Tuesday Outlook: Commodities, Global Markets [View article]
I must confess to being jealous of these courageous folks who fly as seen in the video. Ditto for the duantless who buy at today's levels!
IMHO, what we have begun is a multi-year return to fundamentals, in which investors will slowly relearn that the value of equities is really based on dividends, and the liklihood of their increase with time, not "accounting earnings" and their liklihood of increase; and not on the presumption of a greater fool down the line paying more for a stock that pays no dividend. As this realisation becomes mainstream, it may result in averages close to current levels ten years from now.
Tuesday Outlook: Commodities, Global Markets [View article]
Thanks again for your efforts. Good luck with pneumonia. Treat it carefully, and avoid the Jack Daniels in the pm, as alcohol may cause/exacerbate acid reflux that can worsen (or even precipitate) pneumonia.
I am sorry to be off-subject, but the above is from experience.
Thursday Outlook: Commodities, Global Markets [View article]
Dave, Thanks for all your great postings, and don't worry about not posting. Medical science has greatly advanced, and Hopkins is amongst the best in the world. Keep up the faith and God bless Francine and you.
Friday Outlook: Commodities, Global Markets [View article]
I fully agree with your opening statement, that what initiated the 2003 rally was monetary excess, and the Fed is now implementing the same strategy.
However, there is a limit to how often and how much you can keep pumping up an economy with debt and monetary excess, and I suspect that after two back-to-back bubbles, the third will prove less durable and less sustainable, assuming it takes off in the first place, which is doubtful.
The amount of distortion suffered by the underlying real economy keeps growing. As the Fed or the government continue to pick winners and losers, allocate capital, and allocate losses and rewards, all in arbitrary fashion; the system gets closer to a centrally planned economy, and farther from a market driven economy. History has shown that centrally planned economies are unsuccessful, so another distortive bubble is likely to result in a weaker economy.
Tuesday Outlook: Commodities, Global Markets [View article]
Thanks David. Regarding replacing GM with Apple or Google in the dow, it only matters for the tourists.
I don't see any positive fundamentals. Government has taken over the economy and doing the spending, borrowing, asset allocation, and reward allocation that are normally undertaken by free market forces. They are picking unproductive losers in the financial sector as winners, whilst turning the most productive elements in society into losers, as they will have to pay for the subsidies being heaped upon the incompetents.
With the dire long-term outlook of a new form of centrally-planned crony capitalism , I've taken the recent rally as an opportunity to book some attractive gains, and will book more if the opportunity arises. I expect to be a net buyer again if and when S&P500 drop below 710, which I expect will occur when the markets recover from the shock and awe of Da Boyz, as even the latter may run for cover.
Friday Outlook: Commodities, Global Markets [View article]
"The Treasury sold $57 billion in bonds while the Fed bought $33 billion."
NBR's Suzie and other msm told us that the treasury auction was a success, and reassured us that China still has an unslakable thirst for our safe haven treasuries. So I am puzzled that the fed had to "buy" more than half. Perhaps a whiff of things to come.
Friday Outlook: Commodities, Global Markets [View article]
Dave, thanks for the great data summary and charts.
"We’re much overbought but that doesn’t seem to be slowing bulls down and you just have to stay out of the way....". Overbought, yes, but why stay out of the way? Personally, I've been feeding the hungry bull some stocks which had gotten too far ahead of their fundamentals, and I expect to re-purchase the same more cheaply within a few weeks, after we hear of their earnings and probable dividend cuts.
Tuesday Outlook: Commodities, Global Markets [View article]
David, as always, an excellent and informative article.
Out of curiosity, I clicked on your link for the novel word "sheeple" to see its "formal definition", and was appalled see: ".... elete group." "To accept the group mentaility....." One would have hoped that those who presume to post an on-line dictionary would first learn to spell!
"In another twist that creates new ways to describe stocks as cheap....."
If all these folks had been as creative to describe them as expensive, when they truly were, millions of gullible innocents would have been better off. I'd go farther and suggest that the market would not have bubbled as high, and the economy would have been much better today.
The reality is that stock are just back in the general vcinity of their historic long-term trend curve. It is fascinating that Alan Greenspan observed the "irrational exuberance" that had taken hold in the mid-90's, but then proceeded to inflate history's largest bubbles. Each of history's previous bubbles was followed by a respectable period of contrition and atonement to the "gods of the market", but this time Dr. Greenspan managed the remarkable feat of history's only consecutive back-to-back bubbles, without the usual intervening period of sobriety!
Tuesday Outlook: Commodities, Global Markets [View article]
IMHO, what we have begun is a multi-year return to fundamentals, in which investors will slowly relearn that the value of equities is really based on dividends, and the liklihood of their increase with time, not "accounting earnings" and their liklihood of increase; and not on the presumption of a greater fool down the line paying more for a stock that pays no dividend. As this realisation becomes mainstream, it may result in averages close to current levels ten years from now.
Tuesday Outlook: Commodities, Global Markets [View article]
I am sorry to be off-subject, but the above is from experience.
Thursday Outlook: Commodities, Global Markets [View article]
Friday Outlook: Commodities, Global Markets [View article]
However, there is a limit to how often and how much you can keep pumping up an economy with debt and monetary excess, and I suspect that after two back-to-back bubbles, the third will prove less durable and less sustainable, assuming it takes off in the first place, which is doubtful.
The amount of distortion suffered by the underlying real economy keeps growing. As the Fed or the government continue to pick winners and losers, allocate capital, and allocate losses and rewards, all in arbitrary fashion; the system gets closer to a centrally planned economy, and farther from a market driven economy. History has shown that centrally planned economies are unsuccessful, so another distortive bubble is likely to result in a weaker economy.
Tuesday Outlook: Commodities, Global Markets [View article]
I don't see any positive fundamentals. Government has taken over the economy and doing the spending, borrowing, asset allocation, and reward allocation that are normally undertaken by free market forces. They are picking unproductive losers in the financial sector as winners, whilst turning the most productive elements in society into losers, as they will have to pay for the subsidies being heaped upon the incompetents.
With the dire long-term outlook of a new form of centrally-planned crony capitalism , I've taken the recent rally as an opportunity to book some attractive gains, and will book more if the opportunity arises. I expect to be a net buyer again if and when S&P500 drop below 710, which I expect will occur when the markets recover from the shock and awe of Da Boyz, as even the latter may run for cover.
Friday Outlook: Commodities, Global Markets [View article]
NBR's Suzie and other msm told us that the treasury auction was a success, and reassured us that China still has an unslakable thirst for our safe haven treasuries. So I am puzzled that the fed had to "buy" more than half. Perhaps a whiff of things to come.
Friday Outlook: Commodities, Global Markets [View article]
"We’re much overbought but that doesn’t seem to be slowing bulls down and you just have to stay out of the way....". Overbought, yes, but why stay out of the way? Personally, I've been feeding the hungry bull some stocks which had gotten too far ahead of their fundamentals, and I expect to re-purchase the same more cheaply within a few weeks, after we hear of their earnings and probable dividend cuts.
Tuesday Outlook: Commodities, Global Markets [View article]
Out of curiosity, I clicked on your link for the novel word "sheeple" to see its "formal definition", and was appalled see:
".... elete group."
"To accept the group mentaility....."
One would have hoped that those who presume to post an on-line dictionary would first learn to spell!
Wednesday Outlook: Commodities, Emerging Markets [View article]
If all these folks had been as creative to describe them as expensive, when they truly were, millions of gullible innocents would have been better off. I'd go farther and suggest that the market would not have bubbled as high, and the economy would have been much better today.
The reality is that stock are just back in the general vcinity of their historic long-term trend curve. It is fascinating that Alan Greenspan observed the "irrational exuberance" that had taken hold in the mid-90's, but then proceeded to inflate history's largest bubbles. Each of history's previous bubbles was followed by a respectable period of contrition and atonement to the "gods of the market", but this time Dr. Greenspan managed the remarkable feat of history's only consecutive back-to-back bubbles, without the usual intervening period of sobriety!