» Economy

Theoretically, stock prices are a reflection of the future expectations of earnings.  If the expectations are that earnings in the future will be X and currently stocks are trading at a discount to those future earnings prospects then stock prices should rise.  The issue today, however, is that th...

The release of the retail sales data yesterday sure got a lot of people excited about the economy.  In reality, this was much more a statement of inflationary pressures and weather related anomalies than economic improvement.  The revision to January’s data which increased to 0.6% growth wil...

The Weekly Leading Index (WLI) growth indicator of the Economic Cycle Research Institute (ECRI) came in at -2.6 in today’s public release of the data through March 9th. This is the eighth consecutive week of improvement (less negative) data for the Growth Index and the highest level (i.e., lea...

“When the facts change, I change my mind. What do you do sir?” – John Maynard Keynes If the market is doing something quite different than what you think it should be doing, it’s time to reevaluate your thesis.  Great calls are not just about getting the direction right but also the ti...

When I was growing up my father told me more than once that “if you do that, son, you aren’t going to like the consequences.”   Generally, those words were spoken to me just before I wanted to do something to fill an immediate desire – such as spending all my yard mowing m...

The Weekly Leading Index (WLI) growth indicator of the Economic Cycle Research Institute (ECRI) came in at -3.0 in today’s public release of the data through February 24th. This is the seventh consecutive week of improvement (less negative) data for the Growth Index and the highest level (i.e....

Earlier this week the Commerce Department issued their second revision to fourth quarter GDP growth up to 3.0 percent from the initial estimate of 2.8 percent.  This compares to 3rd quarter GDP of 1.8%.  The upward revision to the percent change in real GDP primarily reflected an upward revision t...

With socionomics, it’s no surprise at all… Democracy has long been considered a model political structure for self-governing societies. So why is “government of the people, by the people, for the people” losing ground? Consider what The Economist magazine observed: “F...

The February Advance Report on January Durable Goods was released this morning by the Census Bureau. Here is the summary on new orders: New orders for manufactured durable goods in January decreased $8.6 billion or 4.0 percent to $206.1 billion, the U.S. Census Bureau announced today. This decrease,...

Ben Bernanke has said many times that Marriner Eccles, the head of the Federal Reserve in 1936/37 made a mistake by tightening credit (raising reserve requirements). Bernanke blames Eccles’s actions for the 50% stock market collapse in 1937 and the second leg of the depression that followed.Berna...

Foreword from dshort: Jason Leach, the Director of Research/Portfolio Management at Craven Brothers Wealth Advisors, sent me a PDF of his latest research — Sleepwalking Toward a Precipice: Our Observations and Outlook, Part I. Jason kindly granted me permission to share with the Advisor ...

In a previous report, Headwinds for Housing, I examined structural reasons why the much-anticipated recovery in housing valuations and sales has failed to materialize. InSearching for the Bottom in Home Prices, I addressed the Washington and Federal Reserve policies that have attempted to boost the...