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Economy

Nov 07 2018

Too Soon To Expect Economic Weakness?

  • Nov 7, 2018

We believe stocks have begun to discount a major inflection point in the economy and corporate profits for 2019 and 2020.

Oct 05 2018

Stock Market Observations

  • Oct 5, 2018

Throughout the spring and summer, the market could alternatively be characterized as “divergent” or “disjointed”—but until very recently it could not be considered “distributive.” Now, Mid and Small Caps have hit a short-term air pocket and breadth figures were exceptionally poor at September’s scattered highs in the DJIA and S&P 500.

Jul 07 2018

The Bulls And Bears Agree!

  • Jul 7, 2018

Yes, bulls and bears now hold their respective positions for the same reason—i.e., the U.S. economy is exceptionally strong. The stock market is accommodating this rare bipartisanship with sufficient reason to support either position.

May 05 2018

The Market Told You So

  • May 5, 2018

First quarter profits have been terrific, and this quarter’s will be too. Enjoy them, but remember that the market “paid” you for them many months ago. Don’t submit another invoice…

Jan 06 2018

Pressure Points?

  • Jan 6, 2018

The first few trading days of the new year have been a seamless extension of 2017—a low-volatility, “measured” market melt-up.

Dec 07 2017

Not A Tipping Point, But A “Toggle” Point?

  • Dec 7, 2017

Evidently, being a bull in a bull market is no longer good enough.

Jun 07 2017

Goldilocks—Enjoy It While It Lasts

  • Jun 7, 2017

The best interpretation of the current cross-asset message is the scenario of goldilocks, and there are reasons to believe this is a possible scenario for the near term.

May 05 2017

Stock Market Observations

  • May 5, 2017

The S&P 500 has labored beneath its March 1st bull market high for the last two months while underlying breadth and leadership trends have remained mostly favorable.

Apr 07 2017

Spring Forward, Fall Back?

  • Apr 7, 2017

The S&P 500 has gained about 5% on the year, respectable but hardly consistent with the “melt up” scenario we thought might occur.

Jun 07 2016

Rally Extension?

  • Jun 7, 2016

We’ve boosted equity exposure twice in the past several weeks, fully cognizant that it’s not a “textbook” time to do so.

Apr 07 2016

The Fed’s Capitulation To The Dovish Side— A Win-Win For EM & U.S.

  • Apr 7, 2016

We have mentioned a number of times that China had experienced a very unpleasant “second-hand” tightening due to its peg to the dollar. Its trade competitiveness has suffered tremendously. With a weaker dollar the Chinese Yuan can re-gain some of its competitiveness while maintaining its peg to the dollar. A rare win-win in today’s convoluted world of finance.

Mar 08 2016

Big U.S. Banks: We Have A Motion, Is There A Second?

  • Mar 8, 2016

YTD the S&P 500 has fallen 2% while the S&P 500 Banking industry group is down over 12%—a shortfall that has the attention of value investors and contrarians seeking a chance to buy high-quality banking franchises at fire-sale prices.

Oct 07 2015

Stock Market Observations

  • Oct 7, 2015

The August market break did not emerge from out of the blue. The foundation for the bear case was put in place many months before those four ugly days in late August.

Oct 07 2015

Sentiment, The Economy & The Fed

  • Oct 7, 2015

We wrote in the January book that 2015 would serve up no shortage of excuses for the Fed to hold off on tightening all year. Whatever window the Fed may have had is now closed.

Oct 07 2015

Chinese Economic Concerns Are Overdone

  • Oct 7, 2015

The traditional economic indicators are no longer as relevant as people think, and China’s condition may not be as bad as most fear.

Sep 09 2015

Recession? Too Early To Call

  • Sep 9, 2015

Among the various arguments put forward by those believing the recent decline is no more than a correction, the most difficult for us to address is the common claim that “there’s no recession on the horizon.”

Jan 08 2014

The Economy In 2014: Solid But Unspectacular

  • Jan 8, 2014

This year should be a solid but unspectacular one for the U.S. economy, with real GDP growth of about +2.5%. We expect the Consumer Price Index to rise just 1.5%. Unemployment should continue to fall.

Aug 07 2013

The Economy And Earnings

  • Aug 7, 2013

The YTD surge of 19% in the S&P 500 should ensure a stronger second half economy, and the big five-point jump in the latest Purchasing Managers Survey (ISM) might be the first evidence of this.

Jun 07 2013

Stocks And The Economy

  • Jun 7, 2013

We’ve written before about retail investors’ tendency to “conflate” stock market action with movements in the underlying economy. Misunderstanding this interrelationship generally causes the public to liquidate stocks when the economy is weak, only to ultimately buy them back when the economic recovery is obvious to all.

Aug 07 2012

Lowered Expectations — Policy Effectiveness

  • Aug 7, 2012

For central bank policy effectiveness, global economic growth, interest rates, and inflation. While lowered expectations are a good thing in the near term, long term return expectations for most asset classes should be lowered too.

Feb 04 2011

A “Late-Cycle” Economy?

  • Feb 4, 2011

Economic growth is re-accelerating, but that growth is coming at a cost…price pressures are building significantly. Manufacturing prices are up along with commodity prices.

 

Oct 05 2010

Beware The Economic Ticker Tape

  • Oct 5, 2010

It has become more and more difficult to filter out the short term economic noise. By focusing on this minutia, investors can easily lose sight of the big picture.

Jul 06 2010

Stocks And Economy Joined At The Hip… For Now

  • Jul 6, 2010

Economic indicators are hypersensitive to even small changes in the data, and investors are hypersensitive to the indicators themselves.

Mar 02 2010

First Year In The Books… And Still Bullish

  • Mar 2, 2010

Global bull market is now one year old. U.S. stocks are probably in fair value territory, but should move to moderately overvalued territory as both the economy and investor sentiment improve.

 

Nov 04 2009

Countering The Consensus Gloom

  • Nov 4, 2009

There’s an overwhelming consensus that the U.S. economy has slipped into a long-term phase of declining growth in real GDP and chronically higher unemployment. Here’s a dissenting opinion from a client, along with Steve Leuthold’s response.

Oct 05 2008

Financial Crises: A Historical Perspective

  • Oct 5, 2008

Doug Ramsey examines the history of bank failures and prior liquidity crises (back to 1830) to demonstrate that this current financial meltdown is not unprecedented. The names have changed, but the economic and emotional responses have been loosely patterned over the entire time frame.

 

Feb 05 2008

Do You Believe In "Decoupling"

  • Feb 5, 2008

A popular buzz word in recent months is “decoupling”, often used in building a case for investing in fast growing foreign stock markets even though the U.S. economy is entering a phase of minimal economic growth or recession.

Feb 05 2008

U.S. Economy Skirts Recession In Q4, Or Does It?

  • Feb 5, 2008

It now appears that the downward bias in inflationary pressures suggested by the CPI data is tame compared to the GDP Deflator. And if this is true, investors may be operating under a false sense of security  that economic growth remains positive (albeit ever so slight).

Feb 05 2008

The Economy And The Stock Market

  • Feb 5, 2008

The stock market tends to peak out 6-12 months prior to recession but turns back up prior to the end of a recession.

 

Jan 05 2008

2008: Less Than Great

  • Jan 5, 2008

Yes, it is thermal pollution time again. It’s the new year when prognosticators and investment pundits produce large volumes of hot air, probably contributing to global warming.

Dec 05 2007

Bulls May Have Christmas...

  • Dec 5, 2007

Bulls may indeed have Christmas, but fundamentals for bearish case in 2008 are extensive.

Dec 05 2007

Is Mild Stagflation In The Cards?...How To Play It

  • Dec 5, 2007

It is very possible that the early part of 2008 will see a brief period of higher inflation combined with slowing real growth in the U.S. economy.

Dec 05 2007

Still On Target For +4% Or Higher CPI At Year End

  • Dec 5, 2007

We expect broad inflation measures to accelerate over the remainder of the year.

Dec 05 2007

2007 Outlook

  • Dec 5, 2007

CPI Accelerating In Q4, Economy Creeping Along, But Expect Recession In 2008

Nov 05 2007

2007 OUTLOOK: CPI Accelerating In Q4, Economy Creeping Along, But Expect Recession In 2008

  • Nov 5, 2007

Expect economy to slow the remainder of 2007 as a result of slower consumer and business spending, as well as housing and auto woes. A 2008 recession is now a stronger possibility. 

Oct 03 2007

View From The North Country

  • Oct 3, 2007

Not only is October ‘National Pork Month’ in the U.S., it is the “Year of the Pig” in China. This brings to mind the old stock market homily “A Bull can make money and a Bear can make money, but Pigs are losers.”

Jul 04 2007

View From The North Country

  • Jul 4, 2007

2007 half time report. Revisiting our original 2007 projections with some current modifications. Outlook for stock market, interest rates, inflation, profits, economy, the deficits, the U.S. dollar and gold.

 

Jul 04 2007

2008 Recession Watch

  • Jul 4, 2007

What little discussion of a possible U.S. recession there had been in the first half of the year has dried up with an apparent pick up in the economy. “Inside The Stock Market” this month presents a 2008 Recession Watch, identifying some indicators which may prove useful in assessing the possibly of a coming recession.

Jun 05 2007

2007 OUTLOOK: CPI Accelerating In Q4, Economy Creeping Along, But Expect Recession In 2008

  • Jun 5, 2007

Expect economic expansion to pick up a bit after weak first quarter, but a 2008 recession is a possibility. 

May 05 2007

Bond Investors: Forget Your Econ 101!!

  • May 5, 2007

We know we’re not the only ones to have noticed, but the old economic rules of thumb haven’t been working in the U.S. bond market for some time.