We recently learned sales for this year’s Black Friday weekend declined for the first time since 2009. I have been warning my readers for months that falling consumer confidence would result in a pullback in consumer spending—and that’s...
Bear's Lair
Bear Markets always follow Bull markets and a severe stock market correction is long overdue. Bears Lair will spot, monitor and analyze the stock market correction as it develops.
A couple of weeks ago we looked at a recent cover of Barron’s, which featured a picture of a giant bubble. The cover story asked the rhetorical question of whether there was a bubble in the financial market. Indeed, the bubble...
On December 29, 1989 a massive inflationary bubble began to pop in Japan. As prices dropped, investors with cash sat on their wallets waiting for lower equity prices. The desire to “get out” became much stronger than the desire to “get...
Every once in a while someone summarizes the big picture in a simple way. Bill Gross of PIMCO noted the following in his most recent investment outlook: Don’t fight central banks, but be afraid. Why is this statement so relevant? The...
The market makes most of its gains each year in its favorable season of approximately October to May. A separate positive influence is the Federal Reserve when it’s providing easy money and low interest rates in an effort to revive a...
The table below puts some context around the impact of the Fed’s bond buying program. It tells us several billion dollars of freshly printed money will be pumped into the global financial system this week. The Fed’s actions greatly...
It’s been several months since we took an indepth look at some of the more important currencies in the world. In this Weekend Report I would like to show you some important developments that have taken place that could be signalling a...
In 2008 market and economic participants suffered a hard downside ‘gap’ in the prices of their assets and in the levels of their expectations. The bull market that began in March of 2009 is doing a fine job of closing that gap and...
The good news is: The small cap indices led the way up last week. The negatives: There are not any serious negatives. New highs have not been great, but, they have not been terrible. The secondaries have been lagging, but, they picked...
Gold and silver have a 6000 year history for their use as a currency, and until the last century, the price of gold and silver maintained a healthy valuation ratio of 1 ounce of gold to every 15 ounces of silver.
With some better than expected economic news to digest, the S&P 500 was up 5 points early in the pre-holiday session, which added to the bullish list of things to be thankful for.
The fundamental backdrop behind the ramp higher in equity prices in 2013 is far from inspiring. However, fundamentals do not matter when the Federal Reserve is flooding U.S. financial markets with an ocean of freshly printed fiat...
In recent weeks, we have covered numerous misconceptions relative to rally killers: Stocks cannot continue to rise with PE ratios elevated. Rallies not led by financials are doomed. Investors have reached a euphoric state. Bubbles end...
If you have been around the financial markets for any length of time, you are familiar with the expressiondon’t fight the Fed. The corollary is don’t fight global central banks when they are injecting new cash into the global financial...
The money supply as measured by M2 is now rising at a 12.1% annualized rate, which is causing the fickle Fed to renew its threats about ending QE. The minutes released from the latest FOMC meeting indicate the tapering of asset...
The good news is: The NASDAQ composite (OTC) closed at a multi year high on Friday and the rest of the major indices closed at all time highs. The negatives: New highs picked up at the end of last week, but remain well below levels...
Many regard the risk of inflation as low, since the Fed’s money distribution or credit mechanism is limited by how the banks decide to lend. While credit worthy businesses and consumers are still de-leveraging, the transmission...
When we say markets are manipulated, we do not mean in an Area 51/government conspiracy manner. Any government intervention into any market distorts asset prices. For example, a tax credit for new home buyers impacts (distorts/...
Ben Bernanke provided some clarity to the recent confusion surrounding the Fed’s QE stimulus program. He indicated on Tuesday that the near-zero Fed Funds rate will likely remain at that level long after ending asset purchases under...
As usual we are hearing many claims regarding market valuation, mostly that stocks are undervalued based upon future earnings projections. We are also seeing a lot of headlines about stocks being in a bubble. Using twelve-month trailing...
The minutes of the Fed’s last FOMC meeting, released this week, confirm that the Fed believes it must begin to taper back its stimulus soon. At this point, the longer QE continues the greater the risk of asset bubbles forming, the...
On Wednesday, the Fed minutes hinted at tapering in the months ahead. The stock market sold off on the news. Less than 24 hours later, a tame report on inflation pushed the markets back into “taper later” mode.
Looking at the chart of silver from today’s point of view, we see that at the end of the previous week, the white metal (similarly to gold) moved higher after Federal Reserve Chair Nominee Janet Yellen told that monetary stimulus tools...
Professional historian, author and college professor, Ryan Jordan, Ph.D. sees silver fundamentals from the perspective of a historian and as an astute observer of present conditions. He studies the drivers of the silver market, supply,...
Healthy and sustainable bull markets tend to lift all equity boats around the globe. As shown in the chart of the China ETF below (FXI), Chinese stocks struggled for the first six months of 2013. Last week’s major announcement from...
The central banks of Japan and the U.S. are killing the private market for government debt. The massive and unprecedented bon-buying programs for Japanese Government Bonds (JGBs) and Treasuries have driven yields so low that investors...
The big news that has somehow shocked the media is that the BLS was caught fudging the jobs numbers going into the 2012 election.
Senator Dean Heller: “A quick question about quantitative easing: Do you see it causing an equity bubble in today’s stock market?” Yellen: “I mean, stock prices have risen pretty robustly. But I think that if you look at traditional...
Based on the monthly figures to 1st October recently released by the St Louis Fed, FMQ jumped $227bn in September to $12,176bn. This puts it $4,819bn and 65% over the long-term exponential trend established between 1960 and July 2008,...
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