CPI Comes In Hot

The CPI report came out today. To no one’s surprise, the stock market is up on the news. It reached a record high for the 5th straight day even as the VIX was up 11.45%. The Shiller PE has reached a 29 handle which means it is about 3.5 points away from the high set…

Semi-Annual Fed Report

Today the Fed gave its semi-annual monetary policy report to the Senate. It’s debatable whether any policy changes on interest rates were made because it’s a matter of tone. According to Goldman Sachs the chance of a rate hike in March increased from 15% to 20%. The chance of a rate hike in June increased…

The Dow Likely Isn’t Going To 36,000: Part 1

In this post, I will respond to the article in the Atlantic which is titled “Dow 36,000.” The article is filled with contradictory statements and logical fallacies. I think it’s a good idea to debate the concepts it promotes head on. I’m starting the debate out on the losing end for some readers because they…

Tarullo Resigns- Trump Fed Picks Coming

Daniel Tarullo, the Fed’s top regulator stepped down on Friday, effective April 5th, 2017. Tarullo was chairman of the board’s Committee on Supervision and Regulation. He also was chairman of the Financial Stability Board’s Standing Committee on Supervisory and Regulatory Cooperation. He’s also a voting member of the central bank’s policymaking panel. He’s been a…

Earnings Estimates Head Lower

Every Friday FactSet releases the updated aggregate information on earnings. I will review the new data. It was a poor update, but clearly the market doesn’t care as it rallied to new all-time highs. The market hasn’t cared about earnings for this entire cycle. Amazon stock declined after having a disappointing earnings report, but it…

Snap Probably Isn’t The Next Facebook

I have been following Snapchat for a few years. I found myself wondering if the company would be able to do its IPO in time before the credit cycle ended. In fact, CEO Evan Spiegel himself seems to be knowledgeable about the perils of Federal Reserve money printing. It’s an interesting parallel as his company…

The Unlikely Rally Continues

The unlikely event that stock prices would rise this year given their expensive valuations to start the year is occurring. If you annualize the returns of the S&P 500, the market is on pace to return in the high 20% range for 2017. That goes against what I have been projecting. This is why I…

Positive Arguments For Stocks

The major indices all hit record highs Thursday extending the valuations to even more extraordinary levels. The dollar has been increasing in the past few days which may be a result of the border adjusted tax being discussed. I’d consider it a fat tail event. If Goldman’s estimation that there is a 20% chance of…

Is the Market Broken?

The stock market is reaching extreme levels in terms of the lack of volatility and high valuations. However, given the market’s ability to shake off bad news last year, it’s not surprising to see it rallying in the past few weeks. Earnings are finally growing again, the Fed is promising to remain dovish, and Trump…

Border Adjusted Tax

It’s trouble in paradise for the GOP led Congress. Their reward for winning the contentious election last year is to deal with the problems with the U.S. tax code. Considering the convoluted nature of the system, it sounds more like a penalty, to me. On the campaign trail, it’s easy for politicians to claim they…

Page 2 of 40