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Brexit: Still A Process, Not Yet A Destination
I happened to be in the United Kingdom on a long-planned family vacation on June 23, 2016, when the Brexit vote took place. At the time, I offered a stream-of-consciousness “Seven Reflections on Brexit” (June 26, 2016). But more than year has now passed, and Thomas Sampson sums up the research on what is known and what might come next in “Brexit: The Economics of International Disintegration,” which appears in the Fall 2017 issue of the Journal of Economic Perspectives. (As regular readers know, my paying job–as opposed to my blogging hobby–the Managing Editor of the JEP. The American Economic Associat... -
Finance 0
Exodus: U.S. Funds See 3rd Largest Junk Outflow On Record
Just how nervous did folks get during the junk bond rout that finally took a breather when spreads tightened materially on Thursday? Well, pretty damn nervous, according to the flows data. “Following the decline in high yield bond prices this month, high yield US funds and ETFs reported $4.43bn in outflows this past week,” BofAML writes on Friday, citing EPFR. That would be the third largest exodus on record and the largest since August 2014: Is it time to buy the dip? In short: probably not. As Goldman writes in their weekly credit trader note, this really shouldn’t come as a surprise. For months, the bank has suggested that decompress... -
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Stocks Going Ex Dividend The Fourth Week Of November 2017
Here is our latest update on the stock trading technique called ‘Buying Dividends,’ also commonly referred to as ‘Dividend Capture.’ This is the process of buying stocks before the ex dividend date and selling the stock shortly after the ex date at about the same price, yet still being entitled to the dividend. This technique generally works only in bull markets, and can work in flat or choppy markets, but you need to avoid the technique during bear markets. In order to be entitled to the dividend, you have to buy the stock before the ex-dividend date, and you can’t sell the stock until after the ex date. The actual dividend may ... -
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ECRI Weekly Leading Index: WLI At 5.5% YoY
Today’s release of the publicly available data from ECRI puts its Weekly Leading Index (WLI) at 145.6, down 0.1 from the previous week. Year-over-year the four-week moving average of the indicator is now at 5.52%, down from 5.53% last week. The WLI Growth indicator is now at 2.7, down from the previous week. “Why So Many (in the West) Are Pissed Off” ECRI’s recent article recounts two thousand years of world GDP history, reminding readers that India and China have been the winners throughout. The West has only made a dent in world GDP since the Industrial Revolution. In order for the US to maintain its place in global ... -
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Rob From The Middle Class Economics
Much of our financial world functions as a “Rob from the Middle Class” economy. The system robs from the middle class and poor via “money printing” and inflation of the currency supply! The rich get richer and the poor get poorer. Little benefit comes from complaining about the process or fighting it. Understand the process, work around it, and use it constructively. Explaining Our Rob from the Middle Class Economy: Governments, individuals, pension funds and corporations are increasingly financialized and dependent upon debt, central bank interventions, and currency devaluations. Wages are less relevant in a financialized economy bec... -
Finance 0
This Market Wants To Go Back To Its All-Time Highs Again
My Swing Trading Approach I need to see this market demonstrate some follow through on yesterday’s rally that pushes price action back to or near its all-time highs. Indicators VIX – Dropped 10% yesterday down to 11.76. Far off its recent range of sub-10. Broke the 5-day wining streak. T2108 (% of stocks trading below their 40-day moving average): Massive bounce yesterday, of 11.5% to 46%. Still overall weak, and with the Nasdaq making new all-time highs, it isn’t normal for this few of stocks to be trading above their 40-day moving averages. Moving averages (SPX): Just like that, it recovers the 5, 10 and 20-day movin... -
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Don’t Let Home-Bias Investing Trip You Up
The total U.S. stock market has gained over 20% during the past year and is doing great. But for U.S. investors that are under-weighted to foreign stocks, it’s not so great. Why? Because foreign stocks have convincingly outperformed U.S. equities, thereby causing a performance deficit. What’s the problem? The tendency of investors to concentrate and tilt their stock and bond holdings toward their home country is referred to as “home-bias investing.” And strong returns in the U.S. stock market (DIA) have largely camouflaged the problem of being over-weighted to domestic stocks. Emerging market equities (VWO) from countries like China, ... -
Finance 0
USD/JPY Weakness To Persist On Dovish FOMC Minutes
The Japanese Yen outperforms its major counterparts going into the last full-week of November, and USD/JPY may continue to give back the rebound from the 2017-low (107.32) should the Federal Open Market Committee (FOMC) Minutes drag on interest-rate expectations. In light of the muted reaction to the 13.7% rise in U.S. Housing Starts, it seems as though market participants are still deciphering the fresh rhetoric from central bank officials especially as Dallas Fed President Robert Kaplan, a 2017-voting member, warns the 10-Year U.S. Treasury yield reflects pessimism for future growth. Even though the FOMC is widely anticipated to fu... -
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New Residential Housing Starts Up 13% In October
The U.S. Census Bureau and the Department of Housing and Urban Development have now published their findings for October new residential housing starts. The latest reading of 1.290M was well above the Investing.com forecast of 1.185M and an increase from the previous month’s upwardly revised 1.183M. Here is the opening of this morning’s monthly report: Housing Starts Privately-owned housing starts in October were at a seasonally adjusted annual rate of 1,290,000. This is 13.7 percent (±10.5 percent) above the revised September estimate of 1,135,000, but is 2.9 percent (±10.1 percent)* below the October 2016 rate of 1,328,000. ... -
Finance 0
As Oil Heads For Down-Week, Crude Stakes Are Huge
After five straight weeks higher – read by many as confirmation of how awesome the global coordinated recovery must be – WTI and Brent dropped this week as inventories rose, demand outlooks dimmed, and OPEC hope faded. As Alhambra Investment Partners’ Jeffrey Snider notes, there is a titanic struggle going on right now in the oil market. On the one side of the futures market are the usual pace setters, the money managers. Last week, the latest COT data available, they went the most net long since March. If it continues, it will close in on the most positive futures position since the record long they established back in...
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