Posted on 06/08/2013 7:35:31 AM PDT by blam
All Signs Suggest This Is The End Of The Stock Market Rally
Comstock Partners
June 7, 2013, 11:06 PM
The recent return of high volatility to the stock market, bond market and currencies suggest the end of the rally that started in November and probably to the upsurge since the March 2009 bottom. As we stated in last week’s comment the market now appears to be entering a lose-lose situation where economic growth is bad since it forces the Fed to “taper’ its bond buying program, a move that investors, as they have most emphatically demonstrated this week, do not like one bit. On the other hand, if the economy continues its tepid pace (or worse), as we think it will, employment won’t meet the Fed’s goals and earnings will take a dive. In the latter case, the Fed would likely delay tapering of its bond-buying program and investors will interpret bad news on the economy for what it is----bad news.
In comments over the last two months we have shown how various important sectors of the economy have either been slowing down or failing to meet expectations, a condition that has indicated no signs of reversing. The four-week moving average of new weekly unemployment claims has moved from 338,000 to 353,000 over the past month. The ADP employment report for May came in far under expectations, and has averaged 124,000 over the last two months compared to 203,000 over the prior five. The majority of Fed regional surveys have showed weaker hiring in May than in April. The National Federation of Independent Businesses (NFIB) recently reported reduced hiring in May.
The ISM manufacturing index of 49 for May was the lowest since June 2009, when the recovery was only getting underway. That number was even worse
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(Excerpt) Read more at comstockfunds.com ...
And Now The Small Investors Have Come Pouring Into Stocks...
Makes me think it's definitely going to tank.
Bernanke will just start pumping 200 billion a month into the market instead of 100 billion.
As the old Wall Street adage goes, “let the suckers have the last ten percent”.
“Bull markets are born on pessimism, grow on skepticism, mature on optimism, and die on euphoria. The time of maximum pessimism is the best time to buy, and the time of maximum optimism is the best time to sell.
If you want to have a better performance than the crowd, you must do things differently from the crowd.”
— Sir John Templeton
--but no way in hell does anyone here believe it enough to actually pour money into short positions. That means we got a lot of folks here expert with other people's money and clueless with their own.
How many times has this happened since the stock market collapse with the recession? Stock prices collapse, and the rich buy up stocks. The market stays high for awhile, and the little folk join in. When the rally's been milked for all that's possible, the puppet masters pull their profits, and the little guy gets stuck again.
The real driving force to this too-high stock market is low interest rates paid on safe savings (where bank CEOs etc get ever-higher salaries and bonuses). The market went down Thursday with the fear that the fed was going to raise interest rates. Friday, the fear must have been not-so-much.
I don't do the stock market any more, just hold a few small-company stocks that would've been good bets if the recession and foreign competition hadn't messed with small company growth in the US. I used to be pretty good at evaluating small-company potential, but now the numbers all just look weird to me.
The market is feasting on $85Billion/month infusion from the Fed. As long as Obama’s goons continue it, they’ll gladly take the cash from the lone investor. Computers and insiders. Yep, you can beat them!/s
The truth be known; no one knows. Watch and listen to the expert pundits and do just the opposite of what they say and you’ll still be ok.
Fool me once, shame on you...
Here’s another:
Pigs get fat.
Hogs get slaughtered.
After four years of lies by Obama, the New York Times has finally concluded that Obama has no credibility.
After four years of misjudgments by financial ‘’experts,’’ shouldn’t the NYT also conclude that they have no credibility either?
In bull markets, the DOW doesn’t decline by 215 points in a single day, which happened last week. And in bear markets, it doesn’t rise by 207 points in a single day, as also happened last week.
If any financial analyst or mutual fund had consistently beaten the market over the past four years, they would be famous by now, legends in their own time, but no one has done so. Bulls, bears, gold bugs, bond experts, they’ve all been wrong.
Any Wall Street bank that doesn’t fire its expensive analysts and replace them with minimum-wage gypsy fortune tellers has not been paying attention.
Yes I have noticed that too. However there is at least one key difference between 1999 and now and it’s called the P/E ratio which was much much higher in 1999. Having said that the market does not always correlate closely with P/E. That would be too rational. :-)
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