Down goes the Dow

Uh, you're talking to yourself.

Pointing Out the Obvious wrote:

Pointing Out the Obvious wrote:

Anyone with no gains for the year is at the least incompetent if not brain dead.

You managed the brain dead part before the year even began.

Yo Brain Dead Boy. How goes?

Maserati wrote:

Dow closes the week at 16,413, down 159.8 or 1.0% on the day.

Just like the previous equaling of the high, to me this means nothing other than no gains yet for the year.

I'm up around 1.8%. ytd as of the close on Friday.

Last week hit me pretty hard.

Orang Pendek wrote:

fisky wrote:

This could be a market top and bull trend reversal, at least for the next few weeks.

I betting you're wrong.

The key words are "the next few weeks". We had a key reversal on Friday, which is a major short term trend reversal and one of the few chart patterns that actually means anything.

If you go back to May 22 last year, you can see that I called a short term top on the day, from the same kind of chart pattern, but the total movement was about 5% down (oh, but nobody can time the market at all, right?). You know what happened overall after K5 made that call of a top.

These things are not 100% accurate, and any one can be wrong, but it wouldn't surprise me to see some kind of correction from here, as the broad market has clearly run out of momentum this year. But the key is that corporate profits have not topped, and you are not going to get any meaningful reversal until after that happens. The primary trend is still up until something significant in the fundamentals changes:

We'll know more after the earnings reports next week.

Monday morning interim update:

DJIA down .4%

NASDAQ down .2%

Still lots of fiddle-faddle, still not regretting not being in equities at the moment (except for a small bit).

Randy Oldman wrote:

We'll know more after the earnings reports next week.

this reminded me of a little known issue about stock market investing- I read somewhere that the market's course is essentially not correlated to company earnings.

I think the paper's findings was that interest rates were the most important factor, but I don't remember the details.

Just funny that what seems to be the most important factor - how much money the companies are making - is a small factor is determing the direction of the stock market.

If I am remembering correctly the paper's findings.

Any idea why Google is down over 1%?

agip wrote:

Randy Oldman wrote:

We'll know more after the earnings reports next week.

this reminded me of a little known issue about stock market investing- I read somewhere that the market's course is essentially not correlated to company earnings.

I think the paper's findings was that interest rates were the most important factor, but I don't remember the details.

Just funny that what seems to be the most important factor - how much money the companies are making - is a small factor is determing the direction of the stock market.

If I am remembering correctly the paper's findings.

I think you're right in the long-term.

Google is long overdue for a correction. It's moved up pretty steadily since Jun 2012, nearly doubling in price.

A much better question should be "where is Google's price going from here? A cursory examination hints that it might be going down to test the 200 day moving average (currently at 510). It's successfully bounced off the 200 DMA twice in the past couple of years.

http://scharts.co/PFQYaL

Mid-morning, the slide continues, now down 0.6-0.7% on the day.

Also when I was talking about gains I was talking about post-tax inflation adjusted gains.

Still not significant IMHO.

Companies across America are blaming the brutal winter for weak first-quarter results, but investors are expecting a quick rebound in the second quarter and will likely judge harshly companies that are less optimistic about a recovery.

The ice, snow and freezing temperatures kept consumers out of stores, grounded planes and snarled transportation, and raised heating costs for businesses and homes alike in the first three months of the year. Weather was mentioned in 219 S&P 500 earnings conference calls between Jan. 1 and April 1, compared with just 125 in the first three months of 2013.

Investors in the past have generally cast a jaundiced eye at companies that blame the weather for poor results, but this winter was different.

"The truth is the weather did really hurt things," said Randy Warren, chief investment officer of Warren Financial Service in Exton, Pennsylvania.

So "people will be really looking for the guidance this time to see whether the CEOs are going to tell us that they've already seen a pickup, a spring thaw."

Recent data on U.S. auto sales and housing activity have suggest a snapback from the weak weather. Economists at Bank of America/Merrill Lynch forecast the U.S. economy will grow between 3 and 3.5 percent in the next three quarters, noting increased small business hiring intentions and a stronger outlook for capital expenditures.

That would be an improvement from median forecasts for 1.9 percent growth in the first quarter.

Randy Oldman wrote:

agip wrote:

this reminded me of a little known issue about stock market investing- I read somewhere that the market's course is essentially not correlated to company earnings.

I think the paper's findings was that interest rates were the most important factor, but I don't remember the details.

Just funny that what seems to be the most important factor - how much money the companies are making - is a small factor is determing the direction of the stock market.

If I am remembering correctly the paper's findings.

I think you're right in the long-term.

By this you mean that in the long run we are all dead?

In the long term stock market returns have to be closely correlated with company earnings. Without this, it is a mathematical certainty that the market's PE would gravitate toward 0.0 or infinite.

In the short term interest rates are certainly the primary driving factor. But I thought that this was well understood.

Bigfoot Investments wrote:

Randy Oldman wrote:

I think you're right in the long-term.

By this you mean that in the long run we are all dead?

In the long term stock market returns have to be closely correlated with company earnings. Without this, it is a mathematical certainty that the market's PE would gravitate toward 0.0 or infinite.

In the short term interest rates are certainly the primary driving factor. But I thought that this was well understood.

Consumer confidence, retail sales, housing starts, GDP growth, inflation, monetary and fiscal policy and other factors are early indicators of future company earnings.

Pointing Out the Obvious wrote:

Could he be more wrong? wrote:

Posted March 29...

Meanwhile at the end of "next week"...

Hard to believe that's the real K55 (K5). The real K55 appears to be a bright, if troubled, fellow and not prone to making specific predictions for a particular week.

I'm calling imposter.

Quite a slide last Friday followed by another one today.

That imposter may have been correct when he predicted that a downward slide larger than a correction would begin last week

"The ice, snow and freezing temperatures kept consumers out of stores, grounded planes and snarled transportation, and raised heating costs for businesses and homes alike in the first three months of the year."

Therefore, online retailers, salt providers, brush and shovel suppliers, ground transportation, extremely local businesses, towing and recovery, and heating fuel suppliers must all be doing great.

That simplistic logic works neither way. All sorts of morons are looking for an escape hatch.

Yes, there's a huge market in salt and shovel supplies, almost eclipsing the motor industry.

You mean like the 4wd/light truck/SUV component of the motor industry, which vehicles have superior performance in the kind of conditions just experienced, not to mention the winterizing/repair/auto parts components of the motor industry, who have had booming business due to recent conditions?

Now down 0.9-1.0% on the day for Monday.

How are your Vanguards doing agip?

Again, IMO this isn't yet significant one way or another, but still presents no particular reason to be in the market at the moment.