The GSCI Commodity Index ((GSG)) consists primarily of Energy (71%), but also contains Agriculture (14%), Industrial Metals (7%), Livestock (4%), and Precious Metals (4%). The index fell below the 200-day moving average, falling to the 32.30 support level. With the dollar likely to strengthen further, and the index slightly below support, look for the index to breakthrough to the downside, [...]
Guest post from friend of Alhambra, Brian Cronin: The problem with entitlements is that once they are in place, they are extremely difficult to amend or even take away. Many seniors in the US for example, once intitially fearful of the Medicare Part D drug plan, have come to accept it and enjoy its economies of scale. It was put [...]
The Euro crisis and worsening economic statistics back home have knocked the wind out of the sails for the US stock market. It’s been quite a bull run since the November lows, but now the S&P 500 has corrected and finds itself under its 50-day moving average and its short-term uptrend line. The index made a lower high at 1415 [...]
I’m sure many of you have recently read about the risk of bonds or that bonds are the next bubble. Should we consider bonds a safe place to invest, to earn income or to diversify the risk present in today’s world? The current environment is definitely challenging. The Fed, in its attempt to charge the economy, is nearing the end [...]
Currency Exchange Rates The US Dollar is trending lower, as the Fed's policy to keep interest rates low for the foreseeable future is continuing to wreck havoc on the dollar. The dollar may be worse if it were not for the monetary easing going on throughout the world. We seem to be the "tallest midget" in the FX markets. The [...]
Economies travel in cycles. Some factors contributing to economic cycles are the following: Periods of great innovation and capital formation Fluctuations in fiscal policies Credit/Money creation War, disease, natural disaster At Alhambra, we often refer to Keynesian theory v Classical theory in reference to responses to the cyclical nature of an economy. The reality, economies inevitably have hiccups. In lay [...]
The S&P 500 cap-weighted index is at a crossroads right now. The index currently sits atop its 50-day Moving Average, with momentum pointing slightly bearish after Friday's close at the lows of the session. The index has returned 12.61% so far this year. The S&P 500 equal-weighted index ((RSP)) is set up so that every stock in the index has [...]
The GSCI Commodity Index ((GSG)) consists primarily of Energy (71%), but also contains Agriculture (14%), Industrial Metals (7%), Livestock (4%), and Precious Metals (4%). The index fell below the 50-day moving average, falling to the 34.40 support level. With the dollar likely to strengthen further, contingent on the government not pursuing another round of quantitative easing, look for the index [...]
There is definitely a higher cost of living in certain areas of the United States. This can be because an area is geographically desirable, the beauty and climate of the California coast or the cosmopolitan setting of Manhattan; it can be because an area is economically desirable, Silicon Valley or Cambridge, MA. Everyone has their own marginal utility function. How [...]
We continue to hold to the thesis that we reside in a cyclical bull market in the context of a secular bear market. The cycle seems to be concentrated in discretionary items like automobiles and ipads. An aging fleet of cars needs to be replaced. The average age of a car in the US is 11 years old. Short term [...]
Stay In Touch