So sorry....
So sorry....
[quote]Ghost of Igloi wrote:
Econ,
In regards to projections of ten year equity returns it is a point I have debated here for over a year. Today, at a point near a market peak the sixteen year S&P 500 return is about 4%.
/quote]
Here's another great example. You mention 10 year returns, then spout the 16 year number. Why not 10 years? Or 5? Because they don't fit your narritive. Do you really think readers don't see through your deception?
If you listen carefully you can hear the dollars screaming out of Europe into New York. In the evening it is sort of a low hum, but sometimes elevates to a roar.
Sally V,
I suppose you don't like my numbers because they don't fit your narrative. By the way the best performing asset class is high quality bonds. The iShares 20+ Treasury Bond ETF is up 18% year-to-date.
Igy
....dollars screaming out of Europe....in the evening it is sort of a low hum, but sometimes elevates to a roar...flowing like a river into Maserati's pockets......
Tweet from John Hussman:
"During "risk on" phase of QE, financials among strongest sectors. This is something different. Investors seeking shelter outside bank system"
Igy
More Hussman Tweets:
"European banks breaking 2009 lows, $10Tn in negative yielding bonds, but sure, this is just a normal, healthy market"
Joe Beets wrote:
Just avoid investing in Europe. It's really that simple.
Ahem....
Ghost of Igloi wrote:
Sally V,
I suppose you don't like my numbers because they don't fit your narrative.
Igy
First, I don't have a narrative. Second, I am objective and realize that there are multiple sides to this story. You have tunnel vision and a bad case of confirmation bias.
I hope it's not contagious.....
It's not. Most people are capable of objectivity and rational thought. You are the exception.
Sally V,
OK. Since you are a member of the rational, explain why the S&P 500 is near record highs when:
1. S&P 500 earnings per share have fallen 18% over the past eighteen months
2. Stock buybacks are at record high levels, margin debt at record levels
3. S&P 500 Last Twelve Month quarterly PE ratios highest in six and a half years
4. Over the past year these indices or ETF are negative: NASDAQ -2.66%, Russell 2000 -7.99%, iShares MSCI EAFE ETF -12.84%, iShares MSCI ACWI ETF -5.75%, ISahres MSCI EM ETF -12.44%, Alerian MLP Index -20.39%
5. Over the past year these indices are positive: Dow Jones Industrial Average +1.33%, S&P 500 +1.50%, IShares Core US Aggregate Bond ETF +4.13%
6. Global bond yields at historic lows, the 50 year Suisse Bond at a negative yield, the US 10 Year Treasury is at 1.39% (hit a record low yield earlier today)
Of course one can say everything is awesome, like-a, ya know....
Igy
That one's easy. The markets are FORWARD looking.
Econ,
That is such an overused and inaccurate explanation. Your forward looking market has year out earnings non-GAAP S&P 500 EPS at $125. Yet Last Twelve Months non-GAAP EPS came in at $98. Wall Street projections for Q2 S&P 500 earnings of down 5%. So that forward looking market is so much hokum. Where was the forward looking market in March of 2000 and October 2007? You need to retake Econ 101.
Igy
It's not inaccurate at all. It's used a lot because it is exactly how it works. You sound foolish by denying it.
Econ,
So we should rely on a Ouija Board indicator for investment decisions rather data? I sound foolish but you have no answer for why your indicator did not predict the declines of 2000-2002 or 2007-2009. Perhaps since the S&P 500 is up only 1.5% it is predicting something you won't be happy with. Perhaps you sound foolish.
Igy
Silence is Golden, Golden....
GLD up 13% over the past year? A forward indicator of further gains according to Econ 101, or perhaps that is an exception to the rule?
Igy
What are you talking about? You asked why the market was where it is despite recent historical data. I told you why. Investors decide the prices based on what they believe a stock is worth based on where the company is heading. That is Econ 101, day 1. If you don't like the price, don't buy. It's simple. No one is forcing you to invest in any company that you don't believe will be worth what you'd pay.
Econ,
OK. Do you consider large institutional money managers investors? If so, what is the time horizon of their "investments?" You won't find the answer to this in your Econ 101 textbook.
Igy
Econ,
Here is the answer:
Institutional, high frequency traders, are the volume of the market. These are largely short term trades. So the "wisdom" of the market cares very little about stock prices, values or earnings. It is a directional daily bet on what's working now.
Hey believe what you want.
Igy