Another Round of Panic

Trading and investing are quite different things, a matter of time frames. Today’s trading was sparked by the ISM services report, something that has not attracted much attention in recent years.  The Market has focused more on the traditional ISM manufacturing survey, partly because it has a longer history, and a clear link to GDP.  […]

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The Stress Test

As we write this, foreign markets have plunged over the weekend.  Stocks will open lower — much lower — at a frightening level.  Individual investors may well panic.  Some traders will see this as the indicator they have been seeking – a dramatically lower opening that provides a buying signal. We reported our own short-term […]

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Market Response to Recessions

Each day the market gets "new information" about a slowing rate of economic growth.  If the rate of economic growth slows enough, it can and will be interpreted as a recession, when the NBER does a retrospective analysis of the data.  What does this mean for investors? An Interesting Table Let us take a good […]

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When to Pull the Trigger

There is a special psychological barrier for those contemplating the purchase of U.S. equities — long-term investors and traders alike.  The memories of losses in the 2000 era are still fresh.  Those who do not study the fundamentals of market valuation — forward earnings and interest rates — see a market reaching the old highs […]

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New Market Highs: What’s the Downside?

As the market reaches new highs, investor fear increases.  Much of this relates to a focus on price without regard to what has happened to earnings and the economy since the 2000 era.  How should the investor consider this?  Is the story different for traders? One approach is to consider the downside risk.  This means […]

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