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The Inherent Problem Of Eternal Bullishness
by Lance Roberts of Streettalk Live,
This past weekend, Akin Oyedele penned an article via Business Insider entitled "I went to a seminar with one of the world's largest banks and almost everything said there was really bearish." Akin seems genuinely shocked the data suggests economic growth may not be on the cusp of surging and stocks might fail to deliver double-digit returns.
However, since I was long ago excised by the media for allowing the "data to speak," let me clarify, for both you and Akin, why HSBC is likely correct in their analysis.
4 Warnings And Why You Should Pay Attention
by Lance Roberts of Streettalk Live,
When I was growing up my father, probably much like yours, had pearls of wisdom that he would drop along the way. It wasn't until much later in life that I learned that such knowledge did not come from books, but through experience.
Technically Speaking: The Real Correction Is Still Coming
by Lance Roberts of Streettalk Live,
In last week's update, I discussed the short-term oversold condition that existed at that time. To wit:
"As you will notice, the reflexive rally, and subsequent failure, have tracked the original predictions very closely up to the point. With the market once again very oversold on a short-term basis, it is likely that the markets could manage a weak rally attempt over the next few days."
The 80/20 Rule Is Crushing The Economy
by Lance Roberts of Streettalk Live,
In business, the 80/20 rule states that 80% of your business will come from 20% of your customers. In an economy that is more than 2/3rds driven by consumption, such an imbalance of the "have" and "have not's" impedes real economic growth.
Technically Speaking: DeJa Vu All Over Again
by Lance Roberts of Streettalk Live,
In yesterday's missive "It All Comes Down To This," I discussed the upcoming Federal Reserve meeting and the expectation that the Fed once again delays hiking rates due to global economic and market weakness.
With markets oversold on a short-term basis combined with a spike in volatility and bearish sentiment, a "punt" by the FOMC will likely spark a short-term rally in the market. Such an outcome would NOT be surprising by any means since the market has rallied the week of an FOMC "no hike" meeting since 2013.
Technically Speaking: A Sucker's Rally?
by Lance Roberts of Streettalk Live,
In last week's technical review "The Mark Of A Bear," I stated:
"The Bulls have remained firmly in charge of the markets as the reach for returns exceeded the grasp of the underlying risk. It now seems that has changed. For the first time since 2007, as we see initial markings of a potential bear market cycle."
The problem in stating that we MAY be seeing the initial markings of a potential bear market cycle is that individuals assume this means the markets will crash immediately. When such an outcome does not occur, the analysis is presumed wrong.
Why This Time Could Be Different
by Lance Roberts of Streettalk Live,
In yesterday's post, I discussed the current correction within the context of previous "bull market" corrections. Specifically, the corrections in 1987, 1998, 2010 and 2011.
However, today, I want to look at the current correction in the context of previous starts to "bear markets" and subsequent recessions.
All Bubbles Are Different
by Lance Roberts of Streettalk Live,
If stock market bubbles are driven by speculation, greed, and emotional biases – the valuations and fundamentals are simply a reflection of those emotions.
In other words, bubbles can exist even at times when valuations and fundamentals might argue otherwise.
3 Things: Freight, Deflation, No Hike
by Lance Roberts of Streettalk Live,
We often look at broad measures of the economy to determine its current state. However, we can often receive clues about where the economy may be headed by looking at data that feeds into the broader measures. Exports, imports, wage growth, commodity prices, etc. all have very important ties to the health of the consumer which is critical to an economy that is nearly 70% driven by their consumption.
When Will We Ever Learn?
by Lance Roberts of Streettalk Live,
Life is full of irony. When I was in school, I hated history. It was boring. It was pointless. How was reading about a bunch of dead people ever going to be useful in life? Today, I consume everything I can find on history. Particularly, financial history. Ironic.
Who's Right - Commodities Or Fed?
by Lance Roberts of Streettalk Live,
I have been suggesting for quite some time that the Federal Reserve is stuck in a "liquidity trap" which makes it very difficult for monetary policy to be effective. More importantly, beginning in January of this year, I have suggested that the Fed is being forced to choose between the "lesser of two evils."
Predicting The Future Is Difficult
by Lance Roberts of Streettalk Live,
Predictions of the future are indeed very difficult, and yet individuals are challenged every day with doing precisely that. For traders, it is what the market, or a particular investment, will do in the next few minutes to days. For longer-term investors, those predictions move out to months or years.
"Debt Gone Wild" - Debt Funded Stock Buybacks Soar
by Lance Roberts of Streettalk Live,
I penned an article recently discussing the many measures that corporations have used in recent years to "beat" Wall Street estimates. Of course, the beating of Wall Street estimates, so adamantly adored by mainstream media, always ignores the fact that estimates are continually reduced so that companies to "beat" them. This is the equivalent of moving the "target to the arrow."
The Earnings Season "Scandal"
by Lance Roberts of Streettalk Live,
Just like the hit series "Scandal" in which a political "fixer" delves into the manipulation, deceit and obfuscation that prevails in the dark corners of Washington, D.C., so to has Wall Street's earnings. From time to time, I analyze the previous quarters earnings for the S&P 500 to reveal the "quality" of earnings rather than the "quantity" as focused on by Wall Street. One of the most interesting data points continues to the be the extremely low level of "top line" revenue growth as compared to an explosion of the bottom line earnings per share.
Recession Check: Updating The Indicators
by Lance Roberts of Streettalk Live,
In December of 2007, I wrote in my weekly newsletter that we were "...either in, or about to be in, the worst recession since the 'Great Depression.'"
At that time, the warning rang hollow as GDP growth was positive, and the markets were still marching higher as the calendar turned to 2008. It was a year later, in December of 2008, that the National Bureau of Economic Research (NBER), stated that the recession did, in fact, begin in December of 2007.
OMG: Putting Jump In Interest Rates Into Perspective
by Lance Roberts of Streettalk Live,
During my daily radio broadcast yesterday, I received a rather "panicked" call regarding the "dramatic plunge" in his bond funds due to the recent jump in interest rates. Of course, he is not alone. Over the last few weeks the media has done its normal headline-grabbing spin by dragging out every bond "bear" they can find to discuss why this time, unlike like the last 30 times, is definitely the end of the "great bond bull market."
The Dangerfield Recovery Or A Skousen Reality
by Lance Roberts of Streettalk Live,
During my morning reading I ran across this article by my friend Cullen Roche, via Pragmatic Capitalist, entitled "The Economic Recovery That Can't Get Any Respect," or more commonly known as the "Dangerfield Recovery."
The Mistake Eveyone Is Making About Fed Rate Hikes
by Lance Roberts of Streettalk Live,
With the Federal Reserve now indicating that they are "really serious" about raising interest rates, there have come numerous articles and analysis discussing the impact on asset prices. The general thesis is based on averages of historical tendencies as discussed recently by David Rosenberg in his daily commentary.
The Real Financial Crisis That Is Looming
by Lance Roberts of Streettalk Live,
There is a financial crisis on the horizon. It is a crisis that all the Central Bank interventions in the world cannot cure. It is a financial crisis that will continue to change the economic landscape of America for decades to come.
BofA Is Confusing Liquidity Fueled And Secular Bull Markets
by Lance Roberts of Streettalk Live,
Over the past couple of years, there has been a growing chorus of individuals claiming that the financial markets have finally shaken the shackles of the secular bear market that began at the turn of the century. This, of course, suggests that the markets have now begun the next long-term secular bull market.
Dalbar: Why Investors Suck And Tips For Advisors
by Lance Roberts of Streettalk Live,
Dalbar just recently released their 21st annual Quantitative Analysis Of Investor Behavior study which continues to show just how poorly investors perform relative to market benchmarks over time and the reasons for that underperformance.
10 Investment Quotes To Live By
by Lance Roberts of Streettalk Live,
As markets hover near all-time highs, investors have become quite complacent that the current bull market trend will continue indefinitely. But why shouldn't they? After all, the Central Banks of the world have made it a primary mission to ensure that asset prices don't fall in order to keep extremely weak economies limping along.
Meet the world’s worst economic forecasters – The Fed
by Lance Roberts of Streettalk Live,
I have been tracking the Federal Reserves forward looking projections ever since they begin releasing their forecasts. The purpose of tracking these projections was to compare the Fed's forecasts with what eventually became reality. The record is now clear...they are the worst economic forecasters...ever.
Markets Vs Economy - The Great Disconnect
by Lance Roberts of Streettalk Live,
Last week, the markets hit new "all-time" highs as Greece caved into the demands of the Eurozone, at least for now, in order to secure funding for another four months. The relief that the latest Eurozone crisis has been resolved sent money flowing into equity markets as investors remain "afraid to miss out" on rising asset prices. The general consensus of analysts and economists is that the rise in capital markets is clearly a sign of economic strength which makes equities the "only game in town" as long as Central Banks stand at the fore.
The Daily X-Change - 3 Things - Uncomfortable Facts, 25-54 Employment, Houston RE
by Lance Roberts of Streettalk Live,
While the media and mainstream analysts discount the negative economic impact of falling energy costs, I have personally witnessed it in the mid-80's, the late 90's and just prior to 2008. In all cases, the negative outcomes were far worse than predicted which left economists scratching their heads as to what went wrong with their models. Of course, considering the BLS only saw a loss of 1900 manufacturing (oil and gas) jobs in January when there were 26,000 layoffs may explain part of the problem.
Questions Remain After Blowout Employment Report
by Lance Roberts of Streettalk Live,
I like to think of myself as a pretty simple guy. I don't like complexity or complications, but most importantly I like things to make sense. The latest employment report, which showed a surge in employment in recent months, left me with more questions than answers.
Questions Remain After Blowout Employment Report
by Lance Roberts of Streettalk Live,
I like to think of myself as a pretty simple guy. I don't like complexity or complications, but most importantly I like things to make sense. The latest employment report, which showed a surge in employment in recent months, left me with more questions than answers.
The Long View: Is The Bull Market In Bonds Almost Over?
by Lance Roberts of Streettalk Live,
There has been much debate about the current low levels of interest rates in the economy today. The primary argument is that the "30-year bull market in bonds", due to consistently falling interest rates, must be near its end. Of course, this debate has devastated the "bond bears" who have consistently been frustrated by lower interest rates despite their annual predictions to the contrary. However, just because interest rates are currently low, does this necessarily mean that they must rise?
3 Things - Fed Mistake, ECB QE, Housing
by Lance Roberts of Streettalk Live,
On Wednesday, the Federal Reserve made their latest monetary policy announcement. Janet Yellen, the current Chairwoman, made several statements that led the markets to believe that they remain on course for increasing the overnight lending rate this year.
3 Things - The Fed, Rig Counts And Employment, ECB
by Lance Roberts of Streettalk Live,
Yesterday, I wrote a fairly lengthy discussion on the biggest fear of the Fed is deflation. As I stated: "The biggest worry of the Federal Reserve, and frankly every Central Banker on the planet, is deflation. The reason is that deflation, as an economic pressure, is dangerous and once entrenched becomes difficult to break."
Deflation Is A Problem For The Fed
by Lance Roberts of Streettalk Live,
The biggest worry of the Federal Reserve, and frankly every Central Banker on the planet, is deflation. The reason is that deflation, as an economic pressure, is dangerous and once entrenched becomes difficult to break. For the Fed, the fear of inflation is far less worrisome.
3 Things - Employment, Interest Rates & Retail Sales
by Lance Roberts of Streettalk Live,
There has been much discussion as of late about the "longest string of employment gains since the 90's." There is certainly no argument that employment has improved since the financial crisis, however, with the economy six years into a recovery we should certainly expect as much.
5 Charts For Fully Invested Bears
by Lance Roberts of Streettalk Live,
While the mainstream media continues to misalign individuals expectations by chastising them for "not beating the market," which is actually impossible to do, the job of a portfolio manager is to participate in the markets with a predilection toward capital preservation. It is the destruction of capital during market declines that have the greatest impact on long-term portfolio performance.
Five Things To Ponder: What This Way Cometh
by Lance Roberts of Streettalk Live,
This week's reading list is a smattering of reads about 2015. As a contrarian investor by nature, it was interesting to note how hard it was to find views that were NOT bullishly biased. It seems we may have now entered a market realm where Unicorns and Bears are only things of legend.
3 Things - Volatility, The Fed and Yield Spreads
by Lance Roberts of Streettalk Live,
Since the end of the Federal Reserve's latest QE program, market volatility has picked up markedly. Since October, as QE came to its final bond buying conclusion, the drain of liquidity begin to financial market activity. As shown in the chart below, there have been three fairly sizable selloffs last quarter of 7.9%, 5.0%, and 4.3%.
Results 801–850
of 895 found.
