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Tag Archives: margin debt

Questions About The “Stellar” June Jobs Report (Which Also Confirm The Fed’s Concerns)

On Wednesday, Jerome Powell testified before Congress the U.S. economy is “suffering” from a bout of uncertainty caused by trade tensions and slow global growth. To wit: “Since [the Fed meeting in mid-June], based on incoming data and other developments, it appears that uncertainties around trade tensions and concerns about the strength of the global economy continue to weigh on the U.S. economic outlook.” That outlook, however, would seem to be askew of the recent employment report for June...

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The Fed, QE, & Why Rates Are Going To Zero

On Tuesday, Federal Reserve Chairman Jerome Powell, in his opening remarks at a monetary policy conference in Chicago, raised concerns about the rising trade tensions in the U.S., “We do not know how or when these issues will be resolved. As always, we will act as appropriate to sustain the expansion, with a strong labor market and inflation near our symmetric 2 percent objective.” However, while there was nothing “new” in that comment it was his following statement that sent “shorts”...

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The Message From The Jobs Report – The Economy Is Slowing

Last week, the Bureau of Labor Statistics (BLS) published the March monthly “employment report” which showed an increase in employment of 196,000 jobs. As Mike Shedlock noted on Friday: “The change in total non-farm payroll employment for January was revised up from +311,000 to +312,000, and the change for February was revised up from +20,000 to +33,000. With these revisions, employment gains in January and February combined were 14,000 more than previously reported. After revisions, job...

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You Have A “Trading” Problem – 10 Steps To Fix It

In April of 2018, I wrote an article entitled “10-Reasons The Bull Market Ended In 2018” in which I concluded: “There is a reasonably high possibility, the bull market that started in 2009 has ended. We may not know for a week, a month or even possibly a couple of quarters. Topping processes in markets can take a very long time. If I am right, the conservative stance and hedges in portfolios will protect capital in the short-term. The reduced volatility allows for a logical approach to...

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Did The Market Miss Powell’s Real Message?

Last week, I discussed the recent message from Fed Chairman Jerome Powell which sent the markets surging higher. “During his speech, Powell took to a different tone than seen previously and specifically when he stated that current rates are ‘just below’ the range of estimates for a ‘neutral rate.’ This is a sharply different tone than seen previously when he suggested that a “neutral rate” was still a long way off. Importantly, while the market surged higher after the comments on the...

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Did The Market Miss Powell’s Real Message?

Last week, I discussed the recent message from Fed Chairman Jerome Powell which sent the markets surging higher. “During his speech, Powell took to a different tone than seen previously and specifically when he stated that current rates are ‘just below’ the range of estimates for a ‘neutral rate.’ This is a sharply different tone than seen previously when he suggested that a “neutral rate” was still a long way off. Importantly, while the market surged higher after the comments on the...

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Jeremy Grantham’s Best Long-Term Advice For Investors

Over the weekend, I was reviewing some old commentary and stumbled across a piece from 2012 which contained an excerpt from Jeremy Grantham who is the famed investor at GMO. I have spoken, and written many times in the past, that the media and Wall Street alike promotes the bullish and optimistic views not because it is correct – but because it sells product. There is no value in telling the retail investor the truth about the risks in the market because investors would pull money out of the...

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Let’s Be Like Japan

There has been a lot of angst lately over the rise in interest rates and the question of whether the government will be able to continue to fund itself given the massive surge in the fiscal deficit since the beginning of the year. While “spending like drunken sailors” is not a long-term solution to creating economic stability, unbridled fiscal stimulus does support growth in the short-term. Spending on natural disaster recovery last year (3-major hurricanes and two wildfires) led to a pop...

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All Markets Are Cyclical – When Will This One End?

I always enjoy reading John Stepek’s work at MoneyWeek. Just recently he addressed the question of where are we in the current market cycle. To wit: “In his latest memo to clients, [Howard Marks] outlines his basic philosophy and how it affects Oaktree’s investment process at the moment. Marks’ basic point – which appears pretty self-evident, though you’d be surprised by how many people try to deny it – is that markets move in cycles. The tricky part is trying to work out when the cycle is...

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The Two Biggest Threats To This Bull Market

This bull market seems unstoppable. Regardless of short-term events, investors have quickly looked beyond those risks to in a bid to push stock prices higher. For example, in February of this year the markets dove roughly 10% as “trade wars” became a “thing.”  Over the next two months, the markets vacillated coming to grips with what “Trump’s war with China” would actually mean. Last week, the Administration announced a further $200 billion in tariffs against China, China cancels talks with...

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