The stock market has rallied to its highest level all year. But observers point out that Wall Street is getting ahead of economic reality. Karen Brown reports.
Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data, ability to repeat discredited memes, and lack of respect for scientific knowledge. Also, be sure to create straw men and argue against things I have neither said nor even implied. Any irrelevancies you can mention will also be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.
Faced with the choice between changing one's mind and proving that there is no need to do so, almost everyone gets busy on the proof. —John Kenneth Galbraith
Putting aside its incredible product line and pipeline of more, its still attractive valuation relative to earnings, and its $100 per share of cash that may be used for a dividend soon, Apple's stock has gone parabolic. And, parabolic moves always end one way, back to the place where the parabolic move began. Now, AAPL can of course power higher to who knows where in this move but the largest market cap stock in the world has now entered a tenuous phase, strictly technically speaking. But I digress. German investor confidence, the ZEW, in the next 6 months rose back...
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July 28th, 2009 at 5:53 pm
Out of the operating room.**** And getting ready to be wheeled straight back in for terminal treatment. CRE and Alt-A’s and Option Arms, over 5 trillion. If 1.5 trillion did this what the Fu*% do these experts who didn’t see this coming think 5++ trillion will do to it?
Better than expected profits. **** After write-offs and Enron accounting. Watch the banks in the next 6-9 months and remember Enron.
Recession is ending*** By what metric? By the investors are about to get their clock cleaned in a bogus rally?
Unemployment INCHING towards double digits. ****This is as key as the real estate waves that are rolling to shore. The expert who said this knows NOTHING of how unemployment is calculated by the BLS. Unemployment is about 27 million workers out of 150 million. That is 18%. John Williams of Shadow Statistics pegs it at over 20%. These are depression level unemployment numbers. No jobs, no economy. There is NO such thing as a jobless recovery.
July 29th, 2009 at 2:15 pm
The last two recoveries are widely regarded as jobless recoveries. What is the basis for you saying “there is NO such thing as a jobless recovery?” Unemployment is a lagging indicator – wait for it to get better and you will miss the first 100% upleg.
“Recession is ending***By what metric?” The recession ended in June. Look at the ECRI Weekly Leading Index to see what is turning up. June quarter GDP may even be up, although most probably down a little due to the drag from April and part of May. September quarter GDP will be up. That’s the “metric” that counts.
July 30th, 2009 at 11:55 am
Did you see ECRI post on their home price upturn call? Their leading index of home prices has called the bottom they say (www.businesscycle.com has charts).
END OF HOME PRICE DOWNTURN IN SIGHT
“With U.S. home values far below their boom-time highs, most observers are resigned to an indefinite downdraft in home prices. It is this uncertainty about the ultimate bottom in home prices that has converted so many mortgage-related derivatives into toxic assets. Yet, at long last, the end of the home price downturn is in sight.
One key reason for the turnaround in the outlook is housing affordability, which is hovering around all-time highs. The current combination of drastically reduced home prices and very low mortgage rates has hardly ever been seen in living memory…
Most importantly, the U.S. Leading Home Price Index (USLHPI), designed to predict cyclical turns in real home prices, has now been rising for five months… But a three P’s analysis (see chart below) of the level of the USLHPI reveals an even more promising picture… the recent upturn in the USLHPI is almost as pronounced as the median in comparable past cycles… it is almost as pervasive; and … it is just as persistent. The implication is clear: this is a genuine cyclical upturn in the level of the USLHPI. Such an upturn in the USLHPI amounts to a forecast of a cyclical upturn in the level of home prices this year…”