Suspension of Logic

After every market correction like we are seeing right now, we get to see the same S&P 500 prices we saw in 2014, which is a total suspension of logic in many ways. It is up just 2% since November of 2014. If Trump wins the election, it will most likely go below that point.…

Is The Labor Market Strong?

The biggest question on my mind as an investor who focuses on macroeconomics...is the labor market strong? This Friday we will get the non-farm payrolls data which has shown to be weakening off the peak for many months now. However, it is still showing a positive number of jobs created allowing the unemployment rate to…

A Trump Fed?

The new announcement that the FBI is re-opening its investigation into Hillary Clinton’s emails has moved the polls in Trump’s favor, creating a type of "Trump Fed", with many having him trailing in the low single digits nationally. This puts the possibility of Trump winning the election back onto the table if we assume they…

Trump Is Brexit

Trump IS Brexit. Allow me to explain. The presidential election was in the news today as the FBI re-opened its case investigating Hillary Clinton’s emails after new evidence was found in its research into Anthony Weiner’s separate case. This sent stocks falling mildly. I think we can extrapolate the effect it had on the market…

Soybean GDP Report

The Soybean GDP report came out this morning showing 2.9% growth. I must correct my mistake yesterday where I said the median estimate was 2.9% because the media is reporting the median estimate was 2.5%, so it beat expectations. Looking at the report, there is a lot of weakness behind the great headline number. It’s…

Q3 GDP Will Be Best Of Year

Today was the biggest day of the earnings season with giants Amazon and Alphabet reporting among a slew of others. However, tomorrow’s focus will also be on the Q3 GDP report which is likely to be the best of the year. While it will be the best of the year, baring a shocking report, it…

Tesla Smoke & Mirrors

Tesla is the ultimate representative of this current environment. It consistently loses money, misses expectations, and maintains its status as an exciting growth company. Businesses with strong fundamentals are few and far between. Today I saw a stat that said the FANG (Facebook, Google, Netflix, Amazon) stock performance makes up 90% of the S&P 500’s…

How Are Earnings?

Going into this earnings season earnings were expected to decline 2% year over year. Earnings expectations are a farce unfortunately. Analysts may have always been lowered expectations to foster earnings beats, but this practice has become painfully obvious recently because of the current environment where EPS growth has been negative while stocks have been rallying.…

Speculating On Future Fed Policy

My edge when it comes to speculating on future monetary policy is that I remain objective when making projections. The so called ‘Fed skeptics’ have been closer to projecting actual Fed policy than mainstream investment bankers and commentators. The Fed itself has also had a terrible track record at predicting its own policies. This is…

Fed Caught Between A Rock & A Hard Place

The long term consequences of the Fed’s policy mistakes are obvious. Low interest rates created the tech and real estate bubbles, so having interest rates lower for longer is going to cause more damage. We are already seeing these effects bear fruit as the S&P 500’s median price to sales ratio is the highest ever.…