Volatility Returns- Much More To Come

In my article last week, I mentioned the VIX was at unusually low levels. Today the market fell and the VIX finally increased off its near record-low levels. The VIX was up 12.29% to 11.88. This is still relatively low, but it’s no longer extremely oversold. The media narrative was that stocks sold off today…

German CPI Spikes To Highest In 3.5 Years

Today the German Consumer Price Index was released. The CPI showed price increases of 1.9% which was below expectations for 2.0%. Two percent is the inflation target the ECB has for the entire European Union. The 1.9% inflation in Germany is the highest rate since mid-2013, as you can see in the chart below. This…

The VIX, Auto Bubble & Bitcoin

In this article, I will focus on a few separate issues I have previously discussed. The first point is about how low the VIX is. Even though the market was broadly down, albeit modestly, the VIX fell to 10.58 which is very low. So far, earnings season has been filled with earnings adjustments beating expectations…

GDP & Durable Goods Orders

Friday, we received the durable goods orders and Q4 GDP report. The durable goods headline report of -0.4% growth month over month looked worse than it was because of sharp declines in defense spending. The 1.9% Q4 GDP growth rate headline was weak as it missed the Atlanta Fed’s GDP Now expectation for 2.9% growth.…

The Border Tax

The bears are waiting for a catalyst for stocks to crash, but they’ve been waiting for quite a while with nothing to show for it, but losses. Valuation has not been shown to work as a sell signal. The fundamentals of the economy and corporate earnings haven’t been able to move the market lower even…

The Dollar Ends Correlation With Trump Trade

Going into the year I predicted the Trump trade would unwind. This means I expected the dollar rally to end, interest rates on government bonds to fall, inflation to fall, and cyclical stocks to fall. I still hold this view and it’s too early to make a final judgement on this perspective. However, there’s been…

Snapchat Readies For IPO

I consider Snap to be the most interesting IPO of this year because of how fast it is growing and the potential $25 billion valuation it may receive. Snapchat is an app that teenagers and 20 somethings love, but transitioning to a real business is tough. The app which was known as a flirting device…

Dow Hits 20K: Bubble Continues

The higher the market goes, the larger the crash will be when it unwinds. That’s the way I look at the latest rally in stocks which finally put the Dow over the 20,000 mark. The tight range was finally broken in a big way today as each major index, including the Russell 2000 was up…

Snapchat Is Not Groupon

There was recently an article on CNBC about why Trip Chowdhry, the managing director of equity research at Global Equities Research, believes the Snap IPO is “total junk.” He thinks the social media phase is over and users don’t want to try new apps. I think Trip was projecting his own personal viewpoints instead of…

Is The Market Off?

In my article yesterday, I mentioned the market has been in a very narrow range. Today data on the S&P 500’s range was posted on CNBC. The 1.6% range the S&P 500 has been in, in January is the narrowest range since November 1965. The tight August range was 2.1% which was the narrowest since…