Rule of 20 Signals Stocks Are Expensive
Final 5 Bear Market Signposts Let's review the bear market signposts individually to see if they imply a bear market is coming. 11 of the 19 warning signs have been triggered. In previous articles, I’ve reviewed the first 14 of them and determined that 4 are unreasonable, meaning less worry should be given about an…
Active Investing Faces Cyclical & Secular Headwinds
The Shift From Active To Passive Investing We reviewed the first 10 bear market signposts in a previous article. This article will look at the next few. Remember that, of the first 10, I felt 3 were irrelevant. The 11th signpost is triggered when the net percentage of consumers who think stocks will move up is…
11 of 19 Bear Market Warnings Signaled
Bear Market Signals Triggered In previous articles, we've reviewed the 30 risks for 2018. Now let’s look at the 19 bear market signposts. As you can see from the image below, 11 of the 19 signposts have been triggered already. The first trigger is the Fed raising rates by more than 75 basis points. This…
Bitcoin May Have Topped
The Bitcoin Peak Might Be In There’s a belief system among long term investors in bitcoin, known as hodlers, that bitcoin will always rally. The concept is if this rally ends in an elongated correction of 50% or more, there will eventually be another rally which brings it to new heights a few years down…
Margin Expansion Expected To Drive Earnings 11.8% Higher In 2018
2017 Earnings Were Led By Energy, Materials, and Tech At the beginning of the year, I expected 5%-7% earnings growth for 2017 based on the trend of earnings reports missing estimates. As we’ve discussed throughout the year, this year has been different from the past few because it has come close to meeting the initial…
This Could Be The Longest Expansion Since 1854
Santa Clause Rallies Don’t Happen As Often As They Used To Stocks indexes were down slightly on Tuesday because of AAPL. Apple fell 2.54% because of reports of weak demand for the iPhone X. If the iPhone X sells badly, the company will shift its focus to lower priced products like the iPhone 8, hurting…
Only Four 1% Daily Declines In Stocks In 2017
2017 Was The Perfect Year? With bitcoin falling 45% from its peak in just a few days, stock investors are still sitting pretty as there have only been four 1% daily selloffs in the S&P 500. As you can se from the chart below, this is by far the lowest amount of daily 1% selloffs…
Is The Crypto Craze Over?
Bitcoin Crashes Over 30% The crash in bitcoin is starting to look like something more than a minor setback like we’ve seen in the past few weeks. It has fallen a more than $6,000 from its peak at $19,661 which is highlighted in the chart below. I think this is a great thing for stock…
Bitcoin Falls By $4,000
No Government Shutdown The deadline for the spending bill was December 22nd. If nothing passed there would be a government shutdown. On Thursday, the government averted this issue as the House passed another short term spending bill which lasts until January 19th. This means there won’t be volatility in the next week, but it also means…
Amazon Just Getting Started Suppressing Inflation?
What Will Firms Do With The Extra Cash? With the tax cuts passing today, there have been some firms announcing pay increases and investments. It’s easy to get caught up in anecdotal evidence from headlines. The chart below gives you a more complete picture of what firms are likely to do with the extra money.…
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