So Bad, It’s Good? We highlighted Bank of America’s 0.0 bull/bear ratio several weeks ago — noting that the absolute nadir of bearish sentiment is not a sell indicator.The global fund manager survey (above) from the same analytical team, showing managers to be even more pessimistic than they were the Read more…
Inflation Bites Another month, another sky-high CPI print: at 9.1%, the highest year-over-year inflation since 1981. Of course, the methodology of constructing this index has changed over the decades; if the methodology employed in 1990 were used today, the reported rate would be 17.3%, according to ShadowStats. Even this is Read more…
The U.S. is likely already in recession. The first quarter saw a real GDP decline of 1.6%; the Atlanta Fed’s GDP now tracker suggests that the second quarter may come in at a decline of 2.1%. Two consecutive quarters of decline meets the technical definition of a recession. The question Read more…
As we write, the U.S. stock market is undoing the momentary relief that followed yesterday’s hawkish Fed announcement. The proximate cause was perhaps the overnight announcement that the Swiss National Bank would consider selling down its $177 billion worth of U.S. equity holdings as it defends the Swiss franc. Perhaps Read more…
Of course, all eyes are on the Fed, inflation, and employment, so much of what we wrote above fills out our general view of where markets are and what is most important to pay attention to. We’ve commented many times in the past about the rise of ESG investing — Read more…
First, let’s touch on the inflation level revealed by the Guild Basic Needs Index [GBNI] — our in-house, real-world inflation measure which we compile from a simple set of data series covering consumer expenses for food, shelter, clothing, and transportation. We had to adjust the x-axis on our graph: year-on-year, Read more…
In this second quarter of 2022, individual investors’ sentiment hit levels not seen since 2009. History suggests that periods with historically low investor sentiment (1) usually precede a large tradeable rally, and (2) can create an attractive entry opportunity for longer-term investors. Market tops do not announce themselves beforehand, or even Read more…
After a brief moment of optimism (intoxication?) after Fed Chair Powell took 75-basis-point rises in the Fed funds rate off the table, stock markets accelerated their decline. The damage to stocks is more evident internally than externally. On the surface, the correction has only started getting to the broad indices. Read more…
As earnings season unfolds, we are hearing many company managements mentioning foreign exchange issues as headwinds — when you hear “currency neutral” numbers being reported, it is likely that under the hood, there are negative foreign-exchange effects to be found. A strong dollar will hurt many companies which are reliant Read more…
What is Happening In China? Shanghai, and many other Chinese cities, are once again under extreme covid lockdown conditions — the most stringent since April 2020, as China pursues its apparent “zero covid” policy. The images and videos percolating through to western social media are profoundly disturbing, and prompt a Read more…
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