10 Links (Thursday edition)
That worked out well yesterday with the focused daily linkfest.
Once again, 10 links:
• Dow Sends Buy Signal That’s Worked Since 1921: Chart of the Day (Bloomberg)
• Lucrative Fees May Deter Efforts to Alter Loans (NYT)
• Wall Street Analysts Keep Telling Big Earnings Lie At a time when the financial industry’s credibility is at an all-time low, you would think Wall Street’s finest would break their necks providing transparency. Not so. Stock analysts continue to promote corporate earnings lies, insisting that net income isn’t really what investors need to know. (Bloomberg)
• Economic crisis, and a crisis for economics (UK Telegraph)
• Will Everyone Please Shut Up About Goldman Sachs? (thebigmoney)
• Chicago Battle Royale: Behavioral Economist and Nobel winner Richard Thaler responds to nonsense from Richard Posner, the nation’s pre-eminent Market Deifying Judge.
• 7 Ways to (Finally) Fix Housing Not that I agree with most of these, but they are at least thought provoking (Pethokoukis/Political Risk)
• Flaws in the Case Shiller Methodology (Advisor Perspectives)
• Notes on a real estate trip in China (China Financial Markets)
• This is an instant classic: YOU SUCK AT CRAIGSLIST
Thats 10 — anything else capture your eye?
Tweet
Facebook
Reddit
Digg this!
July 30th, 2009 at 2:41 pm
I found this cool:
http://bespokeinvest.typepad.com/bespoke/2009/07/morning-and-afternoon-buyers.html
July 30th, 2009 at 2:45 pm
I thought this was a good link- pitching the case for V shaped recovery-
“You Fools Don’t Get It: This Is A V-Shaped Recovery!”
http://finance.yahoo.com/tech-ticker/article/292454/You-Fools-Don%27t-Get-It-This-Is-A-V-Shaped-Recovery!?tickers=%5Edji,%5Egspc&sec=topStories&pos=8&asset=&ccode=
July 30th, 2009 at 2:47 pm
If anyone is ever looking for me, i’ll be at http://www.yousuckatcraigslist.com/ from now on (unless I die laughing.)
July 30th, 2009 at 2:47 pm
On the Dow buy signal, look at what the result was 3 and 6 months out :)
July 30th, 2009 at 2:48 pm
@karen: I thought that was one of the funniest things I’ve seen in quite a while.
July 30th, 2009 at 2:50 pm
FWIW, these look interesting.
http://www.sentimentrader.com/subscriber/charts/WEEKLY/SURVEY_AAII_BULLS.htm
http://www.sentimentrader.com/subscriber/charts/WEEKLY/SURVEY_AAII_BEARS.htm
http://www.sentimentrader.com/subscriber/charts/WEEKLY/SURVEY_AAII_BULLRATIO.htm
July 30th, 2009 at 2:53 pm
Interesting comparison of the U.S. Empire to the Roman Empire
http://theburningplatform.com/economy/decline-and-fall-of-the-american-empire
July 30th, 2009 at 2:54 pm
i’d love to check out yousuckatcraigslist but my company has that on the social networking black list. this sucks as i have to do more actual work.
July 30th, 2009 at 2:57 pm
That ‘practice table’ for surfers was the best
July 30th, 2009 at 3:00 pm
I find this video to be strangely titillating:
http://www.youtube.com/watch?v=2UXqqDYSgT0
July 30th, 2009 at 3:03 pm
jessica6-
that was definitely a put-on, as was the “looking for a jeoarb”
no-one is that colossally stupid- or at least I hope not
July 30th, 2009 at 3:05 pm
i liked the surfboard/ironing boards, too
speaking of buy signals, the dow theory confirmed a trend change last week – up, and Richard Russell changed his bear to texas longhorn steer – link -> Dow Theory calls a bull market
re. AAII – when sentiment is nearing 80% bullish….. lookout below
July 30th, 2009 at 3:06 pm
here is the link
http://www.investmentpostcards.com/2009/07/24/dow-theory-calls-a-bull-market/
July 30th, 2009 at 3:08 pm
Thank goodness for the link • Flaws in the Case Shiller Methodology (Advisor Perspectives). The weight being given the Case Shiller Index is beyond frustrating to me…
Burns has it right in so many ways: “Burns’ clients, many of whom profited handsomely by shorting the real estate market as the bubble peaked, are now looking for the signal that the market has bottomed. That will not happen soon, according to Burns: He said the recovery will not be a rebound in the housing market, but the beginning of “flat and boring” market conditions. New construction will be at very low levels, foreclosures will remain high, and prices will be stable – not increasing. Burns forecast is based on three underlying assumptions about the economy: He expects job losses to continue through most of 2010 and job growth to remain very low at least until 2012, mortgage rates to rise from 5.5% to 7% over the next four years (which he calls a “middle of the road forecast”), and the government to continue to intervene in the markets…”
July 30th, 2009 at 3:15 pm
“and the government to continue to intervene in the markets…”
we can always count on the USG to slop it up way worse than it would be otherwise
July 30th, 2009 at 3:16 pm
thebigmoney article on GS was an inane puff piece.
Yes, GS bankers are just average nice guys next door who love public service and just happen to get $1M bonii…
July 30th, 2009 at 3:18 pm
Combining a few of the links:
Dow signals beginning of bull based on net income lies. Need we say more?
Turtles and surfing practice tables? And it’s not even Friday.
Guess today’s market isn’t worth discussing.
July 30th, 2009 at 3:26 pm
re: the bigmoney article on GS had a catchy title but wasn’t worth the click that got me there… lol.
July 30th, 2009 at 3:29 pm
Re: the Bloomberg article 90 year “buy signal”
Buy Signal 12 Months 6 Months 3 Months
June 11, 2003 13.36% 8.98% 3.01%
Jan 8, 1999 19.49% 15.38% 5.75%
March 5, 1991 9.05% 1.21% 1.11%
Jan 27, 1989 10.18% 13.46% 4.14%
Sept. 3, 1982 31.38% 23.02% 11.67%
July 18, 1980 3.78% 5.34% 3.48%
Aug. 9, 1978 -3.74% -7.76% -9.83%
March 7, 1975 26.43% 8.63% 9.11%
Dec. 7, 1970 4.73% 12.75% 9.69%
May 8, 1967 1.02% -6.60% 1.41%
Jan. 25, 1963 15.20% 1.18% 5.68%
July 24, 1958 33.51% 19.91% 8.53%
Dec. 13, 1949 16.26% 15.04% 3.15%
Nov. 6, 1942 16.66% 18.21% 8.29%
Sept. 11, 1939 -16.61% -4.49% -5.20%
July 6, 1938 -3.05% 10.95% 7.49%
Feb. 18, 1935 43.10% 19.09% 8.06%
Apr. 19, 1933 54.47% 23.53% 51.63%
Aug. 29, 1932 37.72% -31.68% -21.87%
Aug. 18, 1924 35.82% 14.36% 5.46%
Dec. 12, 1921 21.89% 12.53% 8.12%
Average 17.65% 8.24% 5.66%
OK…Let’s parse this out…
- 6 of the 18 data points came in the July/August time period (where we find ourselves now)
July 19, 1980…nominal gain
August 9, 1978…more than nominal LOSS (one of only two losses)
July 24, 1958…The market was nearing a technical breakout to a new all-time high
July 6, 1938…(second of losses)…Market went on to LOSE 45% off the high
August 29, 1932…The actual birthdate of my late Father (August 29, 1932)…anyway, the market actually TANKED almost 40% right after hitting that number before rebounding…And for God’s sake, that was near the lows from the 1929-32 crash, what do you expect?
August 18, 1924…Nothing special here, except that the signal was hit during a long trough…So there must have been some REAL economic event that triggered a rally…
July 30, 2009???
WTF – Based on the observations above, I toss this measure in the scrapheap…Sounds good on TV though…
July 30th, 2009 at 3:39 pm
My verdict on The Big Money site after sampling over time is that it’s not worth the time. Mostly crap, just more MSM type B.S. for the most part. I’m sure there’s an exception or two, but I haven’t seen one.
July 30th, 2009 at 3:40 pm
Barron’s had a better article on the Dow Theory buy signal
http://online.barrons.com/article/SB124882070863788163.html#mod=BOL_hps_dc
More Questions Raised About Dow Theory By MICHAEL KAHN
Followers of the famous stock-chart technique got a major buy signal last week. But after a 45% stock rally, should investors follow?
..I have my doubts that the signal is meaningful for investors. More likely, it seems to be just an academic exercise looking backward in time to tell investors what they should have done weeks ago.
In my February column, I questioned the overall validity of tracking these two indexes in the modern world. Neither index really represents the same sectors they did when Charles Dow formulated his famous averages more than a century ago (see Getting Technical, “Be Leery of Dow Theory,” Feb. 19, 2009).
July 30th, 2009 at 3:41 pm
here’s an interesting little article-
“US Now Citigroup’s Biggest Shareholder”
http://www.cnbc.com/id/32222264
whoever said the taxpayer’s wanted to be shareholders of C in the first place-
the USG- what simpletons- that private investors won’t invest- so why should the taxpayers want a piece of it- especially a 34% piece
July 30th, 2009 at 3:42 pm
lefty and karen –
agree – GS article was crapatola puff
and besides, vampire squid wrapped around the face of humanity with the blood sucking tentacle jammed down the throat, or whatever Matt Taibi said, is too funny of line – it trumps all
July 30th, 2009 at 3:47 pm
today i am reminded of those $indu 50 pt drops in a matter of minutes we used to endure.. sometimes there were multiple drops in a row equaling over 100 pt moves.. sometimes it was two steps down and one step up… watching goog and crude volatility the last two days should have everyone wary of a turn… skittish hot money and a lot of it always makes me nervous.
July 30th, 2009 at 3:54 pm
…the last few days sure did feel like a turn was a foot…
July 30th, 2009 at 4:44 pm
@karen: Totally agree. The “nudge-nudge-wink-wink-you first-no-you-first” rally is coming to a close. There will not be nearly enough chairs for those looking for one when the shite hits the fan again.
July 30th, 2009 at 4:47 pm
Excuse me if I rain on the Dow Theory parade, but is the Transports “confirmation” based on the stock price? Because I am not noticing any significant change in actual rail traffic, nor in truck miles driven. Shouldn’t the recovery be based on something tangible instead of stock price. After all, 70% of stocks move together.
I would appreciate it if someone could explain this to me.
July 30th, 2009 at 4:48 pm
@Okie: Don’t be silly. Stock price (with no underlying reason) is all that matters now. Much easier than flipping hard assets like houses.
July 30th, 2009 at 4:50 pm
http://ww2.dowtheoryletters.com/
really old school…
July 30th, 2009 at 4:58 pm
Long volatility?
Would love to hear from some of the seasoned traders on this board concerning insights or reflections on the 99-00 nasdaq
July 30th, 2009 at 5:02 pm
sorry, didn’t mean to send.
nasdaq market. When did you step off the bus? Was Ben callin’ in from class?
Fantasy football is a very worthy and appropriate diversion for this market.
July 30th, 2009 at 5:05 pm
daffy-
sell when Tom Brokaw mentions on the nighly news “how high can the nasdaq go”
July 30th, 2009 at 5:05 pm
Be glad you’re not this guy…..
http://www.news-press.com/article/20090730/NEWS0110/90729077/1075/Downtown-Fort-Myers-condo-has-32-stories-and-one-lonely-tale
July 30th, 2009 at 5:13 pm
…does that mean that he has to pay 100% of the condo maintenance cost?
July 30th, 2009 at 5:26 pm
Re: The analysts and earnings lies, the bloomberg report is right and wrong, it really depends on the item being backed-out. One-time gains on asset sales and things like that should definitely be backed-out. Stock-option expenses, though not cash items, should not be as they are a form of compensation. Like with most things, there is nuance. As an accountant by trade, I’m of the firm belief that its less the analysts and more the accounting standard bodies like the FASB or the the CICA that we have here in Canada that are letting down investors. All we have to do is look to things like the continued blessing of off-balance sheet financing which was prevalent at Enron and was further abused by financial services firms leading up to this crisis.
July 30th, 2009 at 5:42 pm
Speaking of earnings lies, guess what Disney did? Well, you don’t really need to guess, do you?
July 30th, 2009 at 6:49 pm
BR,
to follow up on karen’s rec. from the first “10 link”..
~ don’t limit @10, go for a Baker’s Dozen, or so..
as we know, ‘someone’ else has ridden Top 10, and its ilk, into the Ground..
last I checked, you weren’;t exploring for local Water Tables..
http://news.yahoo.com/s/ap/20090726/ap_on_re_us/us_texas_drought_water
July 30th, 2009 at 7:13 pm
But where I think analysts really suck is this obsession with earnings whether adjusted or as reported. Too much time is devoted to this and not enough to revenue growth, cash flow (especially free cash flow) and balance sheet analysis.
July 30th, 2009 at 8:56 pm
ben! you are 24/7 (just noted your post on the new thread!).. yet another person asked me about how to buy and hold physical gold today.. it’s only just begun, i fear.. wait till people actually start doing it and not just talking about it, lol.
July 30th, 2009 at 9:05 pm
Cohen, i wish i were male so i could just say what i really think about analysts and what they are smoking.. you brot it up really when you said they “suck.” It is the rev growth and cash flow that count.. only the sales managers and sales VPs know what’s in the pipeline. I think it’s fairly clear to most of us that nada is in the pipeline.. hiring is at a near standstill and firing will gain momentum… companies will hire in search of new fire, but the employee base will still wane until growth is on the horizon…
July 30th, 2009 at 11:00 pm
@karen: The sales guy I know at Oracle tells me the mood is grim there because nobody is pulling the trigger on any big upgrades or buying anything new.
July 30th, 2009 at 11:33 pm
You’re right, it’s clear rev growth is poor or non-existent for most companies reporting. Of course, that’s irrelevant as Denis “Beaker” Kneale likes to remind us, in his charming shove-it down your throat manner, 75% of SP5 companies “beat earnings expectations”. I can high-jump a toothpick too, where’s my prize?
July 30th, 2009 at 11:51 pm
Another hilarious and insightful post by Trader Mark:
U.S. Government Makes Strides in Solving Budget Deficit – 0.006% Cost Savings
July 31st, 2009 at 12:02 am
Good read, i persoanlly liked this “If the administration produces $100 million in savings every 98 days for the rest of Mr. Obama’s term, the savings will total $1.5 billion, or three days of interest on the federal debt.”