When you feel like giving up, realize that at that very moment, you are at the same fork in the road that everyone eventually faces. If you quit, you are being just like every other coward who takes the easy way out and chooses to give up. Choose to persist! ~Mark Minervini If you would…...
With our view for lower multiples and earnings now more consensus, the markets are more fairly priced. However, it does not price the risk of a recession, in our view, which is 15- 20% lower, or roughly 3000. The Bear market will not be over until recession arrives or the risk of one is extinguished.…...
Research Report Excerpt #1 The Bank of America Bull & Bear Indicator is currently at 0. This is probably the slowest of all indicators among investment banks. The track record when this hits zero is rather strong (unless double dip recession or systemic event). The previous times the Indicator hit zero were in August ’02,…
The great Q1 2022 earnings have proven the forward-looking nature of markets. I’m kicking-off this weekend’s Research Report with this assertion, because Seth and I are of the opinion it proves an important concept that investors need to better understand. MARKETS ARE FORWARD DISCOUNTING/LOOKING MECHANISMS. For each earnings and sales beat during the Q1 reporting…...
Equity Risk Premium holds key inputs/ingredients After major market sell-offs, it becomes increasingly difficult to achieve lower-lows. They are not impossible, obviously, just increasingly difficult. At some point, valuations and the hunt for real yield reign supreme. Let’s look at one reason why, and through the lens of the Equity Risk Premium (ERP). Why should…...
Cross-Asset Strategy: Friday’s strong CPI print that led to a surge in yields, along with the sell-off in crypto over the weekend, are weighing on investor sentiment and driving the market lower. However, we believe rates market repricing went too far and the Fed will surprise dovishly relative to what is now priced into the…...
Macro Strategy—Inflation Dimming Economic Outlook: On multiple levels, including strong labor demand, decades-low household leverage, lack of excesses on the housing construction/business investment fronts, massive household savings accumulated during the pandemic, and elevated corporate profits, the U.S. economy would appear well positioned for sustained strong growth. However, the economy has rapidly moved into the late…...
“People who succeed in the stock market also accept periodic losses, setbacks, and unexpected occurrences. Calamitous drops do not scare them out of the game.” – Peter Lynch. The “Market Trap” is laid when the fears of today evoke a belief of ever-worsening circumstances. History has proven, there is no such thing as ever-worsening circumstances,…...
Cross-Asset Strategy: The growth-policy tradeoff appears set to improve in 2H, and earnings revisions turned broadly positive in key regions. Chinese equities may have reached their turning point as lockdowns begin to ease, growth support measures continue, and news reports that China is about to conclude its probe into Didi suggest regulatory risks are easing.…...
Research Report Excerpt #1 Recall that prior to May’s, 6%+ month-end rally, the S&P 500 was down 7 consecutive weeks. This was the longest weekly down streak since 2001, which fell 8 straight weeks (and was tied w/ 1970 for the record). Here’s a look at what happened following the longest down streaks in history. A…
