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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%.
As We Enter 2015, "Bulls" Should Consider
by Lance Roberts of Streettalk Live,
As we enter into 2015, analyst calls for a continued "bull market" advance have never been louder. There have been a litany of articles written recently discussing how the stock market is set for a continued bull rally. The are some primary points that are common threads among each of these articles.
Falling Energy Costs And Economic Impacts
by Lance Roberts of Streettalk Live,
In the financial markets and economics it is a common occurrence that the media and commentators will latch on to a statement that supports a cognitive bias and then repeat that statement until it is a universally accepted truth.
2015 - What Does Cycle Analysis Suggest
by Lance Roberts of Streettalk Live,
We cant predict the future if it were possible fortune tellers would all win the lottery. They dont, we cant and we arent going to try to. However, we can analyze what has happened in the past, weed through the noise of the present and try to discern the possible outcomes of the future.
5 Things To Ponder: Crude Oppositeness
by Lance Roberts of Streettalk Live,
This past week I have been inundated with questions regarding the dive in crude oil prices and the energy sector in general. Is this a fantastic buying opportunity, or is the bigger of something bigger? The answer depends on your time frame.
5 Things To Ponder: Crude Oppositeness
by Lance Roberts of Streettalk Live,
This past week I have been inundated with questions regarding the dive in crude oil prices and the energy sector in general. Is this a fantastic buying opportunity, or is the bigger of something bigger? The answer depends on your time frame.
10 Legendary Investment Rules From Legendary Investors
by Lance Roberts of Streettalk Live,
I live in Houston, which has been a huge economic beneficiary of the sustained increases in oil prices, drilling, refining and related processes. As such, the amount of wealth created in energy-related investments has been enormous and, not surprisingly, a vast majority of individuals have overweighted portfolios in energy with the expectations that "oil prices can only go up."
Interest Rates Have Nowhere To Go But Up?
by Lance Roberts of Streettalk Live,
Earlier this week Daniel Druger and Liz McCormick wrote an article for Bloomberg entitled: "One Hundred Years Of Bond History Means Bears Destined To Lose." The premise here is simple. With interest rates near their lowest levels on record, they have nowhere to go from here "but up." This is the consensus of virtually all of the analysts and economists on Wall Street which currently suggests that rates will rise to 3.88% next year on the 30-year treasury.
Five Things To Ponder: Unstoppable Force Paradox
by Lance Roberts of Streettalk Live,
As we enter the final month of the year, the markets advance got me thinking about something known as the "Unstoppable Force Paradox." While you may not be familiar with the name, you will certainly know the definition which questions "What happens when an unstoppable force meets an immovable object?"
The Illusion Of Full Employment And Technology
by Lance Roberts of Streettalk Live,
Recently, Tim Duy wrote an interesting piece entitled "Yes, I am Optimistic" wherein he stated that: "The lesson no one wants to draw from this recovery is that the US economy is both stronger and more resilient than commonly believed. Do not dismiss the real improvement in the economy since 2009. It is not unimportant that 2014 is likely to be the biggest year for private sector employment..."
Five Things To Ponder: Tryptophan Induced Coma
by Lance Roberts of Streettalk Live,
As we prepare for the annual food fest, and post-Thanksgiving tryptophan-induced food coma; I thought this weekend's reading list should be a bit of a smorgasbord of interesting topics to stimulate your brain cells between naps and football.
3 Things to Think About, Including the Disconnect between Data And Surveys
by Lance Roberts of Streettalk Live,
Last Friday, I discussed the growing gap between economic reports particularly when they measure the same basic areas of the overall economy. For example, how can the Markit Manufacturing PMI Index be negative for three months while the ISM PMI has surged higher during the same period. Both cannot be right.
3 Things Worth Thinking About, Including the Message from Commodities
by Lance Roberts of Streettalk Live,
Following the October swoon, stocks have vaulted to all-time highs. As I discussed previously in "Sentiment Is Off The Charts Bullish," there have only been few occasions where investors have felt so "giddy" about the financial markets. Such periods of exuberance have never ended well for investors as they were deluded by near-term "greed" which blinded them to the building risks.
Mean-Reverting Profits and Other Things Worth Thinking About
by Lance Roberts of Streettalk Live,
Earlier this week I discussed the growing detachment between the stock market and the "real" underlying economy. One of the areas I touched on was corporate earnings that have been elevated by an immense amount of accounting gimmackry, cost cutting, and productivity increases. The problem, as I stated, is that historically earnings have grown 6% peak-to-peak before a reversion. Notice, I said peak-to-peak. The issue is that the majority of analysts now estimate that earnings will rise unabated for the next five years.
Early Freeze Could Derail Economic Growth Forecasts
by Lance Roberts of Streettalk Live,
This past August I discussed the potential for the market to rise to 2100 along with "5-risks" to that forecast. One of those risks related to the "Polar Vortex" that shut down economic activity across much of the northern part of the economy.
5 Things To Ponder: GOP Takes Control
by Lance Roberts of Streettalk Live,
This past Tuesday the conservative Republican candidates garnered a resounding victory over their Democratic challengers in even some of the "bluest" states. The message that was sent by voters was quite clear: "The real economy sucks."
3 Things Worth Thinking About, Including the Odds of a Suckers Rally
by Lance Roberts of Streettalk Live,
Each week in my weekly newsletter I do a complete overview on major markets, sectors and other market areas such as interest rates, gold and oil. I bring this up because the recent melt-down in oil and energy related stocks is something that I warned about in early August of this year.
Why The Fed Will End QE On Wednesday
by Lance Roberts of Streettalk Live,
This week we will find out the answer to whether the Federal Reserve will end its current quantitative easing program or not. Today is the last open market operation of the current program, and my bet is that it will be the last, for now. Here are my three reasons why I believe this to be the case.
5 Things To Ponder: To QE Or Not To QE
by Lance Roberts of Streettalk Live,
Over the last few weeks, the markets have seen wild vacillations as stocks plunged and then surged on a massive short-squeeze in the most beaten up sectors of energy and small-mid capitalization companies. While "Ebola" fears filled mainstream headlines the other driver behind the sell-off, and then marked recovery, was a variety of rhetoric surrounding the last vestiges of the current quantitative easing program by the Fed. As I have shown many times in the past, there is a high degree of correlation between the Fed's liquidity programs and the advance in the markets.
3 Things Worth Thinking About: Inflation, the Current Rally and Faith in the Fed
by Lance Roberts of Streettalk Live,
What is quickly being realized on a global basis is that injecting the system with liquidity that flows into asset prices, does not create organic economic demand. Both Japan and the Eurozone's interventions have failed to spark inflationary pressures as the massive debt burden's carried by these countries continues to sap the ability to stimulate real growth.
5 Things To Ponder: "Buy" or "Run"
This past week investors to a blow from a sharp selloff in the financial markets. I have spilled quite a bit of ink in recent months discussing the probabilities of such as corrective event as the Federal Reserves current liquidity operation came to a conclusion this month.
Inconceivable
by Lance Roberts of Streettalk Live,
The point is that there are many risks investors should not ignore. Making up losses is much harder than reinvesting stored capital once a clearer picture emerges. While the current belief that a correction of magnitude in the markets is "inconceivable," I am not sure that word means what they think it means.
Five Things To Ponder: Through The Looking Glass
by Lance Roberts of Streettalk Live,
Is this the beginning of a bigger correction, or just a respite before the next advance? This is the first correction, since the beginning of the Federal Reserves latest round of quantitative easing, where the market has broken decisively through its shorter term moving average as shown below.
Why Do Investors Really Underperform Over Time?
by Lance Roberts of Streettalk Live,
There have been numerous articles written as of late that have chastised individuals for "missing out on the bull market" which was only slightly worse than "not beating it." The reasons were chalked up to bad investment advice and paying "too much" in fees which caused the underperformance. While both of those reasons may be contributors to the problem, they are in reality on very small components of the problem when compared to the three single largest contributors to investor underperformance over time.
The Statistical Recovery Continues
by Lance Roberts of Streettalk Live,
This past Friday, investors awoke to news that, according to the U.S. Labor Department, employers added 248,000 jobs last month. In addition, job numbers for previous months were revised upward, and the jobless rate fell to 5.9% from August's 6.1%. These numbers had the mainstream media cheering that "economic victory" was nigh and stocks were propelled upward.
5 Things To Ponder: Motley Cognizance
by Lance Roberts of Streettalk Live,
It has been an interesting week in the financial markets as the current correction process has continued. As shown in the chart below, the correction has primarily occurred in the mid, small and international equities as money has rotated into mega-large cap stocks for safety.
Correction Awakens Sleeping Bears, Plunging Oil and Dollar Spikes
Since the end of 2012, the S&P 500 has been on an inexhaustible rise despite rising geopolitical tensions, extremely cold weather and weak economic data. The driver, of course, has been the massive liquidity inflows from the Federal Reserve that have catapulted the markets from their previous upward bullish trend into an accelerated push. This is shown in the chart below.
No Recession Now - But When?
by Lance Roberts of Streettalk Live,
There have been a few calls as of late (Hussman, ECRI, Shilling) stating that we are currently in the next recession. Then there is everyone else. While the "optimistic" outlook is always more enjoyable to listen to - the problem is that the current "no recession" view is primarily predicated on current quarter growth rates looked at in isolation. These data points are then extrapolated into continuous future economic expansion.
Sex, Money and Largesse: The Hidden Depression
by Lance Roberts of Streettalk Live,
"Sex" and "Money" are probably two of the most powerful words in the English language. First, those two words got you to look at this article. They also sell products, books and services from "How To Have Better Sex" to "How To Make More Money" ostensibly so you can have more of the former. Unfortunately, they are also the two primary causes of divorce in the country today.
Likely Triggers of the Next Recession
by Lance Roberts of Streettalk Live,
The conjecture about the next recession has raged ever since the end of the last one. Will it be in 2012 or 2013 or, if you believe the many mainstream economists' estimates, never? Historically speaking, recessions have occurred on average of about every 6-8 years regardless of monetary or fiscal policies, the strength of the economy or global peace - they occurred nonetheless. There is really no argument whether there will be a recession in our future. The only question is the timing and cause of it. The latter point is the most important. Recessions do not just happen. They need a push.
Impatience Will Lead To Our Demise
by Lance Roberts of Streettalk Live,
What is both disturbing and disappointing is the lack of foresight exhibited by the media and political leaders of not only Europe but the U.S. as well. It should not be a surprise to anyone that the austerity regimen, agreed to last month as a long term solution to Europe's sovereign debt crisis, is going to cause economic growth to slow. We have been very vocal about this point. Austerity measures cannot be imposed when an economy is saddled by rising debt costs and high unemployment. It will reduce economic output and therefore requires a strongly growing economy to offset the drag.
10 More Years of Low Returns
by Lance Roberts of Streettalk Live,
Ten more years of low returns in the stock market. If you are one of the millions of baby boomers headed into retirement-start saving more and spending less because the stock market won't bail you out. I will explain why this is the likely future ahead for investors. In this weekends newsletter I wrote that "If you put all of your money into cash today and dont look at the market for another decade you will be better off..."I realize that this statement is equivalent to heresy where Wall Street is concerned but there is one reason behind my apparent madness - the power of reversion.
Media Headlines Will Lead You To Ruin
by Lance Roberts of Streettalk Live,
Two weeks ago Barron's ran the cover page of "Dow 15,000". Over the weekend Alan Abelson ran a column titled "Everyone In The Pool". Today, CNBC leads with "Dow 13,000 May Finally Lure Investors Back Into Stocks". Unfortunately, for most investors, the CNBC headline is probably right. Investors, on the whole, have a tendency to do exactly the opposite of what they should do when it comes to investing: "Buy High and Sell Low." The reality is that the emotions of greed and fear do more to cause investors to lose money in the market than being robbed at the point of a gun.
Markets Surge As World Engages In Global Bailout
by Lance Roberts of Streettalk Live,
Today, the remaining survivors of the global financial rout have coordinated an "all in" gamble to save the world from the next impending crisis. This morning's announcement that the Fed, European Central Bank, Bank of Japan, Bank of England, Swiss National Bank and Bank of Canada will lower the rates on currency swaps as well as lower pricing on existing US Dollar swaps provides a massive liquidity canon for the global financial system. While the markets are surging, the important take away here is that the world is in FAR WORSE shape than has previously been discussed.
Results 801–850
of 856 found.
