Yesterday morning I told you that the currencies, for the most part, were flat… That didn't last too much longer… The US printed what the media and markets thought was a fabulous New Home Sales report, and the rally in risk assets was “onâ€?! With stocks and currencies in rally mode, gold and silver backed off… I'll talk about that trading theme we've seen lately in a minute, but first… Let's talk about the housing data…
[Read more...]Are Investors Losing Faith in the So-Called “Recovery�?
July 7, 2010 By Leave a Comment
For the first time in eight trading days, the Dow Jones Industrial Average produced a plus sign – up 57 points to 9,744. The last time the Dow achieved this increasingly rare feat was on June 23, when it gained five points to end the day at 10,298 – 554 points higher than yesterday's close.
[Read more...]Investing in Gold: No Doubt About It
May 11, 2010 By Leave a Comment
I spend a lot of time worrying about how “We’re freaking doomed!” and thus I spend a lot of time crying in fear and occasionally screaming in outrage, a fact that has gotten me thrown out of a lot of bars, and which has not made me any new friends, either, which Suits Me Fine (SMF), actually, since everybody I meet seems to be a moron who cannot see the wisdom of buying gold, silver and oil to protect themselves against the ruinous inflation in prices that will follow the Federal Reserve’s creating So Freaking Much Money (SFMM) and all the rest of the world’s banks creating SFMM and all of the world’s governments (except Norway, Saudi Arabia and Hong Kong) deficit-spending their little pea-brains out.
[Read more...]Quarterly Earnings Looking Good… Time to Buy?
February 17, 2010 By Leave a Comment
We are in the midst of one of the best quarterly earnings seasons on record.
More than four out of five companies are topping consensus estimates on profits. The S&P 500, that big index of America’s largest companies, is set to break a run of nine consecutive quarterly declines in profits.
[Read more...]US Dollar: The Unsafe Safe Haven
February 17, 2010 By Leave a Comment
Stocks in, dollar out. That was the mood in the markets yesterday. One half we can understand. The other has us flabbergasted. That investors would sell the dollar seems like a no brainer. That they would buy stocks seems like a got-no-brainer. So, what gives?
First, the comprehensible: The greenback slipped about half a percent during yesterday’s trading. The papers attributed the selloff to allayed fears over Greece’s implosion and stronger economic data out of the States. For the sake of illustration, let’s pretend that Greece really is back to beach parties and ouzo-fueled debt orgies and that what passes for government “data” in the US is actually tenable (rather large concessions, you’ll surely agree). Why would people take the news as a signal to sell the dollar?
[Read more...]Economic Downturn in the Face of Infallible Markets
January 20, 2010 By Leave a Comment
Does the stock market know something we don’t? Yesterday, investors bid up prices on the Dow stocks to a new high. The index rose 115 points.
According to theory, the markets know more than any single investor, analyst or economist. In theory, the markets know everything there is to know. In theory, the markets are always right.
[Read more...]A Stock Rally on Accounting Errors?
January 20, 2010 By Leave a Comment
It seems nothing can keep a bad market down. If this bounce goes much higher, we’re going to have to review the laws of financial gravity.
The Dow Jones Industrial Average rallied 115 points in yesterday’s session, bucking Friday’s loss of about the same amount. The S&P 500 and the NASDAQ were stronger still, ending the day up 1.25% and 1.4% respectively.
[Read more...](Some) Small Caps Are Still Cheap
December 22, 2009 By Leave a Comment
We can expect that the crowd will probably be wrong. Or as Fred C. Kelly put it more emphatically: “The crowd always loses because the crowd is always wrong. It is wrong because it behaves normally.” Kelly wrote this in a little 1930 book titled Why You Win or Lose: the Psychology of Speculation. We’ll see what Kelly meant below.
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Stock Market Rally Running Out of Steam
It's always a little tricky to know exactly what an economic recovery looks like. But it's usually pretty easy to know what it doesn't look like…and it doesn't look anything like the chart below:
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