The Dow Jones is only about 1,100 off its all time high. I think we will easily get that by year-end. It was just 14 years ago (2009) when the S & P was around $600. Who would have thought back then that it would be around $4,600 today? I could see it finishing the year maybe breaking the $5,000 barrier.
I don’t usually see S&P level preceded by a $. Just a straight up number. Is that legit?
it's true that macro measures of liquidity show increased liquidity.
Why an investor would want to bet against that helping stocks is a good question though.
Here's one good measure of liquidity, and it is suggesting loosening conditions despite a recent banking crisis, high rates and a shrinking Fed balance sheet. Remarkable.
The Government continues to spend recklessly as if this has no consequences.
“Two different rigorous studies, one completed in 2011 and the other in 2012, each using different methodologies, both concluded government fiscal policy actions that either increase the size of government relative to GDP or increase the government debt relative to GDP significantly weaken the trend rate of economic growth. The evidence, from more than a decade, since this research was published, confirms those findings and indicates that the government multiplier is becoming increasingly negative.”
I put in @ $26k a couple of weeks ago. Some real big ups and some minow downs and it had grown to @ $62k by last Tuesday. Downs on Wed and Thurs -- then a death spiral Friday.
I got out after an hour or so on Friday and preserved about $20k of the gain I had earlier seen. Downward spiral continued on Friday and down 20% today.
No manipulation of course. Just the free market at work.
This post was edited 1 minute after it was posted.
I put in @ $26k a couple of weeks ago. Some real big ups and some minow downs and it had grown to @ $62k by last Tuesday. Downs on Wed and Thurs -- then a death spiral Friday.
I got out after an hour or so on Friday and preserved about $20k of the gain I had earlier seen. Downward spiral continued on Friday and down 20% today.
No manipulation of course. Just the free market at work.
yeah you know what... micro cap biotech stocks with a tiny $46 million market cap and 67 employees are not the true test of markets.
July has recently been the best month for markets. Up 10 of the last 11 years.
In 2023 July was up a very strong 3.6% in the US.
August and September look like the two of the worst months! Ruh roh!
Ryan Detrick, CMT @RyanDetrick Over the past 10 years, stocks have been higher 9 times in July. Also, this month has the best average return out of all 12 months.
5:30 PM · Jun 25, 2023 · 46.5K Views
Over the past 10 years, stocks have been higher 9 times in July.
July has recently been the best month for markets. Up 10 of the last 11 years.
In 2023 July was up a very strong 3.6% in the US.
August and September look like the two of the worst months! Ruh roh!
Ryan Detrick, CMT @RyanDetrick Over the past 10 years, stocks have been higher 9 times in July. Also, this month has the best average return out of all 12 months.
Reminder that earlier in the year Igy said the S&P 500 would be at or near 3,000 by year's end.
At the close on the last day of July, the S&P 500 stood at 4,589, UP from where it stood at 3,991 when Igy made his prediction.
Things to note:
1) I am keeping track of this ONLY because Igy pushed back hard against me calling him a permabear and because he told agip to bookmark his prediction for later (showing how confident he was in his pronouncement).
2) I do not claim to know how the stock market or any specific index will rise or fall in any given short time frame (less than a year is a short time frame). Also, I did not claim on Igy's pronouncement day that he would be wrong.
3) NO ONE, not me, not Igy, not Warren Buffett should declare with the level of certainty that Igy did on this ocassion (and many others) how the stock market will behave over a short period of time. Anyone who does so and gets it right is simply the beneficiary of coincidence. Markets are unpredictable over short time periods and can be affected by so many things...war, unexpected good or bad economic news, government meddling.
So, will the S&P 500 sink to 3,000 by year's end? Time will tell.
Reminder that earlier in the year Igy said the S&P 500 would be at or near 3,000 by year's end.
At the close on the last day of July, the S&P 500 stood at 4,589, UP from where it stood at 3,991 when Igy made his prediction.
Things to note:
1) I am keeping track of this ONLY because Igy pushed back hard against me calling him a permabear and because he told agip to bookmark his prediction for later (showing how confident he was in his pronouncement).
2) I do not claim to know how the stock market or any specific index will rise or fall in any given short time frame (less than a year is a short time frame). Also, I did not claim on Igy's pronouncement day that he would be wrong.
3) NO ONE, not me, not Igy, not Warren Buffett should declare with the level of certainty that Igy did on this ocassion (and many others) how the stock market will behave over a short period of time. Anyone who does so and gets it right is simply the beneficiary of coincidence. Markets are unpredictable over short time periods and can be affected by so many things...war, unexpected good or bad economic news, government meddling.
So, will the S&P 500 sink to 3,000 by year's end? Time will tell.
Flagpole or anyone else can refer to my comments as predictions if they like. I did not push back hard on his perma-bear comment any more than this is a hard push back. My comments generally are directed toward valuation of the market, which historically has been a reliable predictor of long term returns. The historical GAAP multiple of the S&P 500 is around 16. Flagpole and others talk often about historical returns in the market, but ignore or discount valuation; the math of price of the market divided by GAAP EPS of the market. In this case, the S&P 500 being a proxy for the market.
At Friday's close, the second to last day of trading in July, 52% of S&P 500 companies have reported for Q2, with GAAP EPS tracking at $178.76 on a previous 52 week basis. So up from the year end 2022 figure of $172.75 when the index closed under 4,000. Currently Wall Street is projecting GAAP EPS closes the year at $197.85, a huge move from here. Even at a level of 4,800 S&P 500 the multiple would be a rich 24.26.
One can ignore the $1.2 Trillion added to the debt since Congress raised the Debt Ceiling. Or, four bank failures, with one just a few days ago. Or, the 5,000 employees to be laid off at CVS Pharmacy. Or, the collapse in commercial real estate. Or, the collapse in crypto and meme stocks. OR, most of the gains concentrated in less than two handfuls of stock that comprise 30% of the index. Or, The Fitch downgrade of United State Treasury debt.
In summary, unlike Flagpole's blind faith in the market, the $8 Trillion in Fed and Government stimulus since March 2020 has created one of the great financial bubbles in history. The stock market, bond market, and residential real estate are all at historically elevated valuations, distorted by deranged government intervention. In my view, the government intervention by Treasury and the Fed to stave off the regional bank collapse encouraged another level of speculation, so the timing of the collapse in asset prices is just put off, not avoided. I believe 2023 will end with S&P 500 EPS around 180, with a 16 multiple would put fair value at 2,880.
Agip, if you would be so kind, please bookmark this. :-)
"We estimate the Fed is insolvent in an amount close to $2 Tn. This loss can be expected to be recovered over time, as the Fed retains interest that would otherwise have been remitted for public benefit."
By relentlessly depriving investors of risk-free return, the Fed has spawned an all-asset financial bubble that now offers return-free risk. Whatever y'all think you're doing here, it's not "investment."
$33 trillion in debt and growing $2 trillion per year. $1 trillion annual debt service to pay interest and rising. 18% of tax revenue. Probably $100 trillion in unfunded liabilities.
Reminder that earlier in the year Igy said the S&P 500 would be at or near 3,000 by year's end.
At the close on the last day of July, the S&P 500 stood at 4,589, UP from where it stood at 3,991 when Igy made his prediction.
Things to note:
1) I am keeping track of this ONLY because Igy pushed back hard against me calling him a permabear and because he told agip to bookmark his prediction for later (showing how confident he was in his pronouncement).
2) I do not claim to know how the stock market or any specific index will rise or fall in any given short time frame (less than a year is a short time frame). Also, I did not claim on Igy's pronouncement day that he would be wrong.
3) NO ONE, not me, not Igy, not Warren Buffett should declare with the level of certainty that Igy did on this ocassion (and many others) how the stock market will behave over a short period of time. Anyone who does so and gets it right is simply the beneficiary of coincidence. Markets are unpredictable over short time periods and can be affected by so many things...war, unexpected good or bad economic news, government meddling.
So, will the S&P 500 sink to 3,000 by year's end? Time will tell.
Flagpole or anyone else can refer to my comments as predictions if they like. I did not push back hard on his perma-bear comment any more than this is a hard push back. My comments generally are directed toward valuation of the market, which historically has been a reliable predictor of long term returns. The historical GAAP multiple of the S&P 500 is around 16. Flagpole and others talk often about historical returns in the market, but ignore or discount valuation; the math of price of the market divided by GAAP EPS of the market. In this case, the S&P 500 being a proxy for the market.
Igy, I think the overwhelming majority of intelligent readers here realize that your posts are the work of a consummate troll. Well done, sir.
Hard to get worse than this prediction of a global deflationary bust and stock market crash. ALthough if you read the comments he seems to be saying we'd have a big stock rally first, because of the falling rates, then stocks would fall 80%. So we're in the big rally portion now? Despite *higher* rates?
Anyway, global stocks are up 12% since then, and he was wrong on bonds, as the rate on the US 10 year has risen, not fallen, to 4% from 2.8% when he wrote that.
From 8/1/22
June was a major bottom in the bond market similar to 2014 & 2018.Bonds are set up for a big,steep rally that takes the 10yr to 0% & lower & the 30yr to 1/4%-1/2% next year.A global deflationary bust & historic financial crisis is coming in 2023.Bonds likely correct here first.
A year ago Mike Wilson at MS said bonds would outperform stocks.
The result is in:
Stocks: +13%
Bonds: -4%
Wilson probably gets paid what...$600k a year? More?
Morgan Stanley's Mike Wilson:
📢 We don't see an economic bottom 📢 Derating may be complete, but forward EPS cuts aren't 📢 Remain defensive, bonds likely outperform stocks$SPY$QQQ$TLT$SPXpic.twitter.com/nzkimZSJ0M
