Posted on 03/19/2018 4:22:37 PM PDT by SkyPilot
• Price performance difference between tech and utilities has spread lately to a level nearly as wide as when the dotcom bubble burst.
• "The obsession with dot-com stocks in the late-1990s has been replaced today by a fascination with FANG stocks," said Jim Paulsen, chief investment strategist at the Leuthold Group.
Price performance between the two sectors has spread lately to a gap not quite as wide as during the bubble, but close. Using a measure called the "Popular/Panned Ratio", Jim Paulsen, chief investment strategist at the Leuthold Group, sees danger signs growing for the bull market that began nine years ago.
"Even though its magnitude is less dramatic, the character of the PP Ratio in this bull market is amazingly similar to what occurred during the 1990s," Paulsen said in a note to clients. "The obsession with dot-com stocks in the late-1990s has been replaced today by a fascination with FANG stocks." FANG stocks entail Facebook, Amazon, Netflix and Google-parent Alphabet.
While the performance gap between the two sectors stayed flat during the early years of the bull run, it has expanded since 2016 and has surged in recent months.
(Excerpt) Read more at cnbc.com ...
I had a friend who is a heavy stock market player (made millions) tell me that the market is VERY dependent on technology stocks. Google, Apple, Amazon, Oracle, Intel, Microsoft, Cisco, and Facebook of course - but many other stocks depend on those stocks.
Timed to influence the elections.
my concern is what my allocation is heavy in and it aint dot coms
Some of these stocks are reasonably priced, and some are not.
Any stock that relies on the preferences of people that can be changed in 15 seconds at no cost is not a safe investment. Hence, Facebook is always in jeopardy.
But you get the idea (or, maybe you don't...) that something a bit different may be going on a day when the techs got hit, Johnson & Johnson was down 4 points at one point today.
One piece of concern is that under many/most market regimes, stocks like JNJ take on a kind of "safe haven" eg; conservative status because they pay a dividend.
But in an era of rising rates or the threat of rising rates....those divs may well appear less attractive.
To me, just my own take; far more salient than the stock market are currencies (which I do not trade) and bonds (which I *do* trade in the for of surrogates. Those markets are massively larger than the stock market. The stock is not the tail of the dog, it is a flea on the tail of the dog.
The Fed has to (or just does) force people to buy bonds. One of the ways they do this is: to crash the stock market. The Fed has to force people to buy bonds even if they look like pieces of used dogfood. And they sometimes do this by making stocks look really, really scary.
Also, of late, much of the market strength has relied upon a brutalized dollar that has really gotten pretty weak. When the dollar strengthens, usually the market falls. That's on a day basis.
Trump’s fault /s
First, this centers on the Facebook “scandal”. It wasn’t a hack, and the rules of the time were followed with FB’s blessing. Next, people are shocked....SHOCKED I tell you....that FB collects and sells data about them. Gimme a break!
Good advice.
I think the salient takeaway from the article is this:
"While this does not suggest a massive collapse — similar to the aftermath of the dot-com era — is forthcoming, it is another reminder that the character of the current bull market has changed," Paulsen said. Utility shares are down about 5.5 percent year to date, while tech has been the market's best performer, up nearly 7 percent. Essentially, the sector has become a proxy for the greatest risk appetite. Tech, however, was the worst performer in Monday's market dip, which saw major averages down 2 percent in afternoon trading.
Best line from Shark Tank, if you can’t tell what the product is from a website, you’re the product.
I’ve been telling that to people for 10 years about Facebook and people still don’t believe me.
Did you see the fake news today saying that Facebook had its analytics used to elect Trump? Total fake news
How China Is About to Shake Up the Oil Futures Market - Bloomberg
https://www.bloomberg.com/news/articles/2018-...Proxy Highlight
Mar 7, 2018
1. When will trading begin? From
March 26. Daytime trading hours will be from 9 a.m. to 11:30 a.m. and 1:30 p.m. to 3 p.m.
Denominating oil contracts in yuan would promote the use of China’s currency in global trade, one of the country’s key long-term goals.
* possible dollar collapse after March 26 - petro yuan.
God only knows...
one slight difference, the "Dot.com" bubble was based on anything with a .com in the name, dint matter there was nothing behind it/no there there at least with most tech stocks, there's a real product behind it...
The Fed likes to use the excuse that prosperity and rising wages cause inflation.
Yup. When Facebook first went public and soon had billions in investment, a Freeper said: "Ummm, Facebook is a website. Using the same logic, Free Republic should be worth hundreds of millions."
Free Republic is priceless.
Amazon at a PE ratio of a staggering 343 with a $760 Billion market cap is totally nuts. At least Apple has huge profits, so even at a market cap of $900 Billion, Apple’s PE is still only 17. But Amazon? Outside of the cloud, they are in a very low margin retail business. And in cloud, Microsoft Azure is growing much faster than AWS and Microsoft has vastly more profits and far deeper pockets.
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