A new COVID variant started the ruckus for markets, but we view that as secondary to the real culprit—the Fed’s more aggressive response to the “on Fire” data. Lower valuations is our call for 2022, and the Fed’s accelerated taper just brings it forward. Favor Large Cap Defensive Quality. We Didn’t Start the”Fire.” Over the…...
Who needs a reset? Is it the S&P 500 (SPX), the forward price/earnings (P/E) multiple, the Nasdaq (COMPQ), the Russell 2000 (RUT), maybe all of the above. Since Black Friday, the markets have come under “heavy fire”, with pessimism, fear and volatility like many investors haven’t seen in a while. It’s times like these that…...
Spend 2 seconds on FinTwit and you’ll see why equities fell 5% in Sept, rose 10% in Oct and then fell 4% again. Overreacting in both directions is what equities do. Set your sails on things like macro but trim based on psychology because that’s what drives ‘short term’ action. ~Urban Carmel If you desire…...
Macro Strategy—Businesses have responded to unprecedented U.S. consumer-demand strength and rising capacity utilization rates by bringing real equipment investment slightly above pre-pandemic levels as 2021 progressed, with strong investment plans for 2022, especially in automation and production re-shoring. Still, big upside risks to consumer demand, logistical backlogs and labor shortages suggest supply may continue to…...
This week, we provide feedback to our 2022 Outlook—spoiler alert—there wasn’t as much as usual. Meanwhile, consumers are opening up wallets for the holidays as our survey suggested a few weeks ago. The question for investors is how long will it last? We make the case for a fade in 1H22. Primary push back is…...
Since the S&P 500’s 8-day win streak ended on November 8th, I think we can say that the market has done two things: 1) Committed to the seasonal pattern 2) Gone nowhere with increased volatility. The last two weeks have produced uninspiring price action for market participants, with both bullish and bearish narratives thrown into…...
“Nobody can catch all the fluctuations. In a bull market your game is to buy and hold until you believe that the bull market is near its end. To do this you must study general conditions and not tips or special factors affecting individual stocks.” ~Jesse Livermore If you would like to review the weekly…...
With financial conditions tightening and earnings growth slowing, the 12-month risk/reward for the broad indices looks unattractive at current prices. However, strong nominal GDP growth should continue to provide plenty of good investment opportunities at the stock level for active managers. Uncertainty breeds dispersion. The economic and political environment has been permanently altered from its…...
We’re back! It has been a couple of weeks since our last weekly Research Report, but we hope some time away from study and due diligence did not find investors worse for wear, as the market has achieved new highs. Those new highs have been met with yet another modest period of consolidation, thus far.…...
Market participants can access data points; access is NOT the struggle. The struggle is in the SEQUENCING of data points Without the appropriate sequencing, the data loses its utility for an investor/trader, rendering it NOISE in a sea of data points. ~Golden Nuggets To review the weekly State of the Market video, please click the…...
