5. Historically, housing has generally kept up with inflation (whereas stocks have generally performed negatively in real terms—which takes into account inflation). For example, look at the negative real returns on stocks during the 70’s; compare that to real value of housing that stayed flat during the 70’s (housing prices moved up in line with inflation).
Unlike new issue stocks that are brought to market with price restrictions until the deal is sold, most municipal bonds are free to trade at any time once they are purchased by the investor. Professional traders regularly trade and re-trade the same bonds several times a week. A feature of this market is a larger proportion of smaller retail investors compared to other sectors of the U.S. securities markets. Some municipal bonds, often with higher risk credits, are issued subject to transfer restrictions.
As I mentioned last week, I no longer feel that it is prudent or productive to discuss solutions to our economic woes. The problems that we already, or are about to face are no longer solvable. The system has been damaged to such an extent, that it cannot be fixed. The series of events that is responsible for the deterioration, decimation and decay of our economic system has already occurred. The genie, so to speak, cannot be put back in the bottle. Therefore, I think we should focus on strategies that might enable us to adapt and adjust in a manner that will allow the reset to be as painless as possible. Read More
Murphy also included the District of Columbia in his research, and found it had a psychopathy level far higher than any other state. But this finding is an outlier, as Murphy notes, as it’s an entirely urban area and cannot be fairly compared with larger, more geographically diverse, US states. That said, as Murphy notes, “The presence of psychopaths in District of Columbia is consistent with the conjecture found in Murphy (2016) that psychopaths are likely to be effective in the political sphere.”
Presidential Tweets Express Anger at the FedThe catalyst today was more tweets from President Trump where he is expressing anger, not only at the Federal Reserve, and at the ECB and at the Bank of China, because he is accusing both Europe and China of being currency manipulators; taking advantage of us by weakening their currencies. He's saying ...…
Leuthold Group chief investment strategist and economist Jim Paulsen was cautious about stocks ahead of the January-February rout. And he remained steadfastly cautious in front of the recent sell-off. He’s made a lot of good market calls like these in the 20-plus years I’ve tracked his work and known him. Now in the current weakness, he’s turning more bullish on stocks.
In 2007, John Del Vecchio managed a short only portfolio for Ranger Alternatives, L.P. which was later converted into the AdvisorShares Ranger Equity Bear ETF in 2011. Mr. Del Vecchio also launched an earnings quality index used for the Forensic Accounting ETF. He is the co-author of What's Behind the Numbers? A Guide to Exposing Financial Chicanery and Avoiding Huge Losses in Your Portfolio. Previously, he worked for renowned forensic accountant Dr. Howard Schilit, as well as short seller David Tice.
At the center of everything we do is a strong commitment to independent research and sharing its profitable discoveries with investors. This dedication to giving investors a trading advantage led to the creation of our proven Zacks Rank stock-rating system. Since 1988 it has more than doubled the S&P 500 with an average gain of +25.32% per year. These returns cover a period from January 1, 1988 through November 5, 2018. Zacks Rank stock-rating system returns are computed monthly based on the beginning of the month and end of the month Zacks Rank stock prices plus any dividends received during that particular month. A simple, equally-weighted average return of all Zacks Rank stocks is calculated to determine the monthly return. The monthly returns are then compounded to arrive at the annual return. Only Zacks Rank stocks included in Zacks hypothetical portfolios at the beginning of each month are included in the return calculations. Zacks Ranks stocks can, and often do, change throughout the month. Certain Zacks Rank stocks for which no month-end price was available, pricing information was not collected, or for certain other reasons have been excluded from these return calculations.
The Trimtabs CEO said that, even accepting the argument about annual rebalancing and the fact that an aging demographic has greater need for income investments, investors could choose to go into cash or cash equivalents instead of bonds likely to go down in value. Some bank certificates of deposit are now yielding as much, in some cases more, than Treasurys. "There are other asset classes than stocks and bonds," Santschi said. "There's cash, real estate, commodities, precious metals."
4. While 5% real annual return doesn’t seem like much, it is a highly stable and secure return. How would stocks fair in that same time frame? Taking into account a 2% annual inflation rate, you would need a 7% nominal annual return on stocks to keep up with a 5% real return on a house. What if inflation goes to 4% or higher? Can you imagine a sustained nominal return on stocks of 9% or higher (to achieve a 5% real return on stocks)??
Basically, the strategy is to go long unless the unemployment rate is rising and the price trend is falling. Unemployment is rising if the reported rate is above its trailing twelve-month moving average and price trend is falling if the S&P 500 is below its trailing ten-month moving average. “Livermore” found that this indicator beats all others over the period from 1930 to 2016.
It is difficult to find the words to describe just how serious America’s trade war with China is becoming. As you will see below, the two largest economies on the entire planet are on a self-destructive course that almost seems irreversible at this point. The only way that this trade war is going to come to a rapid conclusion is if one side is willing to totally submit and accept an extremely bitter and humiliating defeat on the global stage, and that is not likely to happen. Read More
Appeal Case: “I was not sure where to find help until I found your financial aid appeal page. Your service is exceptional, and that is rare these days. Just one of your strategies saved us over $8,000. I have told many people about what you are doing to help us, and I intend to tell everyone that I meet. Most of my acquaintances also have children in college. Thank you.” –Sherry H. Maryland [ Appeal Award $29,000]
CHECK OUT Buying Bitcoin is Like Buying Airhttps://youtu.be/XmMQAuO62gIGM Hit New Low for the YearIf you want to look at some of the signals you're getting from the markets, look at the automobile stocks: General Motors and Ford, which are basically the only 2 automobile companies we have left. (Chrysler is now owned by Fiat.) They both hit 52- ...…
However, other indicators suggest an intermediate-term bottom is in place. Bullish sentiment among ordinary investors is even lower than that seen at the 2009 market lows, while Merrill Lynch’s latest monthly fund manager survey shows institutional investors are holding more cash than at any time since 2001 – an “unambiguous buy” signal, says Merrill. Allocations to equities have plunged to levels unseen since the market bottoms of mid-2011 and mid-2012. All this indicates last week’s rally may have legs. However, a multi-week or even a multi-month rally would not mean the danger has passed. Fat Pitch blogger Urban Carmel last week noted there were seven bear market rallies in 2008-09, with three lasting six to eight weeks. Stocks always gained a minimum of 7-8 per cent, twice bouncing by at least 20 per cent.
I want you to understand this. This was no speedy drive by. This was a 16-hour trip, by two U.S. warships enforcing their right to travel international waters -- waters that China would obviously dispute the use of the word "international" as descriptive. The U.S. ships were shadowed by Chinese warships. This is cold war behavior. Been there, done that.
Robert J. Shiller, a 2013 Nobel laureate in economics, is Professor of Economics at Yale University and the co-creator of the Case-Shiller Index of US house prices. He is the author of Irrational Exuberance, the third edition of which was published in January 2015, and, most recently, Phishing for Phools: The Economics of Manipulation and Deception, co-authored with George Akerlof.
Swing Trading means scaling-out of over-bought and overvalued assets, to enable buying back-in at lower prices. Exceptional Bear's strategy strives to reduce average cost and risk, while continually compounding profit. By anticipating, and positioning ahead of the herd, the market often comes to us. Swing Trading the right asset classes is the essence of managing a recession-proof and depression-proof portfolio. In the likely event of a Crash, this low-risk strategy will "make" a relatively few investors for a lifetime, while the vast majority of former investors will be broken for a lifetime.
In our 2018 Year Ahead, we compiled a list of bear market signposts that generally have occurred ahead of bear markets. No single indicator is perfect, and in this cycle, several will undoubtedly lag or not occur at all. But while single indicators may not be useful for market timing, they can be viewed as conservative preconditions for a bear market. Today, 13 of 19 (68%) have been triggered.
Living Wealthy is a digital publication of Wealth Factory where we share timely trends, news stories, and current events that affect your life. We help you see the impact, personally and socially, and give you possible solutions to avoid any negative effects. We also give you additional links and resources if you want to investigate further. The purpose is not to be the last word on any topic. Rather it’s to help us all stay informed of what’s going on in the world without letting those events negatively impact your lifestyle. Our goal is to help us all live richer, fuller lives from a position of financial strength. This allows you to weather economic hard times, and seize whatever new opportunities arise in our changing world.
JOIN PETER at the New Orleans Investment Conferencehttps://neworleansconference.com/conference-schedule/A Very Volatile and Technically Weak Trading Day for the DowHere I am for the third day in a row doing a podcast. It's market volatility that has brought me to the mic yet again. The Dow Jones down 525 points; a very volatile and technically ...…
Exceptional Bear is the leading Market Timing Service tailored to the individual investor. If you are confident in taking a leading role in your own investment decisions, trusting your own judgement above that of any expert. You have come to the right place for exceptional guidance. Our track record includes the all-time record Bear Market performance in stocks. When the S&P plunged 37% in the 2008-2009 Financial crisis, clients who followed our independently-verified guidance earned in excess of 360%. Since then, Exceptional Bear has been awarded Timer Digest's Timer of the Year in 2015, the #2 Stock Timer by a nose in 2014 and Bond Timer of the Year in 2013. Such outstanding performance in down and flat markets is an objective measure of New-Wave Elliott mastery, the cutting-edge tool for managing portfolios during wildly volatile Bear Market dives.
If you believe that there will be a significant change in global economic paradigms over the next 10 years, consider this book as part of developing an applicable investment strategy. Basically the author is focusing on commodities as they will do well in an inflationary period and, reading between the lines, commodities never go to zero (unless one is so leveraged up that one is forced to sell when commodities sell). Fortunately for us small investors the author does provide a road map to utilize his strategy by way of ETFs. With the government rolling the printing presses to shore up and stimulate our economy, inflation will result. This book examines the issues with inflation and how to invest in response.
Are the metals markets ending a price correction in unison and preparing for a massive price advance? This is the question we asked our research team to investigate and their findings may help skilled traders identify great opportunities in the future. This multi-part research article will share our most recent opinion about the metals markets as well as share some critical new data that can shed some light into what we believe will become a massive upside price rally in the metals markets. Let's get into the data. Read More
In closing, EvG says, “. . . At some point, all hell will break loose. There is no question about it. It could be something very serious coming this autumn. The whole political system is fighting against Trump, and that is going to be tough, very tough. . . . The markets are giving me the signal that things are going to turn in the autumn, and you can easily find a number of catalysts for this to happen.” Read More
I suspect there’s a hidden agenda behind the announcement in The Wall Street Journal op-ed by former Hillary Clinton aide Mark Penn that the Ole Gray Mare is actually eyeing another run for the White House in 2020. No, it’s not just that she would like to be president, as she averred on video last week in a weak moment, or that she has decided late in life to go full Bolshevik policy-wise. It is to establish her in the public mind as a serious candidate so that when she is indicted a hue-and-cry will arise that the move is a purely political act of revenge by the wicked Trump. Read More
Bacarella agrees that the current selling is not the start of a bear market. So he’s watching FAANG stocks and tech stocks, such as Amazon.com AMZN, +5.28% Alphabet GOOGL, +2.51% GOOG, +2.42% and Adobe ADBE, +2.84% for roughly 5% declines below where they traded Wednesday, to add to those names. He says he’d add Apple AAPL, +1.35% if it fell another 13%. “These are important support levels.”
Economists’ forecasts today, with very few exceptions, are a waste of time and downright misleading. In 2016, we saw this spectacularly illustrated with Brexit, when the IMF, OECD, the Bank of England and the UK Treasury all forecast a slump in the British economy in the event the referendum voted to leave the EU. While there are reasonable suspicions there was an element of disinformation in the forecasts, the fact they were so wrong is the important point. Yet, we still persist in paying economists to fail us. Read More
How is today's CAPE impacted by the oversized contribution of the large tech firms to the index? Is there merit in excluding the FAANG companies from the measure to determine a more traditional measure. With the exception of Alphabet and Apple, the other of the large tech companies would have very lofty valuations with very little historical earnings and thus would attract astronomical CAPE ratios; and given their relative size, would have a disproportionate impact on the overall CAPE measure. I guess the question is whether the CAPE measure is appropriate given the composition of the index these days, or whether the actual valuations for these companies is appropriate. Would be interested in others' views on this.
This reliance on US strength hasn’t been a problem for the past seven decades, but times are changing. Since the financial crisis, the US has been less willing to bear the costs needed to be the guarantor of the international order. Niall highlights the inaction over Russia’s annexation of Crimea in 2014, and the “little more than cosmetic” strikes against Syria as signs that the US is starting to take a more ambivalent approach to global conflicts.
The key thing to realize is that the debt cycle plays the main role in the business cycle. When debt and interest rates are low, consumers and businesses start buying and expanding, which results in economic growth. When that goes on for a while and debt and interest rates get too high, consumers and businesses run into problems, which results in recessions and bear markets.
Led by the S&P, the next move in global equities is a black-hole plunge. Rather than protect long portfolios with Puts, why not liquidate them entirely? The Fed's stimulatory hand is played-out, & the impending Crash will strike with such force that the Silver Bullet from the past will no longer suffice to resuscitate the market. Since the market forecasts the economy more accurately than any economist, this time it's we, who must bite the Silver Bullet. Genuine Bull Markets reflect economic expansion by sub-dividing into 5-waves; Bear Market Rallies, like the Roaring Twenties, and Bernanke's megalomaniac Put are illusory, 3-wave upsides within larger Bear Markets. Only a 5-wave Crash is final. Artificial stimulus is an illicit drug, for which the Fed is the Global Pusher . Rather than more ?hair of the dog?, addicted economies can only heal via cold turkey abstinence. In return for numbing the pain of economic contraction, we have prevented healing the addiction, to dramatically aggravating the economy's ability to heal. By distorting economic incentives to divert capital away from the most worthy ventures, stimulus has exacerbated excess to perpetuate illusory Bubbles. The price of stimulus is a far more austere & enduring Depression, required to wring-out the excess via a rapid, downward GDP spiral to back-out stimulus in its entirety. Once the dollar collapse gains momentum to become universally recognized, the massive exodus out of the Dollar-denominated assets will force interest rates to skyrocket, to balloon the national debt out of control. As documented by Rogoff and Reinhart documented, This Time is NEVER different - eight centuries of financial Folly -a US default of
Once upon a time, there was a little-known energy company called Enron. In its 16-year life, it went from being dubbed America’s most innovative company by Fortune Magazine to being the poster child of American corporate deceit. Using a classic recipe for book-cooking, Enron ended up in bankruptcy with jail time for those involved. Its shareholders lost $74 billionin the four years leading up to its bankruptcy in 2001.
I don't believe the developing bear market is an "end of the financial world event." We already had that in 2008. There is a difference between bears and collapses. Bear markets are normal, healthy corrections that refresh the markets and economy with creative destruction. There is almost no reason to believe that an economic collapse is imminent even if financial fleas are apparent. I will talk about that in a series of columns in coming weeks.
Obviously nobody knows for sure. That is what makes investing interesting and sometimes downright scary. But we need to parse through the data available and find where our convictions lie. This article is meant to give readers all the ammunition they need to discern a position for themselves but we will also provide our assessment at the end. It is fine to disagree. We need investors on both sides of the argument. That is what makes up a marketplace in the first place.
Looking past 2018, the Fed's outlook is even more bearish for the bond market. The central bank boosted by one the number of rate hikes it expects in each of 2019 and 2020. At the same time, its unemployment rate projections were lowered to an eye-popping 3.6 per cent and its inflation estimate rose above its 2 per cent target level, to 2.1 per cent.