What’s the problem with low yields? They encourage more borrowing, lower the costs of business expansion, and in theory, create inflation – as the increase in debt (a.k.a. the amount of spending that income does not fully cover) produces upward pressure on pricing because natural demand has been inflated by the amount of new debt. So...Read More
Stocks seem to have flattened out since reaching their December 2013 pinnacle. Sure there was a minor sell-off in January, but stocks have recovered from that. The point to takeaway from current stock market valuations is this: the average has been unable to top the performance of the economy (total market activity). See below. A...Read More
Blogging regularly is an interesting chore. Sometimes the most important topic to talk about is obvious, and other times it’s hard to find. Sometimes the title is self-evident, and other times it doesn’t present itself until long after the fifth draft. It’s an odd process to the say the least. This week’s title came to...Read More
Gold continued to move higher last week as stocks made a U-turn to the downside. The Dow Average is down 3% so far this year, and 15-51 strength has peeled off 2% from its prior year-end. But gold is the story; up 15% year-to-date. The chart below spans a very short time period (just the...Read More
Stocks regained some upward momentum last week as stock market strength gained 2.5% and the average added 1.4%. Gold has quietly risen 10% from its 52 week low set just a couple of months ago. And while the recent ten-point pop might not take all the sting away from the gold correction, it did serve...Read More
Introducing 2.0 At the beginning of the year I began writing my next literary effort, and as stated on the back cover of my first endeavor, “Don’t expect to see a sequel. Lose Your Broker Not Your Money has it all, including an unparalleled guarantee of performance and support via a totally free website…” In other words,...Read More
With the recent release of GDP numbers for year ended 2013 it’s an appropriate time to update the action zone – the historical trading range for the Dow Jones Industrial Average. The action zone is a dynamic range affected by ever changing conditions such as inflation, economic activity, and stock market multiples. It’s meant to...Read More
Stocks continued their downward trend this week but the move was muted by an overreaction to 4th quarter GDP numbers that were released on Thursday. Growth for the fourth quarter 2013 was announced to be an annual pace of 3.2% in Real terms. However… Growth for the year of came in at just 1.3% – a...Read More
“The market” slipped on a banana peel this week and fell 579 points, or 3.5%; “strength” lost just 0.7%, and gold added 1.1%. Speculation about the cause of the adjustment is swirling, with many taking heads blaming it on deteriorating conditions in Emerging Markets. First things first… The Dow Average has been trading much higher...Read More
Stocks remained largely unchanged this week as December activity for wages and prices were reported. The Producer Price Index (PPI) for finished goods rose .4%; CPI (Consumer Price Index) rose .3%, and Real hourly earnings fell .3% in the period. That’s prices up (a.k.a. inflation) and earnings down in America, and when the topics of...Read More
