every 30 years or so, markets make what can be described as a generational low. We can define this as a capitulatory bottom, one that might be caused by ...

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Putting The Market Mayhem Into Perspective

A recent CNBC article by Jeff Cox discussed that the current market rout stating: "As hard as policymakers have sought to assure markets that they stand at the ready when conditions weaken, lack of a consistent voice has only spurred weakness, according to an analysis released Monday.  Emerging market economies are ...

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Markets Oversold Enough For A Bounce

In this past weekend's missive, I discussed the recent issuance of an "initial" weekly SELL signal for the S&P 500 and reviewed the major sectors of the market.  I also stated that the market was oversold enough for a bounce with which to rebalance portfolios into.  This morning the markets are once again viol ...

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Is The Correction Over? Looking For Clues

After months of slumbering complacency, market participants have been awakened by the stark reality of market risks.  What goes up, it seems, can actually come down.  However, we need to put the current market correction in some context given the nearly 30% run in 2013.  From the peak of the market to Wednesd ...

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Where Does This Market Rally Rank?

Today's chart of the day is a simple analysis using Prof. Robert Shillers stock market data to look at where the current stock market rally exists in relation to previous market rallies following either cyclical or secular bear market corrections. I have analyzed the data using both nominal and real (inflation adjusted) pri ...

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5 Things To Ponder: Random Thoughts Edition

This past week I read some very diverse articles that I wanted to share with you.  Hopefully, they will stimulate your grey matter over the weekend as you indulge in melted artifical cheese, processed fillers, and copious amounts of artificial colorings and flavors during the Super Bowl showdown (I am assuming you did  ...

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