How important President Donald Trump's speech before a joint assembly on congress Tuesday night was is not easy to gauge, but, from a Wall Street perspective, he must have hit the high notes perfectly because all major averages were straight up at the opening bell and continued to add to gains throughout Wednesday's session.
The Dow, which blew away the 20,000 Rubicon less than a month ago, added nearly 1.5%, or 303 points, its largest one-day gain since early December. With Industrials leading the way, the other three major averages broke out as well, with the S&P pretty much reaching highs that analysts had been predicting as end-of-year results, yet we're barely two months into the new year.
How this kind of euphoria will eventually manifest itself is still a mystery, especially with stocks tacking higher despite consistent warnings of a valuation trap being set. While stocks continue to ramp on a daily basis, corporate reports are not following the same tune. Additionally, analysts from various houses also revised first quarter GDP estimates lower, with Goldman Sachs and the Atlanta Fed looking for 1.8% growth. JP Morgan and Bank of America are even more pessimistic, at 1.5% and 1.3%, respectively.
In the main, what companies behind the stocks are counting on is a relaxed regulatory environment under President Trump's administration. The President has already issued a variety of pro-business executive orders and his commitment to repealing and replacing the Affordable Care Act (Obamacare) is also being viewed as a positive on two fronts. First, it will free up consumer funds from an expensive mandated coverage nightmare; second, companies will probably get breaks as well in group coverage.
Adding to the speculative high spirits are items currently under the radar such as the President's budget, which includes massive cost-cutting across agencies, a one trillion dollar infrastruture plan that Mr. Trump touched on it in his speech, and trade negotiations with countries outside the framework of international treaties such as NAFTA, TPP and the World Bank.
All told, President Trump's first six weeks in office have been nothing short of miraculous for stocks, though it will take some time to see how it all plays out. Either stock pickers have been set up for a major catastrophe or the enthusiasm and honesty of the new president will indeed guide America and American business interests to new heights.
Lurking in the shadows behind the presidential bluster is the Federal Reserve, which meets in two weeks to decide whether to raise federal funds rates or keep them at current levels. Money is on them keeping the rates at the current 0.50-0.75, though even an increase of 25 basis points would seem to be inadequate to quiet Wall Street's enthusiasm.
At the Close, 3.1.17:
Dow: 21,115.55 +303.31 (1.46%)
NASDAQ: 5,904.03 +78.59 (1.35%)
S&P 500: 2,395.96, +32.32 (1.37%)
NYSE Composite: 11,661.22, +148.83 (1.29%)
Thursday, March 2, 2017
Wednesday, March 1, 2017
Dow Winning Streak Ends At 12, Should Resume Promptly
Stocks ended a historic run of 12 straight winning sessions on the Dow Jones Industrial Average, tying the mark set in January of 1987, finishing the month of February on a dour note, though overall, stocks were fantastic for the month and so far in 2017.
With a possible March rate hike still two weeks away, there's still plenty of time to jump upon the Wall Street bandwagon. Since stocks apparently have no downside, more money will be pumped into the market by the almighty algos, probably beginning on March 1.
The old adage, "don't fight the tape," is in play as fundamentals have been tossed to the curb in favor of momentum-chasing. Stocks should continue to climb until they don't.
At The Close, 2.28.17:
Dow: 20,812.24, -25.20 (-0.12%)
NASDAQ: 5,825.44, -36.46 (-0.62%)
S&P 500: 2,363.64, -6.11 (-0.26%)
NYSE Composite: 11,512.39, -45.96 (-0.40%)
With a possible March rate hike still two weeks away, there's still plenty of time to jump upon the Wall Street bandwagon. Since stocks apparently have no downside, more money will be pumped into the market by the almighty algos, probably beginning on March 1.
The old adage, "don't fight the tape," is in play as fundamentals have been tossed to the curb in favor of momentum-chasing. Stocks should continue to climb until they don't.
At The Close, 2.28.17:
Dow: 20,812.24, -25.20 (-0.12%)
NASDAQ: 5,825.44, -36.46 (-0.62%)
S&P 500: 2,363.64, -6.11 (-0.26%)
NYSE Composite: 11,512.39, -45.96 (-0.40%)
Tuesday, February 28, 2017
Coincidence Or Conspiracy? The Art Cashin - Fearless Rick Echo Chamber
Not one to expectantly toot one's own horn, Money Daily continues to display some market sense, the latest iteration being the confluence of the weekly market recap post from Sunday, February 26, Dow At Record Highs 11 Staight Sessions; Eye On PPT, Central Bank Intervention dovetailing with legendary floor trader Art Cashin's commentary at King World News the same day.
In the nearly 15-minute audio, Cashin, Director of Floor Operations for UBS, touched (near the end of the broadcast) on the very same subject matter as Money Daily, namely, central bank intervention in markets.
Like Fearless Editor and Publisher, Rick Gagliano, Cashin - undeniably a more expert analyst than our own - sees intervention as unsettling to markets, comparing the intrusion to a rigged poker game, and sees danger in such action. As is the usual case, Mr. Cashin plows some new ground as well, coining the phrase "intellectual civil war" in describing the conditions in Northern vs. Southern Italy and touching upon other established, mostly European nations.
In defense of his moderate style, Cashin opines that his success has been largely based upon, quoting him,
Good stuff, indeed, and well worth a listen.
Keeping in mind central bank intervention, i.e., buying at all-time highs, the Dow made a new record close for the 12th straight session, that, in itself, should be cause for alarm... the one that never goes off at market tops (Old Wall Street saying: "they never ring the bell at the top").
The Dow has never closed higher for 13 straight sessions, the most recent run tying the mark set in January 1987, which, as market observers know well, was the precursor of one of the most devastating crashes in market history.
At the Close, 2.27.17:
Dow: 20,837.44, +15.68 (0.08%)
NASDAQ: 5,861.90, +16.59 (0.28%)
S&P 500: 2,369.75, +2.41 (0.10%)
NYSE Composite: 11,558.35, +17.06 (0.15%)
In the nearly 15-minute audio, Cashin, Director of Floor Operations for UBS, touched (near the end of the broadcast) on the very same subject matter as Money Daily, namely, central bank intervention in markets.
Like Fearless Editor and Publisher, Rick Gagliano, Cashin - undeniably a more expert analyst than our own - sees intervention as unsettling to markets, comparing the intrusion to a rigged poker game, and sees danger in such action. As is the usual case, Mr. Cashin plows some new ground as well, coining the phrase "intellectual civil war" in describing the conditions in Northern vs. Southern Italy and touching upon other established, mostly European nations.
In defense of his moderate style, Cashin opines that his success has been largely based upon, quoting him,
...because the first thing I do when I enter a room is look for the exit signs.
Good stuff, indeed, and well worth a listen.
Keeping in mind central bank intervention, i.e., buying at all-time highs, the Dow made a new record close for the 12th straight session, that, in itself, should be cause for alarm... the one that never goes off at market tops (Old Wall Street saying: "they never ring the bell at the top").
The Dow has never closed higher for 13 straight sessions, the most recent run tying the mark set in January 1987, which, as market observers know well, was the precursor of one of the most devastating crashes in market history.
At the Close, 2.27.17:
Dow: 20,837.44, +15.68 (0.08%)
NASDAQ: 5,861.90, +16.59 (0.28%)
S&P 500: 2,369.75, +2.41 (0.10%)
NYSE Composite: 11,558.35, +17.06 (0.15%)
Sunday, February 26, 2017
Dow At Record Highs 11 Staight Sessions; Eye On PPT, Central Bank Intervention
As has been the case for multiple sessions over many years, a rally in the final hour of trading pushed the Dow Jones Industrial Average to a new all-time high, with the NASDAQ and S&P averages also closing up, but short of record highs. They NYSE Composite was fractionally lower.
In the red the entire session, the Dow gained 70 points from 3:00 to 4:00 pm ET, with other major averages also gaining. This kind of activity has been a market feature since at least 2001, when the existence of the Plunge Protection Team (PPT) turned from urban myth to global reality. The PPT, created by Presidential Order #12631, signed on March 18, 1988 by President Ronald Reagan is also known as The Working Group on Financial Markets, is, in reality, a body of financial authorities consisting of:
Thus, tin-foil-hat type conspiracies have continued to suggest that the Federal Reserve and other central banks have been manipulating markets higher for years, and, while such coordinated action has yet to be unearthed by the mainstream media, sites such as ZeroHedge.com and other fringe outlets report that while the PPT may or may not be always active in markets, there's no doubt that central banks, notable, the European Central Bank (ECB), Swiss National Bank (SNB) and Bank of Japan (BOJ) are heavily invested in US and other global equities, making a mockery of the global regime of fiat money.
There are those who say intervention by government-sponsored agencies is not altogether nefarious, and some who believe such market-rigging is a good and reliable replacement for Adam Smith's "invisible hand" of the markets, it cannot be understated adequately that such activity will eventually undermine the integrity of financial markets and instruments.
Being based almost entirely upon faith and trust, financial markets have become the backbone of the global economy. If that faith and trust is broken - an unlikely occurrence, as the central banks, governments, and major brokerages work hand-in-hand largely toward the same end (higher stock prices) - the fragile system would crumble. An antecedent (and, much larger market) to the inner workings of financial markets is the bond market, which has also been pistol-whipped regularly by central bank policy and directive. On Friday, the US Treasury 10-Year Note fell to its lowest level in nearly three months, closing out the week at 2.3170, a direct result of higher stock prices, also known in the investing world as TINA (There Is No Alternative... to stocks).
With central banks and government agencies regularly interjecting themselves and their policies into financial markets, the natural question becomes: how stable and trustworthy are these markets and who gains from such manipulation?
Answering the question bluntly, the markets are only as stable as the institutions behind them, which is today a matter of considerable conjecture and discordant viewpoints. Purists posit that the mountains of debt produced by individuals, businesses, and governments is simply unsustainable and that a rout and crash, while unpredictable, is inevitable. The obvious conclusion to the other half of the question "qui bono" (who gains) is those in power and in control of such vast swaths of money, the governments, oligarchs, commercial and central banks. Beyond that, those in power consider themselves to be benefactors of the millions who gain from higher stock prices, inflation and boosts to massively underfunded pension funds.
With this degree of chutzpah in and on the minds of the central bankers and government leaders of the world, there is little doubt that they believe their actions to be highly beneficial to the orderly running of global finances while also not taking into account the falsity and pervasive inequities that are given rise by those same actions. Those with power over financial markets hold an incredible degree of responsibility, a responsibility that seemingly has gone beyond the pale, over the moon and into its own orbit.
Essentially, those who have questioned or taken positions contrary to the policies of the Fed and their brethren central banks, especially since the GFC of 2008, have been serially decimated in the markets. With stock indices raging without underlying fundamental bases, the planet may have reached a point of no return, wherein all matters financial are no longer in the control of individuals, but, rather, controlled by an opaque group of self-appointed masters.
One can only hope that they are well-grounded and essentially good-natured, because the alternatives would be brazen in concept and bizarre in execution.
At The Close, 2.24.17:
Dow: 20,821.76, +11.44 (0.05%)
NASDAQ: 5,845.31, +9.80 (0.17%)
S&P 500: 2,367.34, +3.53 (0.15%)
NYSE Composite: 11,541.29, -14.87 (-0.02%)
For the Week:
Dow: +197.71 (0.96%)
NASDAQ: +6.73 (0.12%)
S&P 500: +16.18 (0.69%)
NYSE Composite: +30.38 (0.26)
In the red the entire session, the Dow gained 70 points from 3:00 to 4:00 pm ET, with other major averages also gaining. This kind of activity has been a market feature since at least 2001, when the existence of the Plunge Protection Team (PPT) turned from urban myth to global reality. The PPT, created by Presidential Order #12631, signed on March 18, 1988 by President Ronald Reagan is also known as The Working Group on Financial Markets, is, in reality, a body of financial authorities consisting of:
- The Secretary of the Treasury, or his or her designee (as Chairperson of the Working Group);
- The Chairperson of the Board of Governors of the Federal Reserve System, or his or her designee;
- The Chairperson of the Securities and Exchange Commission, or his or her designee; and
- The Chairperson of the Commodity Futures Trading Commission
Thus, tin-foil-hat type conspiracies have continued to suggest that the Federal Reserve and other central banks have been manipulating markets higher for years, and, while such coordinated action has yet to be unearthed by the mainstream media, sites such as ZeroHedge.com and other fringe outlets report that while the PPT may or may not be always active in markets, there's no doubt that central banks, notable, the European Central Bank (ECB), Swiss National Bank (SNB) and Bank of Japan (BOJ) are heavily invested in US and other global equities, making a mockery of the global regime of fiat money.
There are those who say intervention by government-sponsored agencies is not altogether nefarious, and some who believe such market-rigging is a good and reliable replacement for Adam Smith's "invisible hand" of the markets, it cannot be understated adequately that such activity will eventually undermine the integrity of financial markets and instruments.
Being based almost entirely upon faith and trust, financial markets have become the backbone of the global economy. If that faith and trust is broken - an unlikely occurrence, as the central banks, governments, and major brokerages work hand-in-hand largely toward the same end (higher stock prices) - the fragile system would crumble. An antecedent (and, much larger market) to the inner workings of financial markets is the bond market, which has also been pistol-whipped regularly by central bank policy and directive. On Friday, the US Treasury 10-Year Note fell to its lowest level in nearly three months, closing out the week at 2.3170, a direct result of higher stock prices, also known in the investing world as TINA (There Is No Alternative... to stocks).
With central banks and government agencies regularly interjecting themselves and their policies into financial markets, the natural question becomes: how stable and trustworthy are these markets and who gains from such manipulation?
Answering the question bluntly, the markets are only as stable as the institutions behind them, which is today a matter of considerable conjecture and discordant viewpoints. Purists posit that the mountains of debt produced by individuals, businesses, and governments is simply unsustainable and that a rout and crash, while unpredictable, is inevitable. The obvious conclusion to the other half of the question "qui bono" (who gains) is those in power and in control of such vast swaths of money, the governments, oligarchs, commercial and central banks. Beyond that, those in power consider themselves to be benefactors of the millions who gain from higher stock prices, inflation and boosts to massively underfunded pension funds.
With this degree of chutzpah in and on the minds of the central bankers and government leaders of the world, there is little doubt that they believe their actions to be highly beneficial to the orderly running of global finances while also not taking into account the falsity and pervasive inequities that are given rise by those same actions. Those with power over financial markets hold an incredible degree of responsibility, a responsibility that seemingly has gone beyond the pale, over the moon and into its own orbit.
Essentially, those who have questioned or taken positions contrary to the policies of the Fed and their brethren central banks, especially since the GFC of 2008, have been serially decimated in the markets. With stock indices raging without underlying fundamental bases, the planet may have reached a point of no return, wherein all matters financial are no longer in the control of individuals, but, rather, controlled by an opaque group of self-appointed masters.
One can only hope that they are well-grounded and essentially good-natured, because the alternatives would be brazen in concept and bizarre in execution.
At The Close, 2.24.17:
Dow: 20,821.76, +11.44 (0.05%)
NASDAQ: 5,845.31, +9.80 (0.17%)
S&P 500: 2,367.34, +3.53 (0.15%)
NYSE Composite: 11,541.29, -14.87 (-0.02%)
For the Week:
Dow: +197.71 (0.96%)
NASDAQ: +6.73 (0.12%)
S&P 500: +16.18 (0.69%)
NYSE Composite: +30.38 (0.26)
Wednesday, February 22, 2017
Fed Minutes Put March Rate Hike In Play
Editor's Note: With the luck of some extremely mild weather in Upstate New York (temps in the 60s today and expected the same for Thursday and Friday), the Money Daily team (Fearless Rick) has headed out to open up spring and summer camp a little early. That means the usual posting of Money Daily will not be the normal after the market close summary, but will be more sporadic for probably the next three to four weeks and may not be "daily" at all. Better weather brings on more responsibilities and a relaxed time frame.
Thanks,
Fearless Rick
Let's not beat around the bush. The Federal Reserve is intent on raising rates, which should surprise nobody, as the federal funds rate has been at or below one percent for the better part of 16 years.
Currently set at 0.50-0.75%, the key overnight rate has been largely responsible for a great deal of irresponsibility, not the least of which was the subprime disaster of 2008 and the resultant Great Financial Crisis which sent the global economy into one of the worst tailspins since the Great Depression of 1929-1938.
So, with the release today of the minutes from last month's FOMC meeting, it's compelling to think that a rate increase would be on the agenda at the next meeting, mid-March.
After all, the latest hike, in December of last year, hardly caused a ripple at all. Most experienced investors and money managers are aware of the need to "normalize" policy by the Fed and have preparing for such an event (or series of hikes, which is completely probable) since December of 2015.
With President Trump promising a fiscal stimulus plan, the Fed's belief that inflation will be the end result is a bit of a cockeyed argument, but, as always, the hyper-politicized Federal Reserve Board of Governors will say anything to get to their desired result. If the hikes come too quickly - they promised four this year - they can lay the blame on everybody's favorite political punching bag, Mr. Trump. Should things work out, the Fed will claim all the credit for "saving the financial system as we know it."
Either way, the Fed will come out smelling like the proverbial rose, even though they come closer to the stench of burning paper currency than that of a pretty flower.
March is now a "live" month for the Fed, though it should not go unnoticed that the Fed has and will likely continue to do not what they say, as in the case of last year's promise of three rate hikes, when in fact they actually performed just one (December).
With the stock indices hitting all-time highs on just about a daily basis, March would be as good a time as any to get rates another notch closer to one percent. In fact, a 50 basis point hike, to 1.00-1.25% wouldn't be such a bad idea. The stock markets are about to go belly up, despite being wildly overvalued.
Wall Street suffers from the absolute worst form of normalcy bias and that alone should prevent even a correction. Financial markets are in as weird a place as they've ever been, but expect the next crashing sounds to come from overseas, either to the West, as in Japan (or even China), or looking East at the failed experiment that is the European Union and the coming parity of the euro to the US dollar.
Thanks,
Fearless Rick
Let's not beat around the bush. The Federal Reserve is intent on raising rates, which should surprise nobody, as the federal funds rate has been at or below one percent for the better part of 16 years.
Currently set at 0.50-0.75%, the key overnight rate has been largely responsible for a great deal of irresponsibility, not the least of which was the subprime disaster of 2008 and the resultant Great Financial Crisis which sent the global economy into one of the worst tailspins since the Great Depression of 1929-1938.
So, with the release today of the minutes from last month's FOMC meeting, it's compelling to think that a rate increase would be on the agenda at the next meeting, mid-March.
After all, the latest hike, in December of last year, hardly caused a ripple at all. Most experienced investors and money managers are aware of the need to "normalize" policy by the Fed and have preparing for such an event (or series of hikes, which is completely probable) since December of 2015.
With President Trump promising a fiscal stimulus plan, the Fed's belief that inflation will be the end result is a bit of a cockeyed argument, but, as always, the hyper-politicized Federal Reserve Board of Governors will say anything to get to their desired result. If the hikes come too quickly - they promised four this year - they can lay the blame on everybody's favorite political punching bag, Mr. Trump. Should things work out, the Fed will claim all the credit for "saving the financial system as we know it."
Either way, the Fed will come out smelling like the proverbial rose, even though they come closer to the stench of burning paper currency than that of a pretty flower.
March is now a "live" month for the Fed, though it should not go unnoticed that the Fed has and will likely continue to do not what they say, as in the case of last year's promise of three rate hikes, when in fact they actually performed just one (December).
With the stock indices hitting all-time highs on just about a daily basis, March would be as good a time as any to get rates another notch closer to one percent. In fact, a 50 basis point hike, to 1.00-1.25% wouldn't be such a bad idea. The stock markets are about to go belly up, despite being wildly overvalued.
Wall Street suffers from the absolute worst form of normalcy bias and that alone should prevent even a correction. Financial markets are in as weird a place as they've ever been, but expect the next crashing sounds to come from overseas, either to the West, as in Japan (or even China), or looking East at the failed experiment that is the European Union and the coming parity of the euro to the US dollar.
Stocks Ramp To All-Time Highs Again
More record closes for all major US indices.
At The Close, 2/21/17:
Dow: 20,743.00, +118.95 (0.58%)
NASDAQ: 5,865.95, +27.37 (0.47%)
S&P 500: 2,365.38, +14.22 (0.60%)
NYSE Composite: 11,578.25, +67.34 (0.59%)
At The Close, 2/21/17:
Dow: 20,743.00, +118.95 (0.58%)
NASDAQ: 5,865.95, +27.37 (0.47%)
S&P 500: 2,365.38, +14.22 (0.60%)
NYSE Composite: 11,578.25, +67.34 (0.59%)
Friday, February 17, 2017
Big Week For Equities Sends All US Indices To All-Time Highs
Stocks suffered early in the day on Friday, but rallied late with the Dow, S&P 500, and NASDAQ all closing with marginal gains. Only the NYSE Composite ended the day in the red, down about a point-and-a-half.
Even with options expiry, Friday was barely exciting, but, for the week, the US averages were, in a word, incredible.
The closing figures for the day and week are presented below. More analysis (if any is even necessary) Saturday AM.
At the Close, Friday, February 17, 2017:
Dow: 20,624.05, +4.28 (0.02%)
NASDAQ: 5,838.58, +23.68 (0.41%)
S&P 500: 2,351.16, +3.94 (0.17%)
NYSE COMPOSITE: 11,502.71, -1.48 (-0.01%)
For the week:
Dow: +354.68 (1.75%)
NASDAQ: +104.45 (1.82%)
S&P 500: +35.06 (1.51%)
NYSE COMPOSITE: +133.19 (1.17%)
Even with options expiry, Friday was barely exciting, but, for the week, the US averages were, in a word, incredible.
The closing figures for the day and week are presented below. More analysis (if any is even necessary) Saturday AM.
At the Close, Friday, February 17, 2017:
Dow: 20,624.05, +4.28 (0.02%)
NASDAQ: 5,838.58, +23.68 (0.41%)
S&P 500: 2,351.16, +3.94 (0.17%)
NYSE COMPOSITE: 11,502.71, -1.48 (-0.01%)
For the week:
Dow: +354.68 (1.75%)
NASDAQ: +104.45 (1.82%)
S&P 500: +35.06 (1.51%)
NYSE COMPOSITE: +133.19 (1.17%)
Thursday, February 16, 2017
OMG! Only Dow Closes At New All-Time High
Stocks took a needed breather on Thursday, staring at a Friday options expiry tomorrow which should be a massive payday for the Bulls, which, we assume would be everybody.
Gosh, this is getting repetitive and boring.
At the Close 2.16.17:
Dow: 20,619.77, +7.91 (0.04%)
NASDAQ: 5,814.90, -4.54 (-0.08%)
S&P 500: 2,347.22, -2.03 (-0.09%)
NYSE Composite: 11,504.20, -10.20 (-0.09%)
Gosh, this is getting repetitive and boring.
At the Close 2.16.17:
Dow: 20,619.77, +7.91 (0.04%)
NASDAQ: 5,814.90, -4.54 (-0.08%)
S&P 500: 2,347.22, -2.03 (-0.09%)
NYSE Composite: 11,504.20, -10.20 (-0.09%)
Wednesday, February 15, 2017
Four Straight: All Major US Indices Close At Record Highs
Shades of the Weimar Republic, as all financial assets are becoming ridiculously overpriced.
As was the case in the Weimar, this may not end well. Inflation statistics from this morning's CPI reading showed January up 0.6% and the core CPI higher by some 0.3%. Meanwhile, capacity utilization fell 0.3 from December, to 75.3%.
Retail sales figures were also positive, showing a gain of 0.4%, after December's numbers were magically improved, revised from 0.6% to 1.0%. This as holiday sales gains from major retailers were modest or unreported, and large chains such as Sears and Macy's announced mass store closings coming throughout the year.
Global stock indices have also been ramping higher of late, an indication that the inflation, so often promised by endless rounds of quantitative easing (money printing) and an extended period (8 to 15 years) of low interest rates (some below zero) is finally occurring. What the globalists have been touting and predicting to happen can only lead to one logical conclusion: higher prices for consumers, a condition that will prove to impoverish the average citizenry of nearly every country in the world.
All of this may have something to do with the globalists running scared that their era of "free trade" and fiat money is about to meet its logical conclusion.
But it's all good for Wall Street, and that's what counts, to Wall Street.
At the Close, 2/15/17:
Dow: 20,618.98, +114.57 (0.56%)
NASDAQ: 5,821.62, +39.05 (0.68%)
S&P 500: 2,351.15, +13.57 (0.58%)
NYSE Composite: 11,510.34, +41.47 (0.36%)
As was the case in the Weimar, this may not end well. Inflation statistics from this morning's CPI reading showed January up 0.6% and the core CPI higher by some 0.3%. Meanwhile, capacity utilization fell 0.3 from December, to 75.3%.
Retail sales figures were also positive, showing a gain of 0.4%, after December's numbers were magically improved, revised from 0.6% to 1.0%. This as holiday sales gains from major retailers were modest or unreported, and large chains such as Sears and Macy's announced mass store closings coming throughout the year.
Global stock indices have also been ramping higher of late, an indication that the inflation, so often promised by endless rounds of quantitative easing (money printing) and an extended period (8 to 15 years) of low interest rates (some below zero) is finally occurring. What the globalists have been touting and predicting to happen can only lead to one logical conclusion: higher prices for consumers, a condition that will prove to impoverish the average citizenry of nearly every country in the world.
All of this may have something to do with the globalists running scared that their era of "free trade" and fiat money is about to meet its logical conclusion.
But it's all good for Wall Street, and that's what counts, to Wall Street.
At the Close, 2/15/17:
Dow: 20,618.98, +114.57 (0.56%)
NASDAQ: 5,821.62, +39.05 (0.68%)
S&P 500: 2,351.15, +13.57 (0.58%)
NYSE Composite: 11,510.34, +41.47 (0.36%)
Tuesday, February 14, 2017
NYSE, Dow, S&P 500, NASDAQ Close At All-Time Highs 3rd Straight Session
As the bubble grows what can be said of the current political and economic conditions except that we are in uncharted territory?
Just a week or so ago, many were still wondering if the Dow could reach and hold 20,000. 500 points later, on some of the weakest volume in stock market history, we have an answer, as troubling as it may seem.
With the politicians tied up with what increasingly appears to abe an overt attempt to oust recently-installed President Donald J. Trump, the markets do not seem to care one whit whether the myriad problems of the United States and the world are solver, much less addressed.
For now, the world watches as Washington, DC self-destructs. Stocks continue to soar. This could go on for an extended period, but the system is strained if not outright rigged for massive Wall Street gains during one of the most turbulent periods in the country's history.
It could all come crashing down tomorrow, though that scenario is equally improbable, if not downright frightening.
For the most part, the market is being plied by professionals more than ever before, a condition that obtains from a variety of sources, one of them a well-seated distrust of the financial markets by individuals, the other, unbridled greed.
There may be opportunities, but one would be hard-pressed to delineate any of them with stocks ramping higher day after day after day.
The overarching theme of markets over time has been to buy low, sell high, and stay in the game. Obviously, this is not a game everyone wishes to be playing.
At the Close, Tuesday, February 13, 2017:
Dow: 20,504.41, +92.25 (0.45%)
NASDAQ: 5,782.57, +18.62 (0.32%)
S&P 500: 2,337.58, +9.33 (0.40%)
NYSE Composite: 11,468.88, +34.94 (0.31%)
Just a week or so ago, many were still wondering if the Dow could reach and hold 20,000. 500 points later, on some of the weakest volume in stock market history, we have an answer, as troubling as it may seem.
With the politicians tied up with what increasingly appears to abe an overt attempt to oust recently-installed President Donald J. Trump, the markets do not seem to care one whit whether the myriad problems of the United States and the world are solver, much less addressed.
For now, the world watches as Washington, DC self-destructs. Stocks continue to soar. This could go on for an extended period, but the system is strained if not outright rigged for massive Wall Street gains during one of the most turbulent periods in the country's history.
It could all come crashing down tomorrow, though that scenario is equally improbable, if not downright frightening.
For the most part, the market is being plied by professionals more than ever before, a condition that obtains from a variety of sources, one of them a well-seated distrust of the financial markets by individuals, the other, unbridled greed.
There may be opportunities, but one would be hard-pressed to delineate any of them with stocks ramping higher day after day after day.
The overarching theme of markets over time has been to buy low, sell high, and stay in the game. Obviously, this is not a game everyone wishes to be playing.
At the Close, Tuesday, February 13, 2017:
Dow: 20,504.41, +92.25 (0.45%)
NASDAQ: 5,782.57, +18.62 (0.32%)
S&P 500: 2,337.58, +9.33 (0.40%)
NYSE Composite: 11,468.88, +34.94 (0.31%)
Monday, February 13, 2017
All US Indices Close At Record Highs For Second Straight Session
No commentary needed.
At the Close, Monday, February 13, 2017:
Dow: 20,412.16, +142.79 (0.70%)
NASDAQ: 5,763.96, +29.83 (0.52%)
S&P 500: 2,328.25, +12.15 (0.52%)
NYSE Composite: 11,433.90, +56.17 (0.49%)
At the Close, Monday, February 13, 2017:
Dow: 20,412.16, +142.79 (0.70%)
NASDAQ: 5,763.96, +29.83 (0.52%)
S&P 500: 2,328.25, +12.15 (0.52%)
NYSE Composite: 11,433.90, +56.17 (0.49%)
Friday, February 10, 2017
Bubble Superfecta: Dow, NASDAQ, S&P 500, NYSE Composite All Close At New Records
As the week comes to a stunning close, it's official, every market in America is officially in deep into bubble territory.
Consider that the major indices all closed at all-time highs today and that the Dow Jones Industrial Average is up a whopping 2200 points since election day, November 8, 2016. That amounts to a gain of just over 12% in three months. At that rate of ascent, 22,000 on the Dow should be a no-brainer by the end of 2017.
Nothing other than stupidity, other people's money, greed, and momentum were needed to foment one of the most rapid rises in the history of the Dow. The other indices have surely been along for the ride; even the broad measure of the entire NYSE Composite cracked to a record close today.
Not to suggest that a reversal is imminent (been that way for 6 years at least), but for some perspective, let's examine where these markets were at the depths of the Great Financial Crisis (GFC), on March 9, 2009.
Dow: 6,547.05
NASDAQ: 1,268.64
S&P 500: 676.53
NYSE Composite: 4,226.31
In the span of eight years, during what has ostensibly been the weakest recovery after a recession since the Great Depression, the Dow and S&P have more than tripled, the NASDAQ has more than quadrupled, and the poor old NYSE Comp. is just short of tripling.
So, if you missed it you missed it, but there still may be time to get in. Nobody knows where this is going to end, but we can all thank Ben Bernanke and Janet Yellen for oodles of free cash injections worldwide (QE), zero interest rate policy (ZIRP) and the most reckless economic policies the world has ever witnessed.
It's still ongoing, though. The ECB and BOJ are still pumping money into their markets, and, unless you missed it, none other than the Swiss National Bank holds more than $64 billion in US equities.
Who said these central bankers don't know what they're doing?
Enjoy the weekend!
At the Close, Friday, February 10, 2017:
Dow: 20,269.37, +96.97 (0.48%)
NASDAQ: 5,734.13, +18.95 (0.33%)
S&P 500: 2,316.10, +8.23 (0.36%)
NYSE Composite: 11,377.72, +50.04 (0.44%)
For the Week:
Dow: +197.91 (0.99%)
NASDAQ: +67.36 (1.19%)
S&P 500: +18.68 (0.81%)
NYSE Composite: +50.04 (0.44%)
Consider that the major indices all closed at all-time highs today and that the Dow Jones Industrial Average is up a whopping 2200 points since election day, November 8, 2016. That amounts to a gain of just over 12% in three months. At that rate of ascent, 22,000 on the Dow should be a no-brainer by the end of 2017.
Nothing other than stupidity, other people's money, greed, and momentum were needed to foment one of the most rapid rises in the history of the Dow. The other indices have surely been along for the ride; even the broad measure of the entire NYSE Composite cracked to a record close today.
Not to suggest that a reversal is imminent (been that way for 6 years at least), but for some perspective, let's examine where these markets were at the depths of the Great Financial Crisis (GFC), on March 9, 2009.
Dow: 6,547.05
NASDAQ: 1,268.64
S&P 500: 676.53
NYSE Composite: 4,226.31
In the span of eight years, during what has ostensibly been the weakest recovery after a recession since the Great Depression, the Dow and S&P have more than tripled, the NASDAQ has more than quadrupled, and the poor old NYSE Comp. is just short of tripling.
So, if you missed it you missed it, but there still may be time to get in. Nobody knows where this is going to end, but we can all thank Ben Bernanke and Janet Yellen for oodles of free cash injections worldwide (QE), zero interest rate policy (ZIRP) and the most reckless economic policies the world has ever witnessed.
It's still ongoing, though. The ECB and BOJ are still pumping money into their markets, and, unless you missed it, none other than the Swiss National Bank holds more than $64 billion in US equities.
Who said these central bankers don't know what they're doing?
Enjoy the weekend!
At the Close, Friday, February 10, 2017:
Dow: 20,269.37, +96.97 (0.48%)
NASDAQ: 5,734.13, +18.95 (0.33%)
S&P 500: 2,316.10, +8.23 (0.36%)
NYSE Composite: 11,377.72, +50.04 (0.44%)
For the Week:
Dow: +197.91 (0.99%)
NASDAQ: +67.36 (1.19%)
S&P 500: +18.68 (0.81%)
NYSE Composite: +50.04 (0.44%)
Thursday, February 9, 2017
Bubble Trifecta! Dow, S&P, NASDAQ Close At All Time Highs
Was there any justification to today's push to new all time highs on the Dow, S&P, and NASDAQ (the NYSE Comp. fell just short of the previous closing high, 11,339.05, January 25)?
Probably not, because, as has been suggested by many in the know, this is a bubble, and bobbles don't need rational thought, fundamental investment concepts or sound judgement. All they need is momentum and most of that is supplied by robotic, HFT-fueled algorithms.
That's all one needs to know about whether it would be wise to buy into this market.
The most basic concept in investing is to buy low and sell high, not the converse of that simple dictum. Stocks are tremendously overvalued and today, they became even more so.
Tread into this casino with extreme caution. While gains may still be available to many, losses, which could come from any variety of sources, could be decisive. Trying to time this is a fool's errand, one that should not be undertaken if risk aversion is guiding.
At the Close, Thursday, February 9, 2017:
Dow: 20,172.40, +118.06 (0.59%)
NASDAQ: 5,715.18, +32.73 (0.58%)
S&P 500: 2,307.87, +13.20 (0.58%)
NYSE Composite: 11,327.68, +75.88 (0.67%)
Probably not, because, as has been suggested by many in the know, this is a bubble, and bobbles don't need rational thought, fundamental investment concepts or sound judgement. All they need is momentum and most of that is supplied by robotic, HFT-fueled algorithms.
That's all one needs to know about whether it would be wise to buy into this market.
The most basic concept in investing is to buy low and sell high, not the converse of that simple dictum. Stocks are tremendously overvalued and today, they became even more so.
Tread into this casino with extreme caution. While gains may still be available to many, losses, which could come from any variety of sources, could be decisive. Trying to time this is a fool's errand, one that should not be undertaken if risk aversion is guiding.
At the Close, Thursday, February 9, 2017:
Dow: 20,172.40, +118.06 (0.59%)
NASDAQ: 5,715.18, +32.73 (0.58%)
S&P 500: 2,307.87, +13.20 (0.58%)
NYSE Composite: 11,327.68, +75.88 (0.67%)
Wednesday, February 8, 2017
Midweek Doldrums: Dow Lower; NAZ, SPX, NYSE Comp Flat; Oil Still In Glut
With no major economic data released, Wednesday was a bit of a nothing-burger on the day. The Dow lost some ground while the other indices finished modestly to the upside.
There was more interest in the 10-year note, as the Treasury auctioned off $23 billion on what was deemed a very weak sale at a yield 2.333%.
Also making some headlines was WTI crude oil, which fell below $52 per barrel, after the American Petroleum Institute (API) said crude inventories rose by 14.2 million barrels, the second largest weekly build in the series.
The dull session comes as Q4 2016 earnings are winding down, and there hasn't been much in the way of good news from the corporate sector. Conversely, not many companies have been lowering forecasts, leaving investors in an area of suspense about which direction the market may go next.
At The Close, Tuesday, February 8, 2017:
Dow: 20,054.34, -35.95 (-0.18%)
NASDAQ: 5,682.45, +8.24 (0.15%)
S&P 500: 2,294.67, +1.59 (0.07%)
NYSE Composite: 11,252.31, +8.93 (0.08%)
There was more interest in the 10-year note, as the Treasury auctioned off $23 billion on what was deemed a very weak sale at a yield 2.333%.
Also making some headlines was WTI crude oil, which fell below $52 per barrel, after the American Petroleum Institute (API) said crude inventories rose by 14.2 million barrels, the second largest weekly build in the series.
The dull session comes as Q4 2016 earnings are winding down, and there hasn't been much in the way of good news from the corporate sector. Conversely, not many companies have been lowering forecasts, leaving investors in an area of suspense about which direction the market may go next.
At The Close, Tuesday, February 8, 2017:
Dow: 20,054.34, -35.95 (-0.18%)
NASDAQ: 5,682.45, +8.24 (0.15%)
S&P 500: 2,294.67, +1.59 (0.07%)
NYSE Composite: 11,252.31, +8.93 (0.08%)
Tuesday, February 7, 2017
Debt Notes: Inflation Over The Next 18 Months Is Very Doubtful, Unless...
There's been plenty of chit-chat the past few weeks about how President Trump's infrastructure initiative (we haven't had even a sniff of what this might be, besides the Mexican wall) and tax cuts are going to spur inflation, but there hasn't been any solid data upon which to rest the thesis.
Notwithstanding the minor upticks in CPI and PPI, there's little evidence to suggest that any kind of rampant inflation is on the immediate or even the future horizon, and there are plenty of good reasons for that.
Industry and international trade has been slow since the Great Recession of 2008-09 and our bouncy "recovery" hasn't made any real dent in the actual number of hours worked nationally. Sure, the BLS always tells us more and more jobs are being created and the unemployment figure is near historic lows, but they always fail to point out that people who have dropped out of the labor force aren't counted any more, so those figures are worth about what we all pay to read them... essentially, ummmm, nothing.
Now there is going to be inflation in some things, like it or not, and those things today are, in no particular order, health care, housing, autos, and higher education. Food prices in the USA are, and always have been, relatively stable. Notably, beef prices are far lower than they were just a few years ago.
From all indications, retailers closing up shops nationwide seems to be saying there isn't much demand for clothing. Household goods, ditto. So, where's the inflation coming from if demand is waning?
Simple answer. It's not. The Federal Reserve needs to run the narrative that inflation is upon us so they can jack up their abysmally-low federal funds rate. That's because their experiment in quantitative easing (printing money) and ZIRP (Zero Interest Rate Policy) have proven to be dismal failures. Of course, they will never admit to that, or to the fact that roughly $14 trillion has been wasted or funneled directly or indirectly to the top 1% wealthiest people.
Bottom line is that without demand for goods and services, there can be no price inflation, because, using the standard metric of inflation being more money chasing fewer goods, while there's certainly more money out there, there's also no shortage of goods and services. In fact, were the economy not in such a dreadful state, more people would be opening new businesses, simply because there would be money to be made and not much in the way of competition.
As it stands today, most of the needs of the average, below average, and above average US citizen are pretty easily met. Food and clothing are cheap, and that's two of the three essentials for survival. The third, housing, is largely dictated by geography, so, in big cities, it's expensive. Out in the boonies, not so much.
All of this brings us to the real question, where is all the money coming from?
Another simple answer: debt, though it's not exactly as cut-and-dried as many would believe. Outstanding credit card debt continues to rise, but it's just a shade below $1 trillion, and, as for home equity loans, many people, and many bankers, learned a lifetime lesson in the Global Financial Crisis (GFC). Where the real money is coming from is debt related to car loans and higher education, aka, student loans, both of which reached all-time highs in the 4th quarter of last year.
Strange as it may seem, both are at higher nominal levels than credit card debt, at $1.407 trillion for car loans and $1.11 trillion in student loans. It seems odd that there would be more in just these two categories than everything that could be purchased with credit cards, which is, actually, everything. You can even pay taxes or register your car with a credit card, so it's readily apparent that there's an oversized appetite for new cars and degrees from colleges.
It doesn't really make sense. The vehicles on the road today may be the latest with all the greatest gadgets and widgets, but they're not much better than cars made in the past fifteen years, many of which are still reliably on the road. as for a college education, that has to be a societal miscalculation, because a degree in liberal anti-establishment cultural studies or whatever isn't going to pay for itself any time soon. It's a conundrum, a mismatch, a MALINVESTMENT, of which there are many, everywhere.
That's not to mention that the median cost of a new home is at another all-time high, but, as mentioned earlier, that's largely a local issue, but it bears notice that the average monthly payment of principle and interest (PI) for that median home is over $1000 a month.
So, if you find yourself all bollixed up over high credit card balances with high interest rates, don't worry. There are plenty of college graduates living in nice, new homes driving new cars who are in much worse shape than you.
If you're one of those people, we're all sorry, and we're having a drink to your ultimate demise, telling the bartender, "charge it."
At The Close, Tuesday, February 7, 2017:
Dow: 20,090.29, +37.87 (0.19%)
NASDAQ: 5,674.22, +10.66 (0.19%)
S&P 500: 2,293.08, +0.52 (0.02%)
NYSE Composite: 11,236.17, -27.94 (-0.25%)
Notwithstanding the minor upticks in CPI and PPI, there's little evidence to suggest that any kind of rampant inflation is on the immediate or even the future horizon, and there are plenty of good reasons for that.
Industry and international trade has been slow since the Great Recession of 2008-09 and our bouncy "recovery" hasn't made any real dent in the actual number of hours worked nationally. Sure, the BLS always tells us more and more jobs are being created and the unemployment figure is near historic lows, but they always fail to point out that people who have dropped out of the labor force aren't counted any more, so those figures are worth about what we all pay to read them... essentially, ummmm, nothing.
Now there is going to be inflation in some things, like it or not, and those things today are, in no particular order, health care, housing, autos, and higher education. Food prices in the USA are, and always have been, relatively stable. Notably, beef prices are far lower than they were just a few years ago.
From all indications, retailers closing up shops nationwide seems to be saying there isn't much demand for clothing. Household goods, ditto. So, where's the inflation coming from if demand is waning?
Simple answer. It's not. The Federal Reserve needs to run the narrative that inflation is upon us so they can jack up their abysmally-low federal funds rate. That's because their experiment in quantitative easing (printing money) and ZIRP (Zero Interest Rate Policy) have proven to be dismal failures. Of course, they will never admit to that, or to the fact that roughly $14 trillion has been wasted or funneled directly or indirectly to the top 1% wealthiest people.
Bottom line is that without demand for goods and services, there can be no price inflation, because, using the standard metric of inflation being more money chasing fewer goods, while there's certainly more money out there, there's also no shortage of goods and services. In fact, were the economy not in such a dreadful state, more people would be opening new businesses, simply because there would be money to be made and not much in the way of competition.
As it stands today, most of the needs of the average, below average, and above average US citizen are pretty easily met. Food and clothing are cheap, and that's two of the three essentials for survival. The third, housing, is largely dictated by geography, so, in big cities, it's expensive. Out in the boonies, not so much.
All of this brings us to the real question, where is all the money coming from?
Another simple answer: debt, though it's not exactly as cut-and-dried as many would believe. Outstanding credit card debt continues to rise, but it's just a shade below $1 trillion, and, as for home equity loans, many people, and many bankers, learned a lifetime lesson in the Global Financial Crisis (GFC). Where the real money is coming from is debt related to car loans and higher education, aka, student loans, both of which reached all-time highs in the 4th quarter of last year.
Strange as it may seem, both are at higher nominal levels than credit card debt, at $1.407 trillion for car loans and $1.11 trillion in student loans. It seems odd that there would be more in just these two categories than everything that could be purchased with credit cards, which is, actually, everything. You can even pay taxes or register your car with a credit card, so it's readily apparent that there's an oversized appetite for new cars and degrees from colleges.
It doesn't really make sense. The vehicles on the road today may be the latest with all the greatest gadgets and widgets, but they're not much better than cars made in the past fifteen years, many of which are still reliably on the road. as for a college education, that has to be a societal miscalculation, because a degree in liberal anti-establishment cultural studies or whatever isn't going to pay for itself any time soon. It's a conundrum, a mismatch, a MALINVESTMENT, of which there are many, everywhere.
That's not to mention that the median cost of a new home is at another all-time high, but, as mentioned earlier, that's largely a local issue, but it bears notice that the average monthly payment of principle and interest (PI) for that median home is over $1000 a month.
So, if you find yourself all bollixed up over high credit card balances with high interest rates, don't worry. There are plenty of college graduates living in nice, new homes driving new cars who are in much worse shape than you.
If you're one of those people, we're all sorry, and we're having a drink to your ultimate demise, telling the bartender, "charge it."
"Compounded interest is the 8th wonder of the world. Those who don't understand it, pay it, and those who understand it, earn it."- Albert Einstein
At The Close, Tuesday, February 7, 2017:
Dow: 20,090.29, +37.87 (0.19%)
NASDAQ: 5,674.22, +10.66 (0.19%)
S&P 500: 2,293.08, +0.52 (0.02%)
NYSE Composite: 11,236.17, -27.94 (-0.25%)
Monday, February 6, 2017
The Rush To Safety Has Begun In Earnest; 10-Year Yields Drop to 2.41%
With one of the most amazing sporting spectacles - Super Bowl 51 (LI, for those of the Roman numeral persuasion) - behind, most people got back to work today, including the rabid money-grubbers of Wall Street, but all was not rosy and peachy after the New England Patriots won in overtime, 34-28, over the Atlanta Falcons.
As President Donald Trump continues to attempt to "make America great again," much of the focus on the first trading day of the week was not on stocks, but rather, bonds, most noticeably on the 10-year treasury note, which plummeted eight basis points on the day to produce the lowest yield in two weeks, to 2.41%.
That figure may not seem so attractive to the yield-seekers of the world, but to countless hedge and managed bond fund professionals, it was a pretty awesome start to the week. Prices - which preform in the opposite direction of yield - for the 10-year were rocketing higher and any continuation of the move over the next few days and through the week might make for a trend-setting reversion following weeks of speculation after the Fed hiked federal funds rates at the end of last year.
Stocks were down modestly, but that was antecedent to the speculative ride in bonds, which was focused on the long end, thereby flattening the curve. What is more than just passing interest in treasury bonds figures to keep a lid on stock prices for the near term, at least until the next Fed meeting, in mid-March, at which time the FOMC will likely keep interest rates at the same levels. It's simply going to be too early for the Fed to believe that the economy is on sound footing toward expansion, something they've been sniffing around for over the past eight years. To their dismay, and possible demise, the Fed hasn't found much in the data to suggest that the US economy is going to be great, again, or with any other adverbial disclaimer.
So, today can be summed up as bond traders getting calls to buy safety and executing on the wishes of their clients. Any assumption that the Trump rally or any other concoction of the news and financial media is going to send stocks even higher than the stratospheric levels they've already achieved in one of the longest multiple expansions in history may be similar to a dog whistle.
Dogs may hear it and lower-thinking humans might get a strange beeping sound, but long-term financial experts aren't going to notice. They've already made up their minds about where stocks are headed and, from today's indications, they're not going to a pleasant place.
Gird your loins and whatever else you might think appropriate for a trip of declining prices and some creative destruction in stocks. Hopefully, it won't be your money that's being lost.
At the Close, Monday, January 6, 2017:
Dow: 20,052.42, -19.04 (-0.09%)
NASDAQ: 5,663.55, -3.21 (-0.06%)
S&P 500: 2,292.56, -4.86 (-0.21%)
NYSE Composite: 11,264.11, -46.63 (-0.41%)
As President Donald Trump continues to attempt to "make America great again," much of the focus on the first trading day of the week was not on stocks, but rather, bonds, most noticeably on the 10-year treasury note, which plummeted eight basis points on the day to produce the lowest yield in two weeks, to 2.41%.
That figure may not seem so attractive to the yield-seekers of the world, but to countless hedge and managed bond fund professionals, it was a pretty awesome start to the week. Prices - which preform in the opposite direction of yield - for the 10-year were rocketing higher and any continuation of the move over the next few days and through the week might make for a trend-setting reversion following weeks of speculation after the Fed hiked federal funds rates at the end of last year.
Stocks were down modestly, but that was antecedent to the speculative ride in bonds, which was focused on the long end, thereby flattening the curve. What is more than just passing interest in treasury bonds figures to keep a lid on stock prices for the near term, at least until the next Fed meeting, in mid-March, at which time the FOMC will likely keep interest rates at the same levels. It's simply going to be too early for the Fed to believe that the economy is on sound footing toward expansion, something they've been sniffing around for over the past eight years. To their dismay, and possible demise, the Fed hasn't found much in the data to suggest that the US economy is going to be great, again, or with any other adverbial disclaimer.
So, today can be summed up as bond traders getting calls to buy safety and executing on the wishes of their clients. Any assumption that the Trump rally or any other concoction of the news and financial media is going to send stocks even higher than the stratospheric levels they've already achieved in one of the longest multiple expansions in history may be similar to a dog whistle.
Dogs may hear it and lower-thinking humans might get a strange beeping sound, but long-term financial experts aren't going to notice. They've already made up their minds about where stocks are headed and, from today's indications, they're not going to a pleasant place.
Gird your loins and whatever else you might think appropriate for a trip of declining prices and some creative destruction in stocks. Hopefully, it won't be your money that's being lost.
At the Close, Monday, January 6, 2017:
Dow: 20,052.42, -19.04 (-0.09%)
NASDAQ: 5,663.55, -3.21 (-0.06%)
S&P 500: 2,292.56, -4.86 (-0.21%)
NYSE Composite: 11,264.11, -46.63 (-0.41%)
Friday, February 3, 2017
What Wall Street Wants, Wall Street Gets; Trump Slashes Dodd-Frank
There's no better way to put it than to say that the Wall Street banks - Goldman Sachs, Bank of America, JP Morgan Chase, Morgan Stanley, Wells Fargo, and Citi - have Donald Trump's "get out of jail free" card in their back pockets.
Today's action by the President, an executive order slashing most of the regulations put on banks by the Dodd-Frank act under past-president Obama and the useless congress, paves the way for even looser regulations and more wild risk-taking by Wall Street.
And the celebration got underway right after the stupid BLS jobs report and the opening bell, boosting all major averages to within spitting distance of all-time highs.
Should anyone wonder if Mr. Trump knows anything about economics, one has only to look at his Treasury nominee, Steven Mnuchin, who led a group of investors in the take-out of IndyMac, later changing the name to OneWest while it became a serial abuser of mortgage financing and foreclosure laws.
While the former Goldman Sachs partner is not yet assured of passing muster in Senate confirmation, the appearance of yet another Goldman alumnus at the top finance job in the administration should be all one needs to know. Trump has long-standing associations with Wall Street, Goldman Sachs and financiers in general, so it isn't really a surprise.
Business will do business, whether or not it's moral, fiduciary, or based upon sound best practices. Wall Street retained control when Trump was elected, and would have even with Hillary as the president, so there's a bit of a silver lining in that at least the office of the president isn't occupied by a serial liar and psychopath. President Trump is better than the alternative, probably by more than anyone imagined.
After all the whipsaw activity of the past week, the major indices ended relatively unchanged. So, jobs data, the Fed, Trump, the EU, Japan, and the UK central bankers didn't actually add up to much at all.
Caveat Emptor
Carry on and Mind the Gap.
At the Close, Friday, February 3, 2017:
Dow: 20,071.46, +186.55 (0.94%)
NASDAQ: 5,666.77, +30.57 (0.54%)
S&P 500: 2,297.42, +16.57 (0.73%)
NYSE Composite: 11,311.74, +96.36 (0.86%)
For the Week:
Dow: -22.32 (-0.11%)
NASDAQ: +5.98 (0.11%)
S&P 500: +2.72 (0.12%)
NYSE Composite: +27.52 (+0.24%)
Today's action by the President, an executive order slashing most of the regulations put on banks by the Dodd-Frank act under past-president Obama and the useless congress, paves the way for even looser regulations and more wild risk-taking by Wall Street.
And the celebration got underway right after the stupid BLS jobs report and the opening bell, boosting all major averages to within spitting distance of all-time highs.
Should anyone wonder if Mr. Trump knows anything about economics, one has only to look at his Treasury nominee, Steven Mnuchin, who led a group of investors in the take-out of IndyMac, later changing the name to OneWest while it became a serial abuser of mortgage financing and foreclosure laws.
While the former Goldman Sachs partner is not yet assured of passing muster in Senate confirmation, the appearance of yet another Goldman alumnus at the top finance job in the administration should be all one needs to know. Trump has long-standing associations with Wall Street, Goldman Sachs and financiers in general, so it isn't really a surprise.
Business will do business, whether or not it's moral, fiduciary, or based upon sound best practices. Wall Street retained control when Trump was elected, and would have even with Hillary as the president, so there's a bit of a silver lining in that at least the office of the president isn't occupied by a serial liar and psychopath. President Trump is better than the alternative, probably by more than anyone imagined.
After all the whipsaw activity of the past week, the major indices ended relatively unchanged. So, jobs data, the Fed, Trump, the EU, Japan, and the UK central bankers didn't actually add up to much at all.
Caveat Emptor
Carry on and Mind the Gap.
At the Close, Friday, February 3, 2017:
Dow: 20,071.46, +186.55 (0.94%)
NASDAQ: 5,666.77, +30.57 (0.54%)
S&P 500: 2,297.42, +16.57 (0.73%)
NYSE Composite: 11,311.74, +96.36 (0.86%)
For the Week:
Dow: -22.32 (-0.11%)
NASDAQ: +5.98 (0.11%)
S&P 500: +2.72 (0.12%)
NYSE Composite: +27.52 (+0.24%)
Stocks Finish Flat Thursday, Friday Futures Boosted By Boffo BLS Jobs Report
Stocks finished the day Thursday relatively flat, but the big jobs number Friday should manage to erase any doubts about where the market is headed (spoiler alert: back over 20,000).
According to the ever-accurate-and-oft-revised BLS, he US economy added 227,000 jobs in January while the unemployment rate rose slightly to 4.8%. Economists were looking for payrolls to grow by 175,000 with the unemployment rate expected to hold steady at 4.7%.
So, more jobs, but the unemployment rate goes higher. Only in America, land of missed opportunities and bogus statistical data from the government.
Wages missed the mark, as average hourly earnings rose just 0.1%. The usual suspect "experts" were seeking a gain of 0.3%. Sorry, slaves. Back to work. However, the day is early, and though futures are rocketing higher, there's now the possibility that President Trump will unleash a tweet or two designed to fan the flames of confusion.
Just one question: Are we having fun yet?
At The Close, Thursday, February 2, 2017:
Dow: 19,884.91, -6.03 (-0.03%)
NASDAQ: 5,636.20, -6.45 (-0.11%)
S&P 500: 2,280.85, +1.30 (0.06%)
NYSE Composite: 11,215.38, +8.14 (0.07%)
According to the ever-accurate-and-oft-revised BLS, he US economy added 227,000 jobs in January while the unemployment rate rose slightly to 4.8%. Economists were looking for payrolls to grow by 175,000 with the unemployment rate expected to hold steady at 4.7%.
So, more jobs, but the unemployment rate goes higher. Only in America, land of missed opportunities and bogus statistical data from the government.
Wages missed the mark, as average hourly earnings rose just 0.1%. The usual suspect "experts" were seeking a gain of 0.3%. Sorry, slaves. Back to work. However, the day is early, and though futures are rocketing higher, there's now the possibility that President Trump will unleash a tweet or two designed to fan the flames of confusion.
Just one question: Are we having fun yet?
At The Close, Thursday, February 2, 2017:
Dow: 19,884.91, -6.03 (-0.03%)
NASDAQ: 5,636.20, -6.45 (-0.11%)
S&P 500: 2,280.85, +1.30 (0.06%)
NYSE Composite: 11,215.38, +8.14 (0.07%)
Wednesday, February 1, 2017
Fed On Hold, Markets Steady In Dull Session After Shaky Start To Week
With the Federal Reserve deciding that there would be no raise to the federal funds rate, as expected, US indices finished the day modestly higher, though the S&P 500 struggled to gain and the NYSE Composite finished in the red.
That was about all there was to the day, as investors took a break from the rabid pace set largely by President Trump's first ten days in office.
The next FOMC rate policy meeting isn't until March 14-15, though analysts and economists are still relatively certain that the Fed will continue to leave rates unchanged.
At The Close, Wednesday, February 1, 2016:
Dow: 19,890.94, +26.85 (0.14%)
NASDAQ: 5,642.65, +27.86 (0.50%)
S&P 500: 2,279.55, +0.68 (0.03%)
NYSE Composite: 11,207.24, -15.71 (-0.14%)
That was about all there was to the day, as investors took a break from the rabid pace set largely by President Trump's first ten days in office.
The next FOMC rate policy meeting isn't until March 14-15, though analysts and economists are still relatively certain that the Fed will continue to leave rates unchanged.
At The Close, Wednesday, February 1, 2016:
Dow: 19,890.94, +26.85 (0.14%)
NASDAQ: 5,642.65, +27.86 (0.50%)
S&P 500: 2,279.55, +0.68 (0.03%)
NYSE Composite: 11,207.24, -15.71 (-0.14%)
Tuesday, January 31, 2017
Stocks Drop, Rally In Split Session; Dow Down Three Straight; Apple Beats; Gold, Silver Rally
Beginning just after 2:00 pm ET, a furious rally brought US stock indices back from the depths of despair, finishing up Tuesday with a split decision, the S&P and Dow down, the NASDAQ and NYSE Comp. positive.
In close focus was the Dow Industrial Average, which was lower by as much as 186 points, but gathered back nearly half of that in the final two hours of the session. Leading the way lower were financial stocks, Goldman Sachs (GS) and JP Morgan Chase (JPM), the same companies that boosted the averages during the "Trump Rally" following November's election.
Now, it appears the euphoria over the presidency of Donald J. Trump is waning and enthusiasm for making America great again is falling prey to the harsh realities of economics, politics, and a divided country. Also weighing on stocks ae Trump's own bold initiatives, Twitter tweets and statements which appear to indicate that the 45th president is about to engage in an all-out, no-holds-barred currency and trade war with America's largest trading partners, in particular, China, Mexico and the European Union.
It just so happens that what President Trump is doing is exactly what he promised all during his campaign for the high office. Trump is truly an agent for change, but his changes - and the execution of them - are almost certainly not going to be smooth or predictable.
Today's targets of Trump ire included pharmaceutical companies, Germany and congress. Among other things, Trump told pharma execs to lower prices and move their operations back to the US.
Early in the day, President Trump's top trade advisor, Peter Navarro, said Germany was benefiting from a "grossly undervalued" euro, that gave Germany an unfair edge over US and fellow EU trading partners.
As for congress, Trump continues to hoot over the Democrats' stalling tactics on his cabinet nominees. In a procedural move, Democrat senators walked out on committee votes for nominations for Health and Human Services nominee, Tom Price, and Treasury pick, Steve Mnuchin. Democrats also delayed a vote (reportedly only until tomorrow) on Attorney General choice, Jeff Sessions, a position which has been the focus of vigorous debate.
All of this is providing cover for sellers and considerable confusion in global markets, sending the Dow into the red for a third straight day. Since the top tick of 20,125.58 on January 26 (last Thursday), the Dow has dipped 340 points intraday, or about 1.6%.
While it's still not enough to call a trend, it is worrying to some, especially since anybody with even marginal knowledge of stock valuations has to understand just how overvalued equities are, especially under the current changing environment.
Amid the carnage in stocks, gold and silver rallied sharply as the dollar slipped. Bond yields fell, with the 10-year note holding at 2.45%.
It's been often said that Wall Street hates uncertainty, and there's more than enough of that fueling the current dips and dives.
Just in after the close are Apple's (AAPL) earnings for its fiscal 2017 first quarter. Apple had $78.4 billion in gross revenue on expectations of $77.4 billion, and reported earnings of $3.36 per share on expectations of $3.21. IPhone sales were well beyond expectations. Shares of Apple were up more than three percent in after-hours trading, which should provide at least a temporary boost to stock prices tomorrow.
At the Close, Tuesday, 1.31.17:
Dow: 19,864.09, -107.04 (-0.54%)
NASDAQ: 5,614.79, +1.07 (0.02%)
S&P 500: 2,278.87, -2.03 (-0.09%)
NYSE Composite: 11,222.97, +17.73 (0.16%)
In close focus was the Dow Industrial Average, which was lower by as much as 186 points, but gathered back nearly half of that in the final two hours of the session. Leading the way lower were financial stocks, Goldman Sachs (GS) and JP Morgan Chase (JPM), the same companies that boosted the averages during the "Trump Rally" following November's election.
Now, it appears the euphoria over the presidency of Donald J. Trump is waning and enthusiasm for making America great again is falling prey to the harsh realities of economics, politics, and a divided country. Also weighing on stocks ae Trump's own bold initiatives, Twitter tweets and statements which appear to indicate that the 45th president is about to engage in an all-out, no-holds-barred currency and trade war with America's largest trading partners, in particular, China, Mexico and the European Union.
It just so happens that what President Trump is doing is exactly what he promised all during his campaign for the high office. Trump is truly an agent for change, but his changes - and the execution of them - are almost certainly not going to be smooth or predictable.
Today's targets of Trump ire included pharmaceutical companies, Germany and congress. Among other things, Trump told pharma execs to lower prices and move their operations back to the US.
Early in the day, President Trump's top trade advisor, Peter Navarro, said Germany was benefiting from a "grossly undervalued" euro, that gave Germany an unfair edge over US and fellow EU trading partners.
As for congress, Trump continues to hoot over the Democrats' stalling tactics on his cabinet nominees. In a procedural move, Democrat senators walked out on committee votes for nominations for Health and Human Services nominee, Tom Price, and Treasury pick, Steve Mnuchin. Democrats also delayed a vote (reportedly only until tomorrow) on Attorney General choice, Jeff Sessions, a position which has been the focus of vigorous debate.
All of this is providing cover for sellers and considerable confusion in global markets, sending the Dow into the red for a third straight day. Since the top tick of 20,125.58 on January 26 (last Thursday), the Dow has dipped 340 points intraday, or about 1.6%.
While it's still not enough to call a trend, it is worrying to some, especially since anybody with even marginal knowledge of stock valuations has to understand just how overvalued equities are, especially under the current changing environment.
Amid the carnage in stocks, gold and silver rallied sharply as the dollar slipped. Bond yields fell, with the 10-year note holding at 2.45%.
It's been often said that Wall Street hates uncertainty, and there's more than enough of that fueling the current dips and dives.
Just in after the close are Apple's (AAPL) earnings for its fiscal 2017 first quarter. Apple had $78.4 billion in gross revenue on expectations of $77.4 billion, and reported earnings of $3.36 per share on expectations of $3.21. IPhone sales were well beyond expectations. Shares of Apple were up more than three percent in after-hours trading, which should provide at least a temporary boost to stock prices tomorrow.
At the Close, Tuesday, 1.31.17:
Dow: 19,864.09, -107.04 (-0.54%)
NASDAQ: 5,614.79, +1.07 (0.02%)
S&P 500: 2,278.87, -2.03 (-0.09%)
NYSE Composite: 11,222.97, +17.73 (0.16%)
Global Markets Fall In Reaction To Trump Immigration Ban
In what may have been a completely convenient excuse to unwind some positions in overheated markets, analysts blamed Monday's global meltdown on US President Donald Trump's hastily-enacted immigration ban.
While the ban covers only seven countries - the same ones covered under a similar program under President Obama (Iran, Iraq, Syria, Yemen, Somalia, Libya, Sudan) - reaction from both affected and unaffected countries has been vocal, but especially in the US, where protesters (many of them paid) set up camp at airports in major cities.
Aside from the obvious left-leaning, liberal crying and tooth-gnashing, market participants largely over-reacted to the condition, giving pause to any instant analysis. What Trump may have done with the ban is fire a first volley in what may eventually prove to be an escalating trade war with the focus more on currency manipulation and tariffs than immigration limits and its consequences.
Not only were US markets lower on the day, equity indices around the world were down. That's an unusual circumstance worth noting, because, in the normal conduct of business, somebody's loss often results in gain somewhere else. Apparently, this was not the case, leading to the belief that the off-hand selling was little more than relief form overextended stocks.
On the flip side, this one-off event could be the beginning of a disorderly decline in the value of major equities around the globe and a beginning to the dismantling of a monetary system and bull market both of which are creaking from old age.
The days and weeks ahead should offer better insight to the overall direction of markets. Perhaps Trump's "America First" pledge means that US stocks will feel the brunt of the correction before the rest of the world gets on board. Deflation has reared its ugly head once again.
At The Close 1.30.17:
Dow: 19,971.13, -122.65 (-0.61%)
NASDAQ: 5,613.71, -47.07 (-0.83%)
S&P 500: 2,280.90, -13.79 (-0.60%)
NYSE Composite: 11,205.24, -77.95 (-0.69%)
While the ban covers only seven countries - the same ones covered under a similar program under President Obama (Iran, Iraq, Syria, Yemen, Somalia, Libya, Sudan) - reaction from both affected and unaffected countries has been vocal, but especially in the US, where protesters (many of them paid) set up camp at airports in major cities.
Aside from the obvious left-leaning, liberal crying and tooth-gnashing, market participants largely over-reacted to the condition, giving pause to any instant analysis. What Trump may have done with the ban is fire a first volley in what may eventually prove to be an escalating trade war with the focus more on currency manipulation and tariffs than immigration limits and its consequences.
Not only were US markets lower on the day, equity indices around the world were down. That's an unusual circumstance worth noting, because, in the normal conduct of business, somebody's loss often results in gain somewhere else. Apparently, this was not the case, leading to the belief that the off-hand selling was little more than relief form overextended stocks.
On the flip side, this one-off event could be the beginning of a disorderly decline in the value of major equities around the globe and a beginning to the dismantling of a monetary system and bull market both of which are creaking from old age.
The days and weeks ahead should offer better insight to the overall direction of markets. Perhaps Trump's "America First" pledge means that US stocks will feel the brunt of the correction before the rest of the world gets on board. Deflation has reared its ugly head once again.
At The Close 1.30.17:
Dow: 19,971.13, -122.65 (-0.61%)
NASDAQ: 5,613.71, -47.07 (-0.83%)
S&P 500: 2,280.90, -13.79 (-0.60%)
NYSE Composite: 11,205.24, -77.95 (-0.69%)
Monday, January 30, 2017
Stocks Close Friday Flat Ending Wild Week As Trump's Immigration Ban May Kill The Rally
Stocks cautiously ended the first full week of the Donald Trump presidency just as Mr. Trump unveiled his most audacious edict via executive order, barring immigration from countries embroiled in the throes of radical Islam such as Syria, Iraq, Yemen and four others.
While market participants have been somewhat encouraged by a number of first-week moves made by the new president, the promised immigration shutdown may have more implication globally than anybody may have wished. Stocks finished mixed in a week which witness a number of new all-time highs, particularly the Dow, which surpassed and held above the 20,000 level for the first time ever.
At the Close 1.27.16:
Dow: 20,093.78, -7.13 (-0.04%)
NASDAQ: 5,660.78, +5.61 (0.10%)
S&P 500: 2,294.69, -1.99 (-0.09%)
NYSE Composite: 11,283.19, -29.93 (-0.26)
On the week, all major indices sported gains, led by the NASDAQ and Dow Industrials, though the ramifications from the immigration ban were yet to be fully appreciated. As markets set to open in the US on Monday, futures indicated a negative open while markets around the world were suffering significant losses despite China and Hong Kong markets being closed all week for the Lunar New Year holiday. The tenor of trading suggests that markets may not be going along for the protectionist ride that the Trump administration has in mind. "America First" may well turn out to be the death knell for globalization, but the results of such radical policy changes is sure to increase market volatility, which, to this point has been benign.
For the week:
Dow: +266.53 (+1.34%)
NASDAQ: +105.45 (+1.90%)
S&P 500: +23.38 (+1.03%)
NYSE Composite: +90.39 (+0.81%)
While market participants have been somewhat encouraged by a number of first-week moves made by the new president, the promised immigration shutdown may have more implication globally than anybody may have wished. Stocks finished mixed in a week which witness a number of new all-time highs, particularly the Dow, which surpassed and held above the 20,000 level for the first time ever.
At the Close 1.27.16:
Dow: 20,093.78, -7.13 (-0.04%)
NASDAQ: 5,660.78, +5.61 (0.10%)
S&P 500: 2,294.69, -1.99 (-0.09%)
NYSE Composite: 11,283.19, -29.93 (-0.26)
On the week, all major indices sported gains, led by the NASDAQ and Dow Industrials, though the ramifications from the immigration ban were yet to be fully appreciated. As markets set to open in the US on Monday, futures indicated a negative open while markets around the world were suffering significant losses despite China and Hong Kong markets being closed all week for the Lunar New Year holiday. The tenor of trading suggests that markets may not be going along for the protectionist ride that the Trump administration has in mind. "America First" may well turn out to be the death knell for globalization, but the results of such radical policy changes is sure to increase market volatility, which, to this point has been benign.
For the week:
Dow: +266.53 (+1.34%)
NASDAQ: +105.45 (+1.90%)
S&P 500: +23.38 (+1.03%)
NYSE Composite: +90.39 (+0.81%)
Friday, January 27, 2017
Dow Higher, All Other Indices Lower?
“If you owe your bank manager a thousand pounds, you are at his mercy. If you owe him a million pounds, he is at your mercy.”― John Maynard Keynes
If you owe the bank $100 that's your problem. If you owe the bank $100 million, that's the bank's problem.-- J. Paul Getty
At The Close 1.26.17:
Dow: 20,100.91, +32.40 (0.16%)
NASDAQ: 5,655.18, -1.16 (-0.02%)
S&P 500: 2,296.68, -1.69 (-0.07%)
NYSE Composite: 11,313.13, -25.92 (-0.23%)
Wednesday, January 25, 2017
At Last! Dow Shatters 20,000 Mark; S&P 500, NASDAQ Also At Record Highs
No comment necessary since the topic of the Dow Jones Industrial Average breaking beyond 20,000 has been predicted, speculated upon, and beaten to death for more than a month running.
Incidentally, the S&P and NASDAQ also closed at record all-time highs.
The only question: will it hold?
Those of us who remember Dow 10,000 may recall that level being crossed some 57 times before finally moving on, so some back-and-forth is to be expected.
At the Close 1.25.17:
Dow: 20,068.51, +155.80 (0.78%)
NASDAQ: 5,656.34, +55.38 (0.99%)
S&P 500: 2,298.37, +18.30 (0.80%)
NYSE Composite: 11,342.70, +93.42 (0.83%)
Incidentally, the S&P and NASDAQ also closed at record all-time highs.
The only question: will it hold?
Those of us who remember Dow 10,000 may recall that level being crossed some 57 times before finally moving on, so some back-and-forth is to be expected.
At the Close 1.25.17:
Dow: 20,068.51, +155.80 (0.78%)
NASDAQ: 5,656.34, +55.38 (0.99%)
S&P 500: 2,298.37, +18.30 (0.80%)
NYSE Composite: 11,342.70, +93.42 (0.83%)
Tuesday, January 24, 2017
Yo-yo Stock Trading Continues; Dow Trading In Worst Rut Of 115 Years
Spurred by Democrat proposals for a $1 Trillion infrastructure spending bill, stocks took the high road, with the S&P 500 and NASDAQ each making new all-time highs. As has been the case of late, the Dow Industrials proved the laggards, not making new highs, but once again closing in on the mythical 20,000 level.
The Dow is now in a trading rut that happens to be the longest, smallest trading range since 1990. That's a long time, so it's going to break one way or the other. Tomorrow may prove to be the day it goes over 20,000, or not. As long as President Trump and congress continue to lay groundwork on a vast variety of programs and possible legislative agendas, the stock markets (which, as we've been told, hate uncertainty) will likely continue to bob and weave like lightweights.
The move higher today for the indices was led by basic material and energy stocks, in sympathy for President Trump's executive action to resume work on the troubled Keystone pipeline, a project that figures to be bullish for companies such as ExxonMobil and Chevron.
Still, since mid-December, the Dow has gone... nowhere, a condition that should not be able to persist much longer.
Or can it?
At the Close 1.24.17:
Dow: 19,912.71, +112.86 (0.57%)
NASDAQ: 5,600.96, +48.01 (0.86%)
S&P 500: 2,280.07, +14.87 (0.66%)
NYSE Composite: 11,249.29, +78.67 (0.70%)
The Dow is now in a trading rut that happens to be the longest, smallest trading range since 1990. That's a long time, so it's going to break one way or the other. Tomorrow may prove to be the day it goes over 20,000, or not. As long as President Trump and congress continue to lay groundwork on a vast variety of programs and possible legislative agendas, the stock markets (which, as we've been told, hate uncertainty) will likely continue to bob and weave like lightweights.
The move higher today for the indices was led by basic material and energy stocks, in sympathy for President Trump's executive action to resume work on the troubled Keystone pipeline, a project that figures to be bullish for companies such as ExxonMobil and Chevron.
Still, since mid-December, the Dow has gone... nowhere, a condition that should not be able to persist much longer.
Or can it?
At the Close 1.24.17:
Dow: 19,912.71, +112.86 (0.57%)
NASDAQ: 5,600.96, +48.01 (0.86%)
S&P 500: 2,280.07, +14.87 (0.66%)
NYSE Composite: 11,249.29, +78.67 (0.70%)
Monday, January 23, 2017
Trump Presidency Day One Sends Stocks Lower; Bonds, Precious Metals Up
Recall how everything was up on Friday, the day Donald Trump was sworn in as the 45th president of the United States?
Maybe it was a sugar high, market enthusiasm over the new faces in Washington, or just plain old vanilla speculation. Whatever it was, it certainly faded fast, as Monday, Trump's first full weekday as president saw markets getting closer and closer to a point of no return, at one point near midday having erased all of Friday's gains.
Fortunately for those of the bullish persuasion stocks held their own and finished with only minor losses. Oil was lower as well, though only marginally. In their places were some of the usual suspects from the other side of the trade; gold, silver, bonds, all rallied nicely. Gold continues to be the top asset performer for 2017, a welcome respite after three years of declines and a 2016 that saw it bounce nicely higher in the firt half of the year only to give back those gains in the second half, like a football team with a tiring defense.
As for the new president, he was busy. In the morning, President Trump met with business leaders and told them he'd like to roll back as much as 75% of existing regulations, most of them causing unnecessary reporting and tax burdens on businesses of all sizes.
Trump also signed three executive orders. One imposes a federal hiring freeze on all departments except the military, another pulled the US out of the Trans-Pacific Partnership (TPP), and the third re-imposed the so-called Mexico City Policy, outlawing funding of international organizations which promote abortion.
Previously, on Friday, when the President finally made his way to the Oval Office, he kept a campaign promise by signing an executive order that directs federal agencies to ease the “regulatory burdens” of ObamaCare. It orders agencies to “waive, defer, grant exemptions from, or delay the implementation of any provision or requirement” of ObamaCare that imposes a “fiscal burden on any State or a cost, fee, tax, penalty, or regulatory burden on individuals, families, healthcare providers, health insurers, patients, recipients of healthcare services, purchasers of health insurance, or makers of medical devices, products, or medications.”
One would think that the order covered just about everything, making ObamaCare a ruined piece of legislation, soon to be formally repealed.
There was also movement on clearing the way for confirmation of any number of the President's cabinet choices and more speculation on whether the congress would approve a tax overhaul suggested by Trump during the campaign. The changes are still off in the distance, but congress should be getting on with it as soon as the foot-dragging over cabinet nominees ends.
Use the calculator below to see how Trump's tax plan would affect you:
At The Close 1.23.17:
Dow: 19,799.85, -27.40 (-0.14%)
NASDAQ: 5,552.94, -2.39 (-0.04%)
S&P 500: 2,265.20, -6.11 (-0.27%)
NYSE Composite: 11,170.63, -22.16 (-0.20%)
Maybe it was a sugar high, market enthusiasm over the new faces in Washington, or just plain old vanilla speculation. Whatever it was, it certainly faded fast, as Monday, Trump's first full weekday as president saw markets getting closer and closer to a point of no return, at one point near midday having erased all of Friday's gains.
Fortunately for those of the bullish persuasion stocks held their own and finished with only minor losses. Oil was lower as well, though only marginally. In their places were some of the usual suspects from the other side of the trade; gold, silver, bonds, all rallied nicely. Gold continues to be the top asset performer for 2017, a welcome respite after three years of declines and a 2016 that saw it bounce nicely higher in the firt half of the year only to give back those gains in the second half, like a football team with a tiring defense.
As for the new president, he was busy. In the morning, President Trump met with business leaders and told them he'd like to roll back as much as 75% of existing regulations, most of them causing unnecessary reporting and tax burdens on businesses of all sizes.
Trump also signed three executive orders. One imposes a federal hiring freeze on all departments except the military, another pulled the US out of the Trans-Pacific Partnership (TPP), and the third re-imposed the so-called Mexico City Policy, outlawing funding of international organizations which promote abortion.
Previously, on Friday, when the President finally made his way to the Oval Office, he kept a campaign promise by signing an executive order that directs federal agencies to ease the “regulatory burdens” of ObamaCare. It orders agencies to “waive, defer, grant exemptions from, or delay the implementation of any provision or requirement” of ObamaCare that imposes a “fiscal burden on any State or a cost, fee, tax, penalty, or regulatory burden on individuals, families, healthcare providers, health insurers, patients, recipients of healthcare services, purchasers of health insurance, or makers of medical devices, products, or medications.”
One would think that the order covered just about everything, making ObamaCare a ruined piece of legislation, soon to be formally repealed.
There was also movement on clearing the way for confirmation of any number of the President's cabinet choices and more speculation on whether the congress would approve a tax overhaul suggested by Trump during the campaign. The changes are still off in the distance, but congress should be getting on with it as soon as the foot-dragging over cabinet nominees ends.
Use the calculator below to see how Trump's tax plan would affect you:
At The Close 1.23.17:
Dow: 19,799.85, -27.40 (-0.14%)
NASDAQ: 5,552.94, -2.39 (-0.04%)
S&P 500: 2,265.20, -6.11 (-0.27%)
NYSE Composite: 11,170.63, -22.16 (-0.20%)
Sunday, January 22, 2017
Best Wishes To President Trump; The Wall, Obamacare, Education
It's Official!
Donald J. Trump is the 45th president of the United States of America.
And the markets apparently loved it. The Dow was up. The NASDAQ was up. The S&P 500 was up. So was the Composite, the Nikkei, Gold, Silver, Oil, the dollar. Call it a relief rally. Market participants were relieved that the uncertainties of the past two years of electioneering, mudslinging, maligning, and campaigning were at long last, over. At least now some people can get to work, least of all the new president, like him, loathe him, or feign indifference, he's safely ensconced within the White House walls, with nary a cut, scrape, bruise, or wound.
At least that's what we're seeing through the prism of the news media. There were more than a few bruised egos at the swearing in ceremony on the West steps of the Capitol, facing the Washington and Lincoln monuments, but, some of the more expansive egos were soon swept off the stage and sent packing. The Clintons and the Obamas were whisked into obscurity by the forces of change.
As for our new president, Mr. Trump promises to be, at the very least, entertaining, if not outrageous. While such antics as late-night tweeting and calling people names may not sit well with his establishment critics, the American public will likely relish the shift from the obfuscation, misinformation, and underhandedness which typified the last 16 years of presidential conduct to a more - on the surface - open, progressive (that's a real word, meaning a real effort toward getting things done, not the fancy adversarial adjective applied over the last two decades by liberals), and positive approach to government policy.
It is obviously too early to tell whether President Trump will usher in a new age of American exceptionalism, but there is little doubt that he will try his best to keep his promises and work untiringly toward restoration of traditional American vales. There's also little doubt that he will face significant opposition from the left, the right, his own party, the Democrat party, liberal wingnuts who will protest anything at the drop of a hat, foreign leaders, the Twitterati, Facebook foes, and just about anybody who has an opinion on anything, many of whom will appear regularly on the vicious, unencumbered media whores doing their dirty work for the forces of their paymasters.
That's just how it goes when you rise to the top of the heap as Donald Trump has done. There's always somebody looking to knock you off your mighty throne, literally or figuratively. As for our sentiments here at the Money Daily headquarters, we wish him all the best and will continue to support him - as we did throughout the election process - as best we can. If he can deliver on even half of his campaign promises that would be quite an accomplishment, but we'll settle for three big items:
1. Build the damn wall.
2. Repeal the Affordable Care Act (it does not have to be replaced; we already have too many insurance companies, pharmaceutical companies and government involved in health care and would like to see much of that overhead removed)
3. Send education back to the states. The nation is too large and diverse (sorry, but the word does have its place) for a "one-size-fits-all" approach. Besides, the federal intrusion into education has been about as successful as the war on drugs or the war on poverty. Cut the Department of Education in half, or by two thirds, or, preferably, obliterate it.
In the meantime, Money Daily will try to stay out of politics and into money and economics, but, seeing the President and his staffers occasionally and regularly knee-cap the media whores wouldn't meet with any resistance from these parts.
Let the politicians do the dirty work. We'll aim to interpret the effects.
Let's start with a look down below at the weekly results. All four of the major indices were lower on the week, and that may be significant, but will be more so if that becomes a trend. The next two weeks are almost certain to be wild ones in terms of politicking and figurative bomb-throwing from the left, the right, and everywhere in between, but, if stocks continue to deteriorate (which happens to be our best guess for now), it's going to put more pressure on the new president. Not that he should do anything about it since he has no control of financial markets, but the media will crow endlessly about how the economy is going into the tank under the Trump administration.
We'll leave it there, for now. It's going to get a whole lot more interesting in coming weeks and months.
At The Close 1.20.17:
Dow: 19,827.25, +94.85 (0.48%)
NASDAQ: 5,555.33, +15.25 (0.28%)
S&P 500: 2,271.31, +7.62 (0.34%)
NYSE Composite: 11,192.79, +43.94 (0.39%)
For the Week Ended 1.20.17:
Dow: -58.48 (-0.29%)
NASDAQ: -18.78 (-0.34%)
S&P 500: -3.33 (-0.15%)
NYSE Composite: -34.38 (-0.31)
Donald J. Trump is the 45th president of the United States of America.
And the markets apparently loved it. The Dow was up. The NASDAQ was up. The S&P 500 was up. So was the Composite, the Nikkei, Gold, Silver, Oil, the dollar. Call it a relief rally. Market participants were relieved that the uncertainties of the past two years of electioneering, mudslinging, maligning, and campaigning were at long last, over. At least now some people can get to work, least of all the new president, like him, loathe him, or feign indifference, he's safely ensconced within the White House walls, with nary a cut, scrape, bruise, or wound.
At least that's what we're seeing through the prism of the news media. There were more than a few bruised egos at the swearing in ceremony on the West steps of the Capitol, facing the Washington and Lincoln monuments, but, some of the more expansive egos were soon swept off the stage and sent packing. The Clintons and the Obamas were whisked into obscurity by the forces of change.
As for our new president, Mr. Trump promises to be, at the very least, entertaining, if not outrageous. While such antics as late-night tweeting and calling people names may not sit well with his establishment critics, the American public will likely relish the shift from the obfuscation, misinformation, and underhandedness which typified the last 16 years of presidential conduct to a more - on the surface - open, progressive (that's a real word, meaning a real effort toward getting things done, not the fancy adversarial adjective applied over the last two decades by liberals), and positive approach to government policy.
It is obviously too early to tell whether President Trump will usher in a new age of American exceptionalism, but there is little doubt that he will try his best to keep his promises and work untiringly toward restoration of traditional American vales. There's also little doubt that he will face significant opposition from the left, the right, his own party, the Democrat party, liberal wingnuts who will protest anything at the drop of a hat, foreign leaders, the Twitterati, Facebook foes, and just about anybody who has an opinion on anything, many of whom will appear regularly on the vicious, unencumbered media whores doing their dirty work for the forces of their paymasters.
That's just how it goes when you rise to the top of the heap as Donald Trump has done. There's always somebody looking to knock you off your mighty throne, literally or figuratively. As for our sentiments here at the Money Daily headquarters, we wish him all the best and will continue to support him - as we did throughout the election process - as best we can. If he can deliver on even half of his campaign promises that would be quite an accomplishment, but we'll settle for three big items:
1. Build the damn wall.
2. Repeal the Affordable Care Act (it does not have to be replaced; we already have too many insurance companies, pharmaceutical companies and government involved in health care and would like to see much of that overhead removed)
3. Send education back to the states. The nation is too large and diverse (sorry, but the word does have its place) for a "one-size-fits-all" approach. Besides, the federal intrusion into education has been about as successful as the war on drugs or the war on poverty. Cut the Department of Education in half, or by two thirds, or, preferably, obliterate it.
In the meantime, Money Daily will try to stay out of politics and into money and economics, but, seeing the President and his staffers occasionally and regularly knee-cap the media whores wouldn't meet with any resistance from these parts.
Let the politicians do the dirty work. We'll aim to interpret the effects.
Let's start with a look down below at the weekly results. All four of the major indices were lower on the week, and that may be significant, but will be more so if that becomes a trend. The next two weeks are almost certain to be wild ones in terms of politicking and figurative bomb-throwing from the left, the right, and everywhere in between, but, if stocks continue to deteriorate (which happens to be our best guess for now), it's going to put more pressure on the new president. Not that he should do anything about it since he has no control of financial markets, but the media will crow endlessly about how the economy is going into the tank under the Trump administration.
We'll leave it there, for now. It's going to get a whole lot more interesting in coming weeks and months.
At The Close 1.20.17:
Dow: 19,827.25, +94.85 (0.48%)
NASDAQ: 5,555.33, +15.25 (0.28%)
S&P 500: 2,271.31, +7.62 (0.34%)
NYSE Composite: 11,192.79, +43.94 (0.39%)
For the Week Ended 1.20.17:
Dow: -58.48 (-0.29%)
NASDAQ: -18.78 (-0.34%)
S&P 500: -3.33 (-0.15%)
NYSE Composite: -34.38 (-0.31)
Thursday, January 19, 2017
Globalism Is Dead And Dying At Davos
As the world prepares for a new American era to begin with the inauguration of Donald J. Trump as the 45th president of the United States, the global elites are gathered at Davos to interpret the condition of the world economy.
Ian Goldin, a professor of globalization and development at Oxford University spoke briefly at the World Economic Forum in Davos, Switzerland, saying,
If one were living in a rural area in America, or India, or the Congo, even, the effects of global initiatives like those espoused and implemented by the people at Davos would be minimal, at best. One would still water plants, feed livestock, wash eggs, and perform all the other chores of a minimal farming/subsistence lifestyle. Mr. Goldin, being of the elitist character, has virtually no concept of digging holes for posts, erecting fences, germinating seed, slaughtering hogs, gathering chicken eggs daily, and so on. He's about as disconnected from the reality of everyday life as one could possibly be, viewing the world from his ivory tower at Oxford as he glances up briefly from his reading of some other obviously clueless professor emeritus or other "authority" whose mantra to which he subscribes.
Therefore, as we've seen in the Brexit movement and the election of Donald Trump as the next president of the United States of America, the globalist agenda is dead in the water, disconnected and disintegrating. The annual fete at Davos - through the media filter, at least - gives everyone an opportunity to see firsthand just how audaciously and vigorously the gathered elitists continue to promote their agendas. Liberalism, diversity, and globalism are all joined together into a kind of religion of the rich and powerful, but, the masses need not adhere to what is looking increasingly like failed policy.
If globalism has taken thirty or forty years to expand itself into monstrosities such as the European Union, the Arab Spring, and unadulterated acceptance of gay marriage, it's likely going to take an equal amount of time to dismantle its various parts and replace them with more stable value systems. As the globalists retreat from their worn-out traditions and values, popular uprisings will accelerate the decline. It starts, as do all major moral or political or economic upheavals, on the fringes of society, in the hinterlands, so to speak, before spreading to all ranges of the spectrum, from old to young, from the countryside to the cityscape.
We are at the beginning of a new age, one which promises the demise of authority at all levels from local to supranational and more freedom for the working classes and ordinary citizens.
On cue, one day before the actual inauguration of the man all the "experts" said had no chance of winning, Donald Trump, world markets continued a dizzy dance of denial and suspense, especially the Dow Jones Industrial Average, which spasmodically descended today to a point below where it began the year, closing at its lowest level since Decemeber 30 of last year (19,732.40, -72.32 (-0.37%)).
Though the drop in percentage terms was hardly sensational, the level is of more immediate concern. Since December 12, the intraday level never fell below 19,718, the mark made on the final day of trading for 2016, December 30.
While broader indices, the S&P 500 and the NASDAQ, retained a positive tilt for 2017, it has been the Dow that garnered the most attention of late, especially over its historic (failed) attempt to crack the 20,000 level.
With Trump taking the oath of office at noon tomorrow, the question on every trader's mind is how the markets will respond. With a whimper or a yawn, or might the Dow set aim again for an historic close?
At The Close 1.19.16:
Dow 19,732.40, -72.32 (-0.37%)
NASDAQ: 5,540.08, -15.57 (-0.28%)
S&P 500: 2,263.69, -8.20 (-0.36%)
NYSE Composite: 11,151.69, -44.41 (-0.40%)
Ian Goldin, a professor of globalization and development at Oxford University spoke briefly at the World Economic Forum in Davos, Switzerland, saying,
“You can’t stop managing an entangled environment by disconnecting. This is the fundamental mistake of Brexit, of Trump, and of so many others. We are not simply connected. We are entangled. Our lives, our destinies are intertwined. What happens in China, what happens in Indonesia, what happens in India, what happens across Europe, and what happens in North America, across Africa and Latin America will affect all of us in dramatic new ways. The idea that somehow we can forge our future in an insular way, even for the biggest countries like the U.S., is a fantasy.”Obviously, Mr. Goldin has been smoking too much of what he's been growing over the past couple of decades. To put it into a more precise perspective, Mr. Goldin kneels at the altar of globalization, thus, he's unprepared to express or even admit that there's any other opinion or world view than the one he personally promotes.
If one were living in a rural area in America, or India, or the Congo, even, the effects of global initiatives like those espoused and implemented by the people at Davos would be minimal, at best. One would still water plants, feed livestock, wash eggs, and perform all the other chores of a minimal farming/subsistence lifestyle. Mr. Goldin, being of the elitist character, has virtually no concept of digging holes for posts, erecting fences, germinating seed, slaughtering hogs, gathering chicken eggs daily, and so on. He's about as disconnected from the reality of everyday life as one could possibly be, viewing the world from his ivory tower at Oxford as he glances up briefly from his reading of some other obviously clueless professor emeritus or other "authority" whose mantra to which he subscribes.
Therefore, as we've seen in the Brexit movement and the election of Donald Trump as the next president of the United States of America, the globalist agenda is dead in the water, disconnected and disintegrating. The annual fete at Davos - through the media filter, at least - gives everyone an opportunity to see firsthand just how audaciously and vigorously the gathered elitists continue to promote their agendas. Liberalism, diversity, and globalism are all joined together into a kind of religion of the rich and powerful, but, the masses need not adhere to what is looking increasingly like failed policy.
If globalism has taken thirty or forty years to expand itself into monstrosities such as the European Union, the Arab Spring, and unadulterated acceptance of gay marriage, it's likely going to take an equal amount of time to dismantle its various parts and replace them with more stable value systems. As the globalists retreat from their worn-out traditions and values, popular uprisings will accelerate the decline. It starts, as do all major moral or political or economic upheavals, on the fringes of society, in the hinterlands, so to speak, before spreading to all ranges of the spectrum, from old to young, from the countryside to the cityscape.
We are at the beginning of a new age, one which promises the demise of authority at all levels from local to supranational and more freedom for the working classes and ordinary citizens.
On cue, one day before the actual inauguration of the man all the "experts" said had no chance of winning, Donald Trump, world markets continued a dizzy dance of denial and suspense, especially the Dow Jones Industrial Average, which spasmodically descended today to a point below where it began the year, closing at its lowest level since Decemeber 30 of last year (19,732.40, -72.32 (-0.37%)).
Though the drop in percentage terms was hardly sensational, the level is of more immediate concern. Since December 12, the intraday level never fell below 19,718, the mark made on the final day of trading for 2016, December 30.
While broader indices, the S&P 500 and the NASDAQ, retained a positive tilt for 2017, it has been the Dow that garnered the most attention of late, especially over its historic (failed) attempt to crack the 20,000 level.
With Trump taking the oath of office at noon tomorrow, the question on every trader's mind is how the markets will respond. With a whimper or a yawn, or might the Dow set aim again for an historic close?
At The Close 1.19.16:
Dow 19,732.40, -72.32 (-0.37%)
NASDAQ: 5,540.08, -15.57 (-0.28%)
S&P 500: 2,263.69, -8.20 (-0.36%)
NYSE Composite: 11,151.69, -44.41 (-0.40%)
Wednesday, January 18, 2017
Risk On - Risk Off Roller Coaster Is Expected In The Age Of Trump
Get used to volatility in the age of Trump.
Markets - especially stocks and bonds - are more than likely to correct and enter bear territory during Trump's administration. The bond bubble has been extended beyond its "use by" date and the stock rally since 2009 has been nothing short of miraculous, if one considers the creation of 11 trillion dollars (probably more) out of thin air to be the stuff of miracles.
Stocks and bonds are both overvalued, thus, we should experience a 10-year note at 3.0% or higher at some point in the near future, and stocks reversing course due to the competition and relative safety of bonds. Trump's policies are likely to exacerbate the condition of extreme overvaluation which will manifest itself in wild swings. He'll certainly get much needed help from the Fed, whose stated aim is to impose a regime of never-ending inflation.
Problem is, there are major distortions in the US and global economy, mostly the overhang from doing nothing to fix the issues of 2008 (actual bank failures). Let's see interest rates rise, stocks fall and somehow, inflation? A dubious argument at best.
Deflation is the friend of the frugal and that's what's coming. With less capital to blow on hookers and blow, the thrift-loving Americans in the heartland (forget the cesspool cities, they're toast) will benefit from all manner of liquidations and fire sales. It's a transfer of wealth from rich to poor and urban to rural that is long overdue. Most of the debt is tied to cities, not arable land and/or hunting/wilderness/undeveloped/underdeveloped properties.
One can get a unique impression from living in one of America's poorer areas, such as rural upstate New York, but you know what? Some people are thriving, those being land owners, farmers, growers, people with roadside stands, trade specialties, mechanical abilities and low overhead. It's pretty basic stuff, but large swaths of rural America are going to be very affordable and desirable. The cites, not so much. Pain for some, gain for others. The survivalist mentality had it right all along and will be proven winners in coming months and years.
As for today, two days before Mr. Trump assumes the office of president, markets were roiled again, lurching from one idea to another, up, then down, then sideways. European stocks were higher, WTI crude oil got smashed early but rebounded. Gold was flat, then lower; silver, always the outlier, hit its best level in a month, ended the day in New York down on the session, and has been trending higher into the inauguration, but options and futures settlements are closing fast (26th and 27th of January).
Mostly, stocks tread water and didn't offer much in the way of direction though by now, unless reading charts is grossly overrated, it's apparent that the Trump rally has run its course and Dow 20,000 is a fleeting memory.
At The Close 1.18.16:
Dow: 19,804.72, -22.05 (-0.11%)
NASDAQ: 5,555.65, +16.93 (0.31%)
S&P 500: 2,271.89, +4.00 (0.18%)
NYSE Composite: 11,196.11, -0.18 (-0.00%)
Markets - especially stocks and bonds - are more than likely to correct and enter bear territory during Trump's administration. The bond bubble has been extended beyond its "use by" date and the stock rally since 2009 has been nothing short of miraculous, if one considers the creation of 11 trillion dollars (probably more) out of thin air to be the stuff of miracles.
Stocks and bonds are both overvalued, thus, we should experience a 10-year note at 3.0% or higher at some point in the near future, and stocks reversing course due to the competition and relative safety of bonds. Trump's policies are likely to exacerbate the condition of extreme overvaluation which will manifest itself in wild swings. He'll certainly get much needed help from the Fed, whose stated aim is to impose a regime of never-ending inflation.
Problem is, there are major distortions in the US and global economy, mostly the overhang from doing nothing to fix the issues of 2008 (actual bank failures). Let's see interest rates rise, stocks fall and somehow, inflation? A dubious argument at best.
Deflation is the friend of the frugal and that's what's coming. With less capital to blow on hookers and blow, the thrift-loving Americans in the heartland (forget the cesspool cities, they're toast) will benefit from all manner of liquidations and fire sales. It's a transfer of wealth from rich to poor and urban to rural that is long overdue. Most of the debt is tied to cities, not arable land and/or hunting/wilderness/undeveloped/underdeveloped properties.
One can get a unique impression from living in one of America's poorer areas, such as rural upstate New York, but you know what? Some people are thriving, those being land owners, farmers, growers, people with roadside stands, trade specialties, mechanical abilities and low overhead. It's pretty basic stuff, but large swaths of rural America are going to be very affordable and desirable. The cites, not so much. Pain for some, gain for others. The survivalist mentality had it right all along and will be proven winners in coming months and years.
As for today, two days before Mr. Trump assumes the office of president, markets were roiled again, lurching from one idea to another, up, then down, then sideways. European stocks were higher, WTI crude oil got smashed early but rebounded. Gold was flat, then lower; silver, always the outlier, hit its best level in a month, ended the day in New York down on the session, and has been trending higher into the inauguration, but options and futures settlements are closing fast (26th and 27th of January).
Mostly, stocks tread water and didn't offer much in the way of direction though by now, unless reading charts is grossly overrated, it's apparent that the Trump rally has run its course and Dow 20,000 is a fleeting memory.
At The Close 1.18.16:
Dow: 19,804.72, -22.05 (-0.11%)
NASDAQ: 5,555.65, +16.93 (0.31%)
S&P 500: 2,271.89, +4.00 (0.18%)
NYSE Composite: 11,196.11, -0.18 (-0.00%)
Tuesday, January 17, 2017
Donald Trump Moves Markets; Hugo Salinas Price Details Decline In International Reserves
It was back to work on Tuesday for US speculators, and the mood was gloomy as president-elect Donald Trump quipped that the "dollar is too strong," which sent world markets into a wild frenzy.
Asian and European markets had already been upset on Monday, while the US rested for the Martin Luther King Jr. holiday, but on Trump's vocalizing of displeasure, US markets took it to heart.
The Dow Jones Industrial Average backed away from the formerly-attainable 20,000 mark, down 110 points on Monday before a late rally slashed the losses in half.
It is apparent that the euphoria over Trump has faded significantly and American investors are heading for safer shores, mostly in bonds and cash, though precious metals may have even more appeal with gold and silver both making new highs for the year on significant gains. Spot silver stood at 17.175 and gold at 1216.70 at the close of trading in New York, but the rally may be just beginning to heat up.
Hugo Salinas Price makes important notice of the abrupt decline in international reserves. Of all the reports on matters economic, his may be the most acute and insightful. It's a must read and should be given careful consideration due to Mr. Price's status among economic thinkers.
At the Close 1.17.16:
Dow: 19,826.77, -58.96 (-0.30%)
NASDAQ: 5,538.73, -35.39 (-0.63%)
S&P 500: 2,267.89, -6.75 (-0.30%)
NYSE Composite: 11,190.76, -36.41 (-0.32%)
Asian and European markets had already been upset on Monday, while the US rested for the Martin Luther King Jr. holiday, but on Trump's vocalizing of displeasure, US markets took it to heart.
The Dow Jones Industrial Average backed away from the formerly-attainable 20,000 mark, down 110 points on Monday before a late rally slashed the losses in half.
It is apparent that the euphoria over Trump has faded significantly and American investors are heading for safer shores, mostly in bonds and cash, though precious metals may have even more appeal with gold and silver both making new highs for the year on significant gains. Spot silver stood at 17.175 and gold at 1216.70 at the close of trading in New York, but the rally may be just beginning to heat up.
Hugo Salinas Price makes important notice of the abrupt decline in international reserves. Of all the reports on matters economic, his may be the most acute and insightful. It's a must read and should be given careful consideration due to Mr. Price's status among economic thinkers.
At the Close 1.17.16:
Dow: 19,826.77, -58.96 (-0.30%)
NASDAQ: 5,538.73, -35.39 (-0.63%)
S&P 500: 2,267.89, -6.75 (-0.30%)
NYSE Composite: 11,190.76, -36.41 (-0.32%)
Saturday, January 14, 2017
NASDAQ Posts Seventh Record Of 2017; Dow Flat; Gold Outperforming All Other Assets
As America lurches toward inauguration day (Jan. 20), stocks remain a mixed bag.
The Dow ended the week with a small loss on Friday as the NASDAQ rose to another record close, its seventh this year.
For the week, the NAZ was up nearly one percent. The Dow's loss was minor, at less than one half percent (-0.39%), but the broader S&P and NYSE composite suffered almost no depreciation.
Overall, it was fairly uneventful in markets, which is odd, given the cross-currents blowing through the political and economic spectrum.
Next week, with the inauguration of Donald J. Trump as America's 45th president putting a final glow on the proceedings, promises to be a more volatile period, shortened by one day, as markets are idle for Monday's Martin Luther King holiday.
Ominously, the Dow Jones Industrial Average remains positioned below the expected 20,000 level but has been flat as a pancake for the past four weeks.
WTI crude oil remains mired in the mid-fifties, while gold, the year's best-performing asset thus far, pierced the 1200/oz. mark on Friday but fell off and closed at 1196.90 the ounce.
At The Close 1.13.16:
Dow: 19,885.73, -5.27 (-0.03%)
NASDAQ: 5,574.12, +26.63 (0.48%)
S&P 500: 2,274.64, +4.20 (0.18%)
NYSE Composite: 11,227.17, +23.02 (0.21%)
Week Ending 1.13.16:
Dow: -78.07 (-0.39%)
NASDAQ: +53.06 (0.96%)
S&P 500: -2.34 (-0.10%)
NYSE Composite: -10.45 (-0.09%)
The Dow ended the week with a small loss on Friday as the NASDAQ rose to another record close, its seventh this year.
For the week, the NAZ was up nearly one percent. The Dow's loss was minor, at less than one half percent (-0.39%), but the broader S&P and NYSE composite suffered almost no depreciation.
Overall, it was fairly uneventful in markets, which is odd, given the cross-currents blowing through the political and economic spectrum.
Next week, with the inauguration of Donald J. Trump as America's 45th president putting a final glow on the proceedings, promises to be a more volatile period, shortened by one day, as markets are idle for Monday's Martin Luther King holiday.
Ominously, the Dow Jones Industrial Average remains positioned below the expected 20,000 level but has been flat as a pancake for the past four weeks.
WTI crude oil remains mired in the mid-fifties, while gold, the year's best-performing asset thus far, pierced the 1200/oz. mark on Friday but fell off and closed at 1196.90 the ounce.
At The Close 1.13.16:
Dow: 19,885.73, -5.27 (-0.03%)
NASDAQ: 5,574.12, +26.63 (0.48%)
S&P 500: 2,274.64, +4.20 (0.18%)
NYSE Composite: 11,227.17, +23.02 (0.21%)
Week Ending 1.13.16:
Dow: -78.07 (-0.39%)
NASDAQ: +53.06 (0.96%)
S&P 500: -2.34 (-0.10%)
NYSE Composite: -10.45 (-0.09%)
Thursday, January 12, 2017
Stocks Slump, Regain Ground In Anxious Session
Yesterday, it was big pharma that took a hit after Donald Trump singled them out in his press conference, saying that the US government would begin bidding lower prices for many prescription drugs.
Today, health care insurance companies took the hit - if only briefly - as the senate pushed forward a bill to repeal the Affordable Care Act (ACA), otherwise known as Obamacare. Aetna, Anthem, Cigna and United Health were among a handful of companies that felt some shock at the open.
The Senate voted 51-48 on a measure to repeal the current president's signature health initiative. The measure now will move to the house where its passage is all but assured, with the membership heavily weighted with Republicans.
As for the rest of the market, stocks went red at the open and trimmed early losses after 11:00 am ET. The Dow was down more than 180 points in the early going, but manage to recover almost two thirds of the losses as the session dragged forward.
Missing from the narrative today was the chorus of "Dow 20000," as the industrial index extended its failed attempt at the historic milestone for the 22nd straight session.
Maybe tomorrow...
At The Close 1.12.16:
Dow: 19,891.00, -63.28 (-0.32%)
NASDAQ: 5,547.49, -16.16 (-0.29%)
S&P 500: 2,270.44, -4.88 (-0.21%)
NYSE Composite: 11,204.15, -22.63 (-0.20%)
Today, health care insurance companies took the hit - if only briefly - as the senate pushed forward a bill to repeal the Affordable Care Act (ACA), otherwise known as Obamacare. Aetna, Anthem, Cigna and United Health were among a handful of companies that felt some shock at the open.
The Senate voted 51-48 on a measure to repeal the current president's signature health initiative. The measure now will move to the house where its passage is all but assured, with the membership heavily weighted with Republicans.
As for the rest of the market, stocks went red at the open and trimmed early losses after 11:00 am ET. The Dow was down more than 180 points in the early going, but manage to recover almost two thirds of the losses as the session dragged forward.
Missing from the narrative today was the chorus of "Dow 20000," as the industrial index extended its failed attempt at the historic milestone for the 22nd straight session.
Maybe tomorrow...
At The Close 1.12.16:
Dow: 19,891.00, -63.28 (-0.32%)
NASDAQ: 5,547.49, -16.16 (-0.29%)
S&P 500: 2,270.44, -4.88 (-0.21%)
NYSE Composite: 11,204.15, -22.63 (-0.20%)
Wednesday, January 11, 2017
Trump Presser A Non-Event; America Awaits Inauguration
Though widely-anticipated as a market moving event, President-Elect Donald J. Trump's press conference at 11;00 ET today was more or less an exercise in sell the hype, buy the news.
Trump handled questions about the "fake news" Russian dossiers widely circulated by CNN and other outlets and quickly dismissed them as nonsense. The audacious level of mendacity displayed by the mainstream media in the run-up to the inauguration of America's 45th president has been unconscionable and unprecedented, but the Donald managed to deflect any potential harm as the media and intelligence community reports have been devoid of facts or proof of their veracity.
Other than waving off and refusing to take questions from anybody from CNN, Trump laid out basically the same nebulous outlines upon which he campaigned, without getting too specific. Thus, what the market wanted was not what they received, but traders were assuaged by the one-hour appearance and resumed trading within the prevailing range of the past month, between 19,800 and 19,999.
If the market seems moribund, it's likely the result of non-specifics from the soon-to-be-sitting president, meaning this regime of up-down-up-down may persist through the next week, culminating in next Friday's inauguration.
Otherwise, it was another uneventful day, with the Dow still planted just south of 20K.
At the Close 1.11.16
Dow: 19,954.28, +98.75 (0.50%)
NASDAQ: 5,563.65, +11.83 (0.21%)
S&P 500: 2,275.32, +6.42 (0.28%)
NYSE Composite: 11,221.92, +38.59 (0.35%)
Trump handled questions about the "fake news" Russian dossiers widely circulated by CNN and other outlets and quickly dismissed them as nonsense. The audacious level of mendacity displayed by the mainstream media in the run-up to the inauguration of America's 45th president has been unconscionable and unprecedented, but the Donald managed to deflect any potential harm as the media and intelligence community reports have been devoid of facts or proof of their veracity.
Other than waving off and refusing to take questions from anybody from CNN, Trump laid out basically the same nebulous outlines upon which he campaigned, without getting too specific. Thus, what the market wanted was not what they received, but traders were assuaged by the one-hour appearance and resumed trading within the prevailing range of the past month, between 19,800 and 19,999.
If the market seems moribund, it's likely the result of non-specifics from the soon-to-be-sitting president, meaning this regime of up-down-up-down may persist through the next week, culminating in next Friday's inauguration.
Otherwise, it was another uneventful day, with the Dow still planted just south of 20K.
At the Close 1.11.16
Dow: 19,954.28, +98.75 (0.50%)
NASDAQ: 5,563.65, +11.83 (0.21%)
S&P 500: 2,275.32, +6.42 (0.28%)
NYSE Composite: 11,221.92, +38.59 (0.35%)
Tuesday, January 10, 2017
Dow 20000 No Go Again; Is The Trump Rally Over?
In 2016, having first crossed the 19,800 point on December 12 and closing above 19,900 the following day, one would have thought that crossing the 20,000 rubicon for the Dow Jones Industrial Average would have been a slam dunk before New Year.
It wasn't and it still isn't. Like the final five yards on a scoring football drive, the final 100-200 points on the widely-watched blue chip index are proving to be tough, resistant, and, at this point, possibly a field goal attempt would be in order. Or a punt.
Including the 12th of December, it's been 20 days since the "Dow 20,000" baseball caps began circulating, but nobody's been able to don one just yet. There has been more than a fair share of drama over the simply psychological level, especially this past Friday, when the average fell just 0.37 points short of making magic.
But twenty days of hanging just below the number is giving some investors cause to pause and consider that the eight-year bull market - and more specifically, the massive post-election Trump rally - is finally tiring and about to head back to the corral. And if that happens, the confidence so prevalent the past few months will have been for naught unless one had the foresight to sell into the rally at some point.
Stocks continue to be highly valued, some say overbought. The last meaningful decline was in January of last year when the Dow and other indices took a hit somewhere between 12 and 15%. Though that particular correction never materialized into a bear market, it was a confidence-shaker and those who suffered losses are wont to forget it.
Taking a stab in the dark, it would appear that speculators are more interested in NASDAQ stocks, which continue to tear up new highs, just as the Dow is stalling. Could the NAZ pull the Dow along with it, or does the Dow hold the losing hand with which it will eventually pull down the composite, S&P, transports, et. al.?
With the Dow ending today roughly 150 points from the requisite top, it's still out there for the taking, though there seems to be no catalyst for any kind of extended move, so, reiterating past posts, even if the Dow makes the mark, it's doubtful it would hold for long. A correction is in the cards and it's likely to be swift rather than a slow grind, so day traders must keep stop losses close to the vest and hang on with all their fright. Yes, that's no typo. Fear and greed rule the markets and the fear index is on the rise.
At the Close 1.10.16:
Dow: 19,855.53, -31.85 (-0.16%)
NASDAQ: 5,551.82, +20.00 (0.36%)
S&P 500: 2,268.90, 0.00 (0.00%)
NYSE Composite: 11,183.33, +13.54 (0.12%)
It wasn't and it still isn't. Like the final five yards on a scoring football drive, the final 100-200 points on the widely-watched blue chip index are proving to be tough, resistant, and, at this point, possibly a field goal attempt would be in order. Or a punt.
Including the 12th of December, it's been 20 days since the "Dow 20,000" baseball caps began circulating, but nobody's been able to don one just yet. There has been more than a fair share of drama over the simply psychological level, especially this past Friday, when the average fell just 0.37 points short of making magic.
But twenty days of hanging just below the number is giving some investors cause to pause and consider that the eight-year bull market - and more specifically, the massive post-election Trump rally - is finally tiring and about to head back to the corral. And if that happens, the confidence so prevalent the past few months will have been for naught unless one had the foresight to sell into the rally at some point.
Stocks continue to be highly valued, some say overbought. The last meaningful decline was in January of last year when the Dow and other indices took a hit somewhere between 12 and 15%. Though that particular correction never materialized into a bear market, it was a confidence-shaker and those who suffered losses are wont to forget it.
Taking a stab in the dark, it would appear that speculators are more interested in NASDAQ stocks, which continue to tear up new highs, just as the Dow is stalling. Could the NAZ pull the Dow along with it, or does the Dow hold the losing hand with which it will eventually pull down the composite, S&P, transports, et. al.?
With the Dow ending today roughly 150 points from the requisite top, it's still out there for the taking, though there seems to be no catalyst for any kind of extended move, so, reiterating past posts, even if the Dow makes the mark, it's doubtful it would hold for long. A correction is in the cards and it's likely to be swift rather than a slow grind, so day traders must keep stop losses close to the vest and hang on with all their fright. Yes, that's no typo. Fear and greed rule the markets and the fear index is on the rise.
At the Close 1.10.16:
Dow: 19,855.53, -31.85 (-0.16%)
NASDAQ: 5,551.82, +20.00 (0.36%)
S&P 500: 2,268.90, 0.00 (0.00%)
NYSE Composite: 11,183.33, +13.54 (0.12%)
Monday, January 9, 2017
Futures: Right Or Wrong Directional Trades; 12 Step Bloody Mary Redux
Stocks never had a chance on the first day of the first "full" week of trading (last week was only four days), dropping like rocks from a crumbling overpass at the open, only briefly showing any positive momentum and closing lower for the day, with the obvious exception of the wildly overpriced, speculative, and soon-to-crash NASDAQ.
The Dow refused to get even within earshot of 20,000, falling instead below 19,900 at the close, so the (so far) winning strategy of Fearless Rick remains intact. The peerless prognosticator called for "no Dow 20,000" by year-end 2016, and reiterates the same sentiment until June 2017, with a "may not" break over 20,000 until the year 2023.
It's a bold shot across the bow of the happy-happy, joy-joy "recovery" or the trumpeters of one Donald J. Trump, the president-elect who vows to "Make America Great Again." Not that Fearless Rick doubts the Donald; he backed his campaign from the start, predicting he would win the presidency as far back as December 31, 2016 (all the way at the end of the article), but the Trump years in the White House may be a calculated, "one step forward, two steps back," as radical policy shifts will cause some serious FUD (fear, uncertainty, doubt) and some liquidations that should have happened in 2008 or 2009 will occur under the Trump banner (see Sears, Mexico).
All of which brings up the point of futures and options, wherein one's ability to predict events beforehand is called into serious question. As a matter of fact, all investors are predisposed to make wagers on future events, whether they be into stocks, commodities or precious metals, because one would not "invest" in a company or anything without some idea that it would be worth more tomorrow or next month or next year than it is today.
Thus, investors fall into various camps, which, for matters better discussed elsewhere, are largely defined as "right until you're wrong" and "wrong until you're right."
The matter is simple, but real life examples provide the most descriptive narrative.
Take Fearless Rick's one-way bet on Dow 20,000. That's a case of being "right until you're wrong." So far, Rick is right and myriad derivative trades can be based upon his open principle, especially if one is to extend the time frame out to the ludicrous, or in this case, 2023.
Rick is also a precious metals speculator. In December he called for silver under $16 when it was trading in the range of $17 to $18. He was, early on, "wrong until he was right." The implications for investors - and one could take a lesson or two from the movie "The Big Short" for a glimpse at how extreme these future "wagers can become.
Speculation, prognostication and risk are not for everybody, especially those of feint heart. For the rest of us, it's a way of life.
At The Close 1/9/16:
Dow: 19,887.38, -76.42 (-0.38%)
NASDAQ: 5,531.82, +10.76 (0.19%)
S&P 500: 2,268.90, -8.08 (-0.35%)
NYSE Composite: 11,169.79, -67.83 (-0.60%)
And, just because it's the preferred weather for Bloody Mary's, Fearless Rick's 12-Step Bloody Mary™
1. Glass
2. Ice
3. Vodka
4. garlic pepper
5. hot sauce
6. ground black pepper
7. worcestershire sauce
8. celery seed
9. tomato juice
10. lime (or lemon) juice
11. horseradish
12. combine, stir and drink.
Apologies to alcoholics everywhere, from drunks around the world.
The Dow refused to get even within earshot of 20,000, falling instead below 19,900 at the close, so the (so far) winning strategy of Fearless Rick remains intact. The peerless prognosticator called for "no Dow 20,000" by year-end 2016, and reiterates the same sentiment until June 2017, with a "may not" break over 20,000 until the year 2023.
It's a bold shot across the bow of the happy-happy, joy-joy "recovery" or the trumpeters of one Donald J. Trump, the president-elect who vows to "Make America Great Again." Not that Fearless Rick doubts the Donald; he backed his campaign from the start, predicting he would win the presidency as far back as December 31, 2016 (all the way at the end of the article), but the Trump years in the White House may be a calculated, "one step forward, two steps back," as radical policy shifts will cause some serious FUD (fear, uncertainty, doubt) and some liquidations that should have happened in 2008 or 2009 will occur under the Trump banner (see Sears, Mexico).
All of which brings up the point of futures and options, wherein one's ability to predict events beforehand is called into serious question. As a matter of fact, all investors are predisposed to make wagers on future events, whether they be into stocks, commodities or precious metals, because one would not "invest" in a company or anything without some idea that it would be worth more tomorrow or next month or next year than it is today.
Thus, investors fall into various camps, which, for matters better discussed elsewhere, are largely defined as "right until you're wrong" and "wrong until you're right."
The matter is simple, but real life examples provide the most descriptive narrative.
Take Fearless Rick's one-way bet on Dow 20,000. That's a case of being "right until you're wrong." So far, Rick is right and myriad derivative trades can be based upon his open principle, especially if one is to extend the time frame out to the ludicrous, or in this case, 2023.
Rick is also a precious metals speculator. In December he called for silver under $16 when it was trading in the range of $17 to $18. He was, early on, "wrong until he was right." The implications for investors - and one could take a lesson or two from the movie "The Big Short" for a glimpse at how extreme these future "wagers can become.
Speculation, prognostication and risk are not for everybody, especially those of feint heart. For the rest of us, it's a way of life.
It seems to be a law of nature, inflexible and inexorable, that those who will not risk cannot win.--John Paul Jones
At The Close 1/9/16:
Dow: 19,887.38, -76.42 (-0.38%)
NASDAQ: 5,531.82, +10.76 (0.19%)
S&P 500: 2,268.90, -8.08 (-0.35%)
NYSE Composite: 11,169.79, -67.83 (-0.60%)
And, just because it's the preferred weather for Bloody Mary's, Fearless Rick's 12-Step Bloody Mary™
1. Glass
2. Ice
3. Vodka
4. garlic pepper
5. hot sauce
6. ground black pepper
7. worcestershire sauce
8. celery seed
9. tomato juice
10. lime (or lemon) juice
11. horseradish
12. combine, stir and drink.
Apologies to alcoholics everywhere, from drunks around the world.
Friday, January 6, 2017
The Dow 20,000 Ceiling
After the release of the non-farm payroll data for December, futures rose on the news that the nation created 156,000 net new jobs in the month, just shy of consensus estimates for 170,000. What may have been the cause for optimism was the 0.4% increase in wages carried in the report. The unemployment rate rose a notch to 4.7%, but that was at 8:30 am ET, an hour before the market open.
The bigger event began hours later as the Dow Jones Industrial Average - with the other major indices in tow - powered higher, eventually getting to within 0.37 points of the mystical, magic mark of Dow 20,000. The stall occurred at 19,999,63, the high for the day, right around noon.
For roughly the next four hours, the Dow tantalized and amused traders and spectators alike, hovering just below 20,000, reaching to within single points on various occasions.
But it never made it, as though somebody had placed a lid on the market right at the 20,000 mark. The index struggled and failed, over and over again throughout the afternoon, to no avail. Finally, with less than ten minutes remianing in the trading day, all the stops apparently run, the ghost was given up and the Dow closed not only short of 20,000 but also shy of a new record, at 19,963.80, a few ticks short of the all-time high close made on December 20 of last year, 19,974.62.
Explanations abound as to why the Dow cannot break through this hysterical, purely-psychological number, the best of them probably involving program trading, as computer algos have been set to sell as the number is approached. If that is the case, there's more than a few sharpies on Wall Street thinking that stocks are severely overvalued, or that even if Dow 20,000 is pierced, it will not hold.
Stocks are severely overvalued, boosted over the past eight years by cheap funding courtesy of the Federal Reserve, whose pockets are being emptied, replaced by promises to pay in the form of treasury and mortgage bonds, many of them losing value.
This was a close call for sure, but the 20,000 mark still stands triumphant over a market that continues to show weakness and an unwillingness to carry through to even higher figures.
With this in mind, the question to be answered over the weekend is, will it do it on Monday? Tuesday? Ever?
From all appearances, with markets stretched to the breaking point, it's not a very good bet, no matter how close it gets.
Thus, the first trading week of the new year ends in tears, though it was a profitable one for stocks with the notable exception of the NYSE Composite, which closed down for the day. Gains were made on all major indices, but perhaps people should be paying more attention to interest rates, which, after an initial surge in yield following last month's 25 basis point hike in the federal funds rate, have fallen hard. The 10-year note yielded 2.418%, but closed Thursday at 2.368%, the lowest yield in a month. While the apparent reversal from the Fed's induced yield above 2.50% is not set in concrete, it is surely something which bears close inspection. Spreads have narrowed since the rate hike, an ominous sign of rough times ahead. If stocks falter, the stampede into bonds will be overwhelming, but possibly the move has already begun in anticipation of a stock market correction or reversal into a bear market.
However, elite traders can pat themselves on the back as they head home for the weekend. So far, January 2017 is looking good for equities, despite the obvious failure at Dow 20,000.
At the Close 1.6.16:
Dow: 19,963.80, +64.51 (0.32%)
NASDAQ: 5,521.06, +33.12 (0.60%)
S&P 500: 2,276.98, +7.98 (0.35%)
NYSE Composite: 11,237.63, -10.06 (-0.09%)
For the Week:
Dow: +201.20 (1.02%)
NASDAQ: +137.94 (2.56%)
S&P 500: +38.15 (1.70%)
NYSE Composite: +180.73 (1.63%)
The bigger event began hours later as the Dow Jones Industrial Average - with the other major indices in tow - powered higher, eventually getting to within 0.37 points of the mystical, magic mark of Dow 20,000. The stall occurred at 19,999,63, the high for the day, right around noon.
For roughly the next four hours, the Dow tantalized and amused traders and spectators alike, hovering just below 20,000, reaching to within single points on various occasions.
But it never made it, as though somebody had placed a lid on the market right at the 20,000 mark. The index struggled and failed, over and over again throughout the afternoon, to no avail. Finally, with less than ten minutes remianing in the trading day, all the stops apparently run, the ghost was given up and the Dow closed not only short of 20,000 but also shy of a new record, at 19,963.80, a few ticks short of the all-time high close made on December 20 of last year, 19,974.62.
Explanations abound as to why the Dow cannot break through this hysterical, purely-psychological number, the best of them probably involving program trading, as computer algos have been set to sell as the number is approached. If that is the case, there's more than a few sharpies on Wall Street thinking that stocks are severely overvalued, or that even if Dow 20,000 is pierced, it will not hold.
Stocks are severely overvalued, boosted over the past eight years by cheap funding courtesy of the Federal Reserve, whose pockets are being emptied, replaced by promises to pay in the form of treasury and mortgage bonds, many of them losing value.
This was a close call for sure, but the 20,000 mark still stands triumphant over a market that continues to show weakness and an unwillingness to carry through to even higher figures.
With this in mind, the question to be answered over the weekend is, will it do it on Monday? Tuesday? Ever?
From all appearances, with markets stretched to the breaking point, it's not a very good bet, no matter how close it gets.
Thus, the first trading week of the new year ends in tears, though it was a profitable one for stocks with the notable exception of the NYSE Composite, which closed down for the day. Gains were made on all major indices, but perhaps people should be paying more attention to interest rates, which, after an initial surge in yield following last month's 25 basis point hike in the federal funds rate, have fallen hard. The 10-year note yielded 2.418%, but closed Thursday at 2.368%, the lowest yield in a month. While the apparent reversal from the Fed's induced yield above 2.50% is not set in concrete, it is surely something which bears close inspection. Spreads have narrowed since the rate hike, an ominous sign of rough times ahead. If stocks falter, the stampede into bonds will be overwhelming, but possibly the move has already begun in anticipation of a stock market correction or reversal into a bear market.
However, elite traders can pat themselves on the back as they head home for the weekend. So far, January 2017 is looking good for equities, despite the obvious failure at Dow 20,000.
At the Close 1.6.16:
Dow: 19,963.80, +64.51 (0.32%)
NASDAQ: 5,521.06, +33.12 (0.60%)
S&P 500: 2,276.98, +7.98 (0.35%)
NYSE Composite: 11,237.63, -10.06 (-0.09%)
For the Week:
Dow: +201.20 (1.02%)
NASDAQ: +137.94 (2.56%)
S&P 500: +38.15 (1.70%)
NYSE Composite: +180.73 (1.63%)
Thursday, January 5, 2017
With Non-Farm Payrolls Up Next, Dow Closes 100 Points Away From 20,000
Negative forces were at work on Thursday, keeping the Dow Jones Industrial Average below the magic 20,000 mark once again.
Prior to the market open was the ADP jobs report for December, which, in anticipation of Friday's non-farm payroll report, reported that the US added 153,000 jobs in the month, below consensus analyst estimates of roughly 170,000 jobs.
That, in addition to the ongoing turmoil in Chinese yuan was enough to start US markets off on a very tepid tone.
By late morning, the Dow had sunk to what would be the lows of the day, off by 113 points to 19,811, but the plunge was not significant and very short-lived.
Also weighing on stocks was the retail sector as Macy's and Kohl's both reported sluggish holiday sales after the bell on Wednesday. Macy's plans to close 68 stores nationwide and displace over 10,000 workers. Sears chimed in as well, announcing store closures and selling its iconic Craftsman brand to Stanley Black & Decker for $900 million.
Still flirting with the 20,000 level, the Dow stabilized close to the 19,900 level as continued optimism at the prospects of a Trump-inspired stimulus kept spirits somewhat still ebullient, though subdued.
Since mid-December, the Dow Jones Industrial Average has been hanging onto gains and closing just below historic highs, though signs are evident that the rally may not have much stream remaining. Those clinging to gains from the post-election surge may be gradually trimming their positions, as stocks seem to have stalled after Christmas.
What everyone believes but is loath to admit is that stocks are not fairly valued. They are expensive and a significant decline of five to ten percent might be just what's needed to resume the climb to new records. In other words, a short-lived sell-off might present a buying opportunity. On the other hand, market participants are fearful that any decline in equity values could unleash an uneasy and still-hibernating bear.
Tomorrow's non-farm payroll report for December should be enough of a catalyst in one way or another. The wait continues...
At the close 1.5.16:
Dow: 19,899.29, -42.87 (-0.21%)
NASDAQ: 5,487.94, +10.93 (0.20%)
S&P 500: 2,269.00, -1.75 (-0.08%)
NYSE Composite: 11,244.07, -2.47 (-0.02%)
Prior to the market open was the ADP jobs report for December, which, in anticipation of Friday's non-farm payroll report, reported that the US added 153,000 jobs in the month, below consensus analyst estimates of roughly 170,000 jobs.
That, in addition to the ongoing turmoil in Chinese yuan was enough to start US markets off on a very tepid tone.
By late morning, the Dow had sunk to what would be the lows of the day, off by 113 points to 19,811, but the plunge was not significant and very short-lived.
Also weighing on stocks was the retail sector as Macy's and Kohl's both reported sluggish holiday sales after the bell on Wednesday. Macy's plans to close 68 stores nationwide and displace over 10,000 workers. Sears chimed in as well, announcing store closures and selling its iconic Craftsman brand to Stanley Black & Decker for $900 million.
Still flirting with the 20,000 level, the Dow stabilized close to the 19,900 level as continued optimism at the prospects of a Trump-inspired stimulus kept spirits somewhat still ebullient, though subdued.
Since mid-December, the Dow Jones Industrial Average has been hanging onto gains and closing just below historic highs, though signs are evident that the rally may not have much stream remaining. Those clinging to gains from the post-election surge may be gradually trimming their positions, as stocks seem to have stalled after Christmas.
What everyone believes but is loath to admit is that stocks are not fairly valued. They are expensive and a significant decline of five to ten percent might be just what's needed to resume the climb to new records. In other words, a short-lived sell-off might present a buying opportunity. On the other hand, market participants are fearful that any decline in equity values could unleash an uneasy and still-hibernating bear.
Tomorrow's non-farm payroll report for December should be enough of a catalyst in one way or another. The wait continues...
At the close 1.5.16:
Dow: 19,899.29, -42.87 (-0.21%)
NASDAQ: 5,487.94, +10.93 (0.20%)
S&P 500: 2,269.00, -1.75 (-0.08%)
NYSE Composite: 11,244.07, -2.47 (-0.02%)
Wednesday, January 4, 2017
Stocks Edge Closer To Dow 20,000
Just the numbers at the close:
Dow: 19,942.16, +60.40 (0.30%)
NASDAQ: 5,477.00, +47.92 (0.88%)
S&P 500: 2,270.75, +12.92 (0.57%)
NYSE Composite: 11,246.55, +92.20 (0.83%)
Looks like tomorrow could finally be the day.
Dow: 19,942.16, +60.40 (0.30%)
NASDAQ: 5,477.00, +47.92 (0.88%)
S&P 500: 2,270.75, +12.92 (0.57%)
NYSE Composite: 11,246.55, +92.20 (0.83%)
Looks like tomorrow could finally be the day.
Tuesday, January 3, 2017
Stocks Up On First Trading Day Of Year, Signifying Nothing
Having - i some small ways - dispelled the concept that reaching for fantastic numbers such as Dow 20,000 is somehow productive, traders today took no heed of... well, anything, and pushed the DJIA close to the historic, albeit meaningless, mark.
That was early in the day. Shortly after the noon hour, the Dow had given up nearly all of the gains (all 160+ points) and was close to UNCH for the day. At the same time, the big run-up in WTI crude - to its highest level in 18 months (July 2015) - quickly was eviscerated, sending crude back below the break-even point for the day and into the red, where it closed on the NYMEX (53.49, -1.17).
However, the trading was not over on the stock exchanges and market participants seemed determined to open 2017 on a positive note, which they did, the major averages closing about 25% off their high points of the day.
Gains were well distributed, with nine of ten sectors positive, led by basic materials and energy. The only loser was utilities, though the loss was mild (-0.07%).
None of this one-day-one-off momentum-fest should be cause for alarm nor excitement. It's a new year, loaded with new ideas and fresh money and that money needs to go to work. While there are still impediments and potholes on the road to a brighter economic future and higher stock prices, none of that appeared to be of any consequence today.
Tomorrow may be another story with the very good possibility that the Dow will pierce the golden 20,000 mark and go well beyond. On the other hand, the evidence from the final two weeks of 2016 was robust in telling that the Trump rally from election day forward had run out of steam, so sideways could be the order of the day.
Money Daily was correct in predicting that Dow 20,000 would not be achieved in 2016. The second hypothesis was that it wouldn't reach that number until June of this year. Our third and most bombastic call was to say that Dow 20,000 may not be hit until 2023. Note the word MAY. We did not say the Dow would NOT reach 20,000 by that time, only that it MAY NOT. Big difference, but the call is based on a nascent understanding that everything in finance-land is not as rosy as the fake news media might have all of us believe.
The concept is very deep and rooted in a theory that the bulk of stock gains since the GFC of 2008 were achieved only though the means of depreciating and nearly decapitating currencies around the world. If money is cheaper today than it was yesterday, assets will accordingly be priced appropriately higher. Of course, should this free-money regime persist (we think it won't) then Dow 20,000 is not only achievable in the short run, Dow 30,000 would be in the kluge lights in short order, as would Apple at 250, and sirloin steaks at $24 a pound. In other words, inflation, then hyperinflation - such as is the case in Venezuela today - would make pricing irrelevant. Survival on $100,000 a year would be challenging and nobody is looking forward to that kind of nightmare scenario.
So, we see the gains of the last eight years as chimeras, and fading. And, if they fade, they will continue to fade until they are almost all gone. Not that a major, dramatic, collapse in prices would be a panacea for a better world, but only one which could be called closer to rational.
That's the view.
At the Close: 1.3.17:
Dow: 19,881.76, +119.16 (0.60%)
NASDAQ: 5,429.08, +45.97 (0.85%)
S&P 500: 2,257.83, +19.00 (0.85%)
NYSE Composite: 11,154.35, +97.46 (0.88%)
That was early in the day. Shortly after the noon hour, the Dow had given up nearly all of the gains (all 160+ points) and was close to UNCH for the day. At the same time, the big run-up in WTI crude - to its highest level in 18 months (July 2015) - quickly was eviscerated, sending crude back below the break-even point for the day and into the red, where it closed on the NYMEX (53.49, -1.17).
However, the trading was not over on the stock exchanges and market participants seemed determined to open 2017 on a positive note, which they did, the major averages closing about 25% off their high points of the day.
Gains were well distributed, with nine of ten sectors positive, led by basic materials and energy. The only loser was utilities, though the loss was mild (-0.07%).
None of this one-day-one-off momentum-fest should be cause for alarm nor excitement. It's a new year, loaded with new ideas and fresh money and that money needs to go to work. While there are still impediments and potholes on the road to a brighter economic future and higher stock prices, none of that appeared to be of any consequence today.
Tomorrow may be another story with the very good possibility that the Dow will pierce the golden 20,000 mark and go well beyond. On the other hand, the evidence from the final two weeks of 2016 was robust in telling that the Trump rally from election day forward had run out of steam, so sideways could be the order of the day.
Money Daily was correct in predicting that Dow 20,000 would not be achieved in 2016. The second hypothesis was that it wouldn't reach that number until June of this year. Our third and most bombastic call was to say that Dow 20,000 may not be hit until 2023. Note the word MAY. We did not say the Dow would NOT reach 20,000 by that time, only that it MAY NOT. Big difference, but the call is based on a nascent understanding that everything in finance-land is not as rosy as the fake news media might have all of us believe.
The concept is very deep and rooted in a theory that the bulk of stock gains since the GFC of 2008 were achieved only though the means of depreciating and nearly decapitating currencies around the world. If money is cheaper today than it was yesterday, assets will accordingly be priced appropriately higher. Of course, should this free-money regime persist (we think it won't) then Dow 20,000 is not only achievable in the short run, Dow 30,000 would be in the kluge lights in short order, as would Apple at 250, and sirloin steaks at $24 a pound. In other words, inflation, then hyperinflation - such as is the case in Venezuela today - would make pricing irrelevant. Survival on $100,000 a year would be challenging and nobody is looking forward to that kind of nightmare scenario.
So, we see the gains of the last eight years as chimeras, and fading. And, if they fade, they will continue to fade until they are almost all gone. Not that a major, dramatic, collapse in prices would be a panacea for a better world, but only one which could be called closer to rational.
That's the view.
At the Close: 1.3.17:
Dow: 19,881.76, +119.16 (0.60%)
NASDAQ: 5,429.08, +45.97 (0.85%)
S&P 500: 2,257.83, +19.00 (0.85%)
NYSE Composite: 11,154.35, +97.46 (0.88%)
Saturday, December 31, 2016
2016 Ends On Sour Tone As Stocks Sell Into Year-End Close
At the Close: 12/30/2016:
Dow: 19,762.60, -57.18 (-0.29%)
NASDAQ: 5,383.12, -48.97 (-0.90%)
S&P 500: 2,238.83, -10.43 (-0.46%)
NYSE Composite: 11,056.90, -17.43 (-0.16%)
Over the final three weeks of 2016, the financial community focused on not buying Christmas presents or planning a New Year's gala event, but boosting stocks to a point at which they could be sold for a tidy, late-year profit, and they did so by ramping up the Dow Jones Industrial Average to stratospheric levels before dumping the blue chip shares into the laps of terminally brain-dead bag holders, i.e., pension funds.
This maneuver was rather artfully crafted, with the financial media cheerleading the ascent to the magical "Dow 20,000" level, which, as most readers will note, is anything but magic. The figure is plainly something upon which ordinary people (pension fund managers) could focus their extremely short spans of attention. 20,000 points on the Dow can be compared to other nostalgic remnants of history, like 300 million Americans, 60 home runs, or five percent unemployment.
These are just numbers, and, while numbers themselves don't lie, when placed in a variety of contexts, the narratives blur the lines between fact and fantasy. To say that a certain level of unemployment is "maximum", or that another number is an historic record (and thus something to which others can aspire) reinforces the perceived value of such a figure. It does not change the fact that the number itself is innocuous, lonesome, and static.
Having control over vast swaths of money and capital, as do central bankers and their agents, allows considerable control over the flow. Stocks and commodities are easily controlled by such enormous hordes of cash and certificates; bonds and real estate less so. Thus it's no surprise that US stocks went into overdrive upon the election of Donald J. Trump as the 45th US president. This was after various implied warnings about a massive correction should the media star and real estate mogul win the election and was also on the heels of an enormous dumping in the futures market. Unwashed have limited insight, knowledge or memory of how large was the shift from futures to the US open on the day after the election and how well orchestrated was the late-stage rally from early November until just before Christmas.
From November 9 through December 13, the Dow added in excess of 1900 points (from 18,332.74 to 19,974.62), a gain of 1641 points, or, more than 8% in a period of less than seven weeks.
In other words, anybody who was right about Trump winning (not as out-of-the-question as the media had everybody believing) and wrong about the market outcome made a simple, inexcusable error of judgement. Those people trusted the same media narrative that was lying to them on both ends. As it turns out, Mr. Trump was a viable candidate capable of winning the election and the market was going to rally upon his victory, not drop into a sinkhole.
It was a great setup keyed by none other than everybody's favorite globalist central bankers and their agents at Goldman Sachs, the latter group eventually the recipient of more than just a few, token places inside the incoming Trump administration, but also the benefactor in a mammoth stock run which added significantly to the wealth of insiders at, or close to the center of the firm.
But Dow 20,000 was not to be. It was the cherry on top of the sundae meant for the little guy, but it was devoured by ravenous market forces otherwise known as naked short sellers, ostensibly, the large money crowd.
So, 2016 ends with a whimper rather than a shout. Delusional traders and hopeful investors will likely bear witness to more of the same chicanery in 2017. Nobody wants to admit that they're mere pawns on a global chessboard, therefore damming themselves behind a wall of self-doubt, misinformation, lies, and half-truths.
Happy New Year!
Week Ending 12/30/2016:
Dow: -171.21 (-0.86%)
NASDAQ: -79.57 (-1.46%)
S&P 500: -24.96 (-1.10%)
NYSE Composite: (-71.90, (-0.65%)
Dow: 19,762.60, -57.18 (-0.29%)
NASDAQ: 5,383.12, -48.97 (-0.90%)
S&P 500: 2,238.83, -10.43 (-0.46%)
NYSE Composite: 11,056.90, -17.43 (-0.16%)
Over the final three weeks of 2016, the financial community focused on not buying Christmas presents or planning a New Year's gala event, but boosting stocks to a point at which they could be sold for a tidy, late-year profit, and they did so by ramping up the Dow Jones Industrial Average to stratospheric levels before dumping the blue chip shares into the laps of terminally brain-dead bag holders, i.e., pension funds.
This maneuver was rather artfully crafted, with the financial media cheerleading the ascent to the magical "Dow 20,000" level, which, as most readers will note, is anything but magic. The figure is plainly something upon which ordinary people (pension fund managers) could focus their extremely short spans of attention. 20,000 points on the Dow can be compared to other nostalgic remnants of history, like 300 million Americans, 60 home runs, or five percent unemployment.
These are just numbers, and, while numbers themselves don't lie, when placed in a variety of contexts, the narratives blur the lines between fact and fantasy. To say that a certain level of unemployment is "maximum", or that another number is an historic record (and thus something to which others can aspire) reinforces the perceived value of such a figure. It does not change the fact that the number itself is innocuous, lonesome, and static.
Having control over vast swaths of money and capital, as do central bankers and their agents, allows considerable control over the flow. Stocks and commodities are easily controlled by such enormous hordes of cash and certificates; bonds and real estate less so. Thus it's no surprise that US stocks went into overdrive upon the election of Donald J. Trump as the 45th US president. This was after various implied warnings about a massive correction should the media star and real estate mogul win the election and was also on the heels of an enormous dumping in the futures market. Unwashed have limited insight, knowledge or memory of how large was the shift from futures to the US open on the day after the election and how well orchestrated was the late-stage rally from early November until just before Christmas.
From November 9 through December 13, the Dow added in excess of 1900 points (from 18,332.74 to 19,974.62), a gain of 1641 points, or, more than 8% in a period of less than seven weeks.
In other words, anybody who was right about Trump winning (not as out-of-the-question as the media had everybody believing) and wrong about the market outcome made a simple, inexcusable error of judgement. Those people trusted the same media narrative that was lying to them on both ends. As it turns out, Mr. Trump was a viable candidate capable of winning the election and the market was going to rally upon his victory, not drop into a sinkhole.
It was a great setup keyed by none other than everybody's favorite globalist central bankers and their agents at Goldman Sachs, the latter group eventually the recipient of more than just a few, token places inside the incoming Trump administration, but also the benefactor in a mammoth stock run which added significantly to the wealth of insiders at, or close to the center of the firm.
But Dow 20,000 was not to be. It was the cherry on top of the sundae meant for the little guy, but it was devoured by ravenous market forces otherwise known as naked short sellers, ostensibly, the large money crowd.
So, 2016 ends with a whimper rather than a shout. Delusional traders and hopeful investors will likely bear witness to more of the same chicanery in 2017. Nobody wants to admit that they're mere pawns on a global chessboard, therefore damming themselves behind a wall of self-doubt, misinformation, lies, and half-truths.
Happy New Year!
Week Ending 12/30/2016:
Dow: -171.21 (-0.86%)
NASDAQ: -79.57 (-1.46%)
S&P 500: -24.96 (-1.10%)
NYSE Composite: (-71.90, (-0.65%)
Thursday, December 29, 2016
Santa Claus Rally? Bah, Humbug; Dow Sheds 111 Points
After all the hoopla and expectations surrounding the magical "Dow 20,000" mark, it appears that some investors have made up their minds and are selling the rally, as any astute big hitter might.
While its fun to think that stocks will continue to reach ever higher and higher levels forever into the future - a reasonable strategy for those with a 20 or 30-year time horizon - it isn't exactly realistic to expect stocks that are already at historic levels to keep chasing higher.
The arguments in favor of a correction grow stronger with each passing month. The bearish position is bolstered by any number of factors, including:
Extreme valuations (stocks are trading well above the average P/E of 16)
Recent performance (prior to Wednesday's triple-digit decline, the Dow has gained nearly 2000 points (12%) since November 8)
Weak macro data including soft industrial production, capacity utilization, spotty data worldwide)
Strong dollar (normally bad for US exporters and thus, many US stocks)
Recent hike in the fed funds rate and the potential for continuing interest rate gains making bonds more attractive as an alternative to stocks
Zero to negative income growth for the majority of the population
Record stock buybacks reducing participation and making a mockery of EPS
Market timing vis-a-vis capital gains taxes (January is usually be a great time to book gains)
Chasing stocks at this juncture is a fool's errand, as it would amount to the inverse of the "buy low, sell high" adage that has guided even novice investors for eons.
There are more than a few out there reading the tea leaves for what they are rather than what they appear to be.
At the Close, Friday, December 28, 2016:
Dow: 19,833.68, -111.36 (-0.56%)
NASDAQ: 5,438.56, -48.89 (-0.89%)
S&P 500: 2,249.92, -18.96 (-0.84%)
NYSE Composite: 11,058.88, -87.52 (-0.79%)
While its fun to think that stocks will continue to reach ever higher and higher levels forever into the future - a reasonable strategy for those with a 20 or 30-year time horizon - it isn't exactly realistic to expect stocks that are already at historic levels to keep chasing higher.
The arguments in favor of a correction grow stronger with each passing month. The bearish position is bolstered by any number of factors, including:
Extreme valuations (stocks are trading well above the average P/E of 16)
Recent performance (prior to Wednesday's triple-digit decline, the Dow has gained nearly 2000 points (12%) since November 8)
Weak macro data including soft industrial production, capacity utilization, spotty data worldwide)
Strong dollar (normally bad for US exporters and thus, many US stocks)
Recent hike in the fed funds rate and the potential for continuing interest rate gains making bonds more attractive as an alternative to stocks
Zero to negative income growth for the majority of the population
Record stock buybacks reducing participation and making a mockery of EPS
Market timing vis-a-vis capital gains taxes (January is usually be a great time to book gains)
Chasing stocks at this juncture is a fool's errand, as it would amount to the inverse of the "buy low, sell high" adage that has guided even novice investors for eons.
There are more than a few out there reading the tea leaves for what they are rather than what they appear to be.
At the Close, Friday, December 28, 2016:
Dow: 19,833.68, -111.36 (-0.56%)
NASDAQ: 5,438.56, -48.89 (-0.89%)
S&P 500: 2,249.92, -18.96 (-0.84%)
NYSE Composite: 11,058.88, -87.52 (-0.79%)
Saturday, December 24, 2016
Nine Days And Counting: Dow Fails To Surpass 20,000; Luck Matters
Nine trading days have come and gone since the Dow surpassed the 19,900 mark with expectations that Dow 20,000 would soon be a number we'd be looking at in collected rear view mirrors. It was also the day before the FOMC of the Fed issued their well-telegraphed, monumental 25 basis point increase to the federal funds rate (AKA, the Go F Yourself rate for savers), a marketing stroke of genius by the self-appointed rulers of all marketplaces, everywhere, forever.
Well, what happened?
In technical terms, the Fed put the kibosh on stocks. 20,000 didn't happen, just like other sure things this year, such as Hillary Clinton winning the election to become America's 45th president (love that one, just can't give it up).
Other things didn't happen over the past nine trading days (plus one weekend) that were not nearly as important. Donald Trump didn't resign before taking the oath of office (sorry to the serially constipated never-Trumpers like Bill Kristol), nobody killed any special lions or panda bears, and no enormous meteors struck the earth ending the human species (really happy about that last one).
But, a few days ago (Wednesday, Dec. 21), Fearless Rick made possibly the most outrageous prediction of his inglorious career as writer, journalist, blogger and general miscreant. He touted his belief that the Dow would not break the 20,000 mark this year or at least until June, 2017. He mused that the Dow "may" not hit 20,000 until 2023.
Here's his exact quote:
So far he's right. But there's still five trading days left in 2016, so plenty of people are rooting against him, including some fat guy in a weird red suit promising some absurd thing known as a Santa Claus Rally. Good luck with that. Far fewer are betting against him, however, as the market in general, and the Dow in particular, seems to have peaked.
There's still plenty of time for him to be wrong. There's the six months until June, and the seven years until 2023. But, since one and seven are Fearless Rick's lucky numbers, he may eventually to be more lucky than good.
We shall see. In case one missed all the non-action of Friday's market churning, it went something like this: Down, slightly, sleepwalking though midday, rabid short-covering into the closing last ten minutes, boosting all the major indices into positive territory. We have all seen this play before. Yawn, and Merry Christmas.
At the Close, Friday, December 23, 2016:
Dow: 19,933.81, +14.93 (0.07%)
NASDAQ: 5,462.69, +15.27 (0.28%)
S&P 500: 2,263.79, +2.83 (0.13%)
NYSE Composite: 11,128.80, +14.66 (0.13%)
For the week:
Dow: +90.40 (+0.46%)
NASDAQ: +25.53 (+0.47%)
S&P 500: +5.72 (+0.25%)
NYSE Composite: +3.58 (+0.03%)
Well, what happened?
In technical terms, the Fed put the kibosh on stocks. 20,000 didn't happen, just like other sure things this year, such as Hillary Clinton winning the election to become America's 45th president (love that one, just can't give it up).
Other things didn't happen over the past nine trading days (plus one weekend) that were not nearly as important. Donald Trump didn't resign before taking the oath of office (sorry to the serially constipated never-Trumpers like Bill Kristol), nobody killed any special lions or panda bears, and no enormous meteors struck the earth ending the human species (really happy about that last one).
But, a few days ago (Wednesday, Dec. 21), Fearless Rick made possibly the most outrageous prediction of his inglorious career as writer, journalist, blogger and general miscreant. He touted his belief that the Dow would not break the 20,000 mark this year or at least until June, 2017. He mused that the Dow "may" not hit 20,000 until 2023.
Here's his exact quote:
The Dow isn't going to make it to 20,000 this year, and it won't make it by June of next year. In fact, it may not hit 20,000 until 2023. Book it.
So far he's right. But there's still five trading days left in 2016, so plenty of people are rooting against him, including some fat guy in a weird red suit promising some absurd thing known as a Santa Claus Rally. Good luck with that. Far fewer are betting against him, however, as the market in general, and the Dow in particular, seems to have peaked.
There's still plenty of time for him to be wrong. There's the six months until June, and the seven years until 2023. But, since one and seven are Fearless Rick's lucky numbers, he may eventually to be more lucky than good.
We shall see. In case one missed all the non-action of Friday's market churning, it went something like this: Down, slightly, sleepwalking though midday, rabid short-covering into the closing last ten minutes, boosting all the major indices into positive territory. We have all seen this play before. Yawn, and Merry Christmas.
At the Close, Friday, December 23, 2016:
Dow: 19,933.81, +14.93 (0.07%)
NASDAQ: 5,462.69, +15.27 (0.28%)
S&P 500: 2,263.79, +2.83 (0.13%)
NYSE Composite: 11,128.80, +14.66 (0.13%)
For the week:
Dow: +90.40 (+0.46%)
NASDAQ: +25.53 (+0.47%)
S&P 500: +5.72 (+0.25%)
NYSE Composite: +3.58 (+0.03%)
Thursday, December 22, 2016
Dow Misses Another Opportunity To Surpass 20,000; Rally May Not Have Legs
Now that the flirtation with 20,000 on the Dow is waning, perhaps the market and its participants will return to some semblance of regular trading as opposed to the mad year-end dash for cash following the election.
While financial pundits are still calling the recent burst higher the "Trump Rally," it probably has little or no relevance to the election of the real estate magnate as the 45th president of the United States. What it has to do with is window dressing for fund managers, loading up on hot stocks to adorn their year-end portfolio prospectuses.
Less realistic is the opportunity for the rally to continue, especially after the major league run-up and two straight days of losses on the main indices. Though not large, today's declines were in a very slight range, but interestingly, stocks fell behind the unchanged line at the open and stayed there throughout the session, indicative of a tired market, though perhaps Friday will provide some news and another boost for the Dow 20,000 hat crowd.
Even that possibility seems remote, as the quad witching expiry was last week and the closeout to this week will be more reminiscent of a dash out the door than a frenzied trading day. It is, after all, just one day prior to Christmas Eve, and, despite rumors to the contrary, even Wall Street traders are human.
There's also scant data coming forward and just about everything but kitchen sink futures have been priced in for the final week of 2016. Anybody seeking profits at this juncture has truly missed that boat.
So, Friday is going to be dull and the cries of "Dow 20,000" are not to be heard around these parts for a while. Taking a little off the top going into the new year isn't exactly a bad idea, and it seems to be catching on with more than a few.
There still is time for the annual Santa Claus rally, traditionally the final week of the year, but the Trump rally may have grounded old St. Nick. We'll find out next week.
At the Close 12/22/16:
Dow: 19,918.88, -23.08 (-0.12%)
NASDAQ: 5,447.42, -24.01 (-0.44%)
S&P 500: 2,260.96, -4.22 (-0.19%)
NYSE Composite: 11,113.04, -29.52 (-0.26%)
While financial pundits are still calling the recent burst higher the "Trump Rally," it probably has little or no relevance to the election of the real estate magnate as the 45th president of the United States. What it has to do with is window dressing for fund managers, loading up on hot stocks to adorn their year-end portfolio prospectuses.
Less realistic is the opportunity for the rally to continue, especially after the major league run-up and two straight days of losses on the main indices. Though not large, today's declines were in a very slight range, but interestingly, stocks fell behind the unchanged line at the open and stayed there throughout the session, indicative of a tired market, though perhaps Friday will provide some news and another boost for the Dow 20,000 hat crowd.
Even that possibility seems remote, as the quad witching expiry was last week and the closeout to this week will be more reminiscent of a dash out the door than a frenzied trading day. It is, after all, just one day prior to Christmas Eve, and, despite rumors to the contrary, even Wall Street traders are human.
There's also scant data coming forward and just about everything but kitchen sink futures have been priced in for the final week of 2016. Anybody seeking profits at this juncture has truly missed that boat.
So, Friday is going to be dull and the cries of "Dow 20,000" are not to be heard around these parts for a while. Taking a little off the top going into the new year isn't exactly a bad idea, and it seems to be catching on with more than a few.
There still is time for the annual Santa Claus rally, traditionally the final week of the year, but the Trump rally may have grounded old St. Nick. We'll find out next week.
At the Close 12/22/16:
Dow: 19,918.88, -23.08 (-0.12%)
NASDAQ: 5,447.42, -24.01 (-0.44%)
S&P 500: 2,260.96, -4.22 (-0.19%)
NYSE Composite: 11,113.04, -29.52 (-0.26%)
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