Equities Archive

Hussman view of equity valuation

What’s new here is somehow Hussman has picked on the idea that corporate profits fall as the federal deficit falls. He stops short of suggesting we need a higher federal deficit, of course. After all his endless inane out of paradigm raving against federal deficits it might take him a few months ...Read More

Fed minutes, comments on full text

Comments in below and highlights mine: Developments in Financial Markets and the Federal Reserve’s Balance Sheet The Manager of the System Open Market Account reported on developments in domestic and foreign financial markets as well as the System open market operations during the period since the Federal Open Market Committee (FOMC) met ...Read More

Michigan survey and a small rant

Funny how sentiment follows stocks… And how housing has gone flat all year is dismissed. Not to forget jobless claims are about people losing their jobs and not about anyone getting a job. Yes, claims have correlated to new jobs, but that’s a different matter. For example, ‘at the limit’, you could ...Read More

taper tantrum!

The low jobless claims number seem to have sent markets into full taper mode. Stocks down due to fears of what happens without the presumed Fed support, and bonds higher in yield due to fears of what happens when the Fed slows down purchases. And so while the ‘better jobs’ outlook that’s ...Read More

corp profits and the federal deficit

Funny how little attention, if any, is focused on how corporate profits are a function of federal deficit spending? Ideology conflicts? Nothing ‘new’ about the idea that deficit spending and profits are related: Kalecki’s most famous contribution is his profit equation. In this model total profits (net taxes this time) are the ...Read More

stocks and the fed

Nothing short of a perceived ‘collapse’ in equity prices is likely to dislodge the Fed. They don’t target stocks, but the way I like to think about it is they are intimidated by them. ...Read More

IPO’s and demand

New issues are, functionally, credit expansion, and support GDP to the extent the funds are spent on real goods and services. But note that the US housing agencies are turning over their profits of about the same $5 billion/mo to the Treasury, which works against GDP, to the extent those funds would ...Read More

US equity funds see highest-ever inflows in July

This kind of flow could drive even Lehman Bros. and Bear Stearns stock prices to new highs: US equity funds see highest-ever inflows in July By Ansuya Harjani August 4 (CNBC) &#8212 U.S. equity funds saw a record inflow of $40.3 billion in July, according to data from TrimTabs, as the S&P ...Read More

profits up, sales down

Good for stocks, bad for people theme: Renault SA, France’s second-biggest carmaker, last week reported unexpected growth in first-half profit as labor-cost cuts and higher vehicle prices more than offset slumping sales. Paris-based Alcatel-Lucent SA today reported second-quarter earnings that topped analysts’ estimates. ...Read More

stocks bonds qe dynamics

Until markets recognize QE for the tax that it actually is, the QE policy is stabilizing for stocks, destabilizing for bonds. For example, good economic news is fundamentally good for stocks, but means QE may end, so the effects are offsetting. Same with bad economic news. Fundamentally bad, but means QE continues, ...Read More