Posts filed under “Markets”

Good News / Bad News

They finally got the Sonofabitch C&%*sucker Zarqawi. About time.

That’s the good news; the bad news is, markets don’t seem to care much; Futures are down pretty significantly, as Japan sold off 3%, with most of Europe down 2%. Crude slipped below $70.

This suggests a few things to me: 

1) The forces in place taking markets lower are beyond the reach of short term news;   
2) Iraq has become such a debacle that the death of a significant scumbag is not that important;
3) The short term swings in the price of Oil, which hasn’t been appreciably below $60 very much for most of the past 2 months, is less significant to markets than previously believed.

Today will be interesting — watch for rally attempts in the futures pit, and a shot at reversing the sell off intraday.


UPDATE JUNE 8, 2006 7:32am

I hadn’t seen anyone discuss this, but the Bovespa in Brazil got shellacked yesterday — The ETF was  whacked 4.15% . . .

Category: Markets, Psychology, War/Defense

Is Willful Ignorance an Investment Strategy?

Category: Economy, Investing, Markets, Psychology, Technical Analysis

Bounce, Test, Bounce . . .

Category: Investing, Markets, Technical Analysis, Trading

NFP stinks — and Some People Still Don’t Get It

Today’s NFP number stunk the joint up: 75,000. That’s half of the monthly population growth, meaning the percentage of people working (relative to pop) actually went down, if we are to believe this data. 

Astonishingly, some people STILL do not understand the data or the context of the weak job growth within this recovery. To wit, my friend Cody Willard – a telecom strategist – writes:

"Surely, Barry, you’re not seriously trying to rekindle your argument about "job creation is not what it is typically at this phase of a recovery."

That statement has been a cornerstone of your bearish rants for the last couple years. Yes, I know you’ve been a "trading bull" and what not, and rightly so, but this economic argument of yours has been, in my view at least, wrong for the last few years and now that job creation is finally starting to slow — years after your repeated flagging of how this "recovery" (You still call this a "recovery" btw?)"

Ahhh, poor Cody. He is lost in a sea of data, unable to see the truth. He believes the spin.

Rekindle? Just because you close your eyes, the boogie man doesn’t disappear.

Hey Cody, please cite me some data revealing this to be an above-average private sector jobs creation recovery. Hell, I’ll take average.

You won’t, because you cannot.

Cody is engaging in several analytical foibles, but the best way to describe it is "ignore reality." But his subjective error does not change the objective reality for the rest of us: By any honest measure – e.g., NY Federal Reserve or Cleveland Federal Reserve research — this has been the worst modern jobs recovery on record.

This is not a meme I am pushing or a Bear story I fabricated.

It just “is.”

This doesn’t mean you run out and short everything; as I wrote last December, one should Never Confuse Economic Analysis With Trading.

But comprehending the reality of the economic situation is important. Why does this matter?  What Cody fails to consider is the importance of understanding the specifics of how a recovery comes about, and how it compares to prior recoveries. What it means as the massive government stimulus that goosed the economy begins to fade. What happens when the Pig is finally thought the Python?

I expect that as we begin to slow, there ain’t a whole lot of fat to get sliced. As unemployment starts ticking up, it will not be pretty. It suggests the next recession will be more severe than the last one. 

Yes, Virginia, there is inflation. And yes, Cody, this has been the worst Jobs recovery since WWII. But if you want to believe in Santa, who am I to disabuse you of that notion?


UPDATE:  June 2, 2006: 12: 47pm

Cody and I finish the debate below


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Category: Economy, Employment, Inflation, Markets, Psychology

Apprenticed Investor: 10 Lessons Learned in the Selloff

Category: Apprenticed Investor, Economy, Investing, Markets, Psychology, Technical Analysis

Blame the Fed?

Category: Federal Reserve, Investing, Markets, Psychology, Trading

Will Cheap Stocks Get Cheaper?

Category: Data Analysis, Earnings, Investing, Markets, Trading

Download Arbitrage with eMusic

Category: Markets, Music, Trading

How Cheap is the Market?

Category: Apprenticed Investor, Data Analysis, Earnings, Investing, Markets, Psychology

Pick the Bubble: S&P500 or CRB?

Category: Commodities, Investing, Markets, Psychology, Technical Analysis