The S&P 500 Cap-Weighted Index ((IVV)) has had an scorching start to the year, breaking the 1600 level and in the process surpassing its all-time highs set in 2007 in this past week. Since correcting in the middle of April, the index bounced off support at the 50-day moving average in emphatic fashion, finally clearing resistance at 1597 with news [...]
The GSCI Commodity Index ((GSG)) consists primarily of Energy (71%), but also contains Agriculture (14%), Industrial Metals (7%), Livestock (4%), and Precious Metals (4%). After breaking out to the upside in January, the index quickly reversed course and broke both moving averages on its way down. The index has been mired in a ugly downtrend since early February, due to a strengthening [...]
Here is a list of things that concern us. Fed incentivized risk seeking A recent surge in risk asset prices Continued global rebalancing Continued global deleveraging Bail-ins as much or more than bail-outs Continued excess leverage in the banking sector Technical indicators rolling over and flashing orange Tired fiscal houses Tired fundamentals Experimental Monetary Policy We continue to believe, given [...]
The US stock market was one bereft of sellers, before a general market sell-off this past week. In mid-November, the S&P 500 ((IVV)) had just finished breaking its 200-day moving average on its way to a multi-year low at the 1343 level. Since then, the index has been on a tear, gaining over 18% in a little over 4 months. [...]
This "recovery" is in its 4th year. Unfortunately, we have yet to see robust growth in employment or incomes. The recovery continues to be about low interest rates and abundant liquidity. Cheap debt capital benefits equity owners. Whether real or nominal, as revenues grow and the cost of capital becomes cheaper, the benefits flow to equity owners. Companies are not [...]
The Standard & Poor’s 500 is a stock market index based on the common stock prices of the biggest 500 publicly traded American companies. The S&P 500 ((IVV)) successfully bounced off its 50-day moving average on its way to new highs , the third such incident in 2013. Apparently there's no stopping the stock markets. The index is up 12.02% [...]
The S&P 500 Cap-Weighted Index ((IVV)) has had an scorching start to the year, surpassing its all-time highs set in 2007. While the index had a rough last week, it did bounce off support at the 50-day moving average on Friday in emphatic fashion, coming close to closing higher for the day. It seems likely that the index will continue [...]
The great thing about leverage is that, while it works, it is very profitable and it feels really good. The bad thing about leverage is that, when it doesn't work, it can bankrupt you quickly and it feels very bad. This boom/bust scenario manifested itself in the housing market. I'm fairly convinced that, given the monetary environment, this same equation [...]
The GSCI Commodity Index ((GSG)) consists primarily of Energy (71%), but also contains Agriculture (14%), Industrial Metals (7%), Livestock (4%), and Precious Metals (4%). After breaking out January, the index staggered before finally giving way this past month, due to a strengthening US Dollar. The index broke through both moving averages on its way down, testing support at the 32.25 [...]
The 21st century, global, economic saga continues to provide plenty of nuance. The past few weeks, we've been introduced to a few new characters, Cyprus and Russia. There is a bit of a rogue element with Russia. Regardless, the same common themes are present for analysis: leverage, speculation, global capital imbalances and the accompanying political, fiscal, and monetary responses. Cyprus [...]
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