60 Minutes on the Explosion of Disability Enrollees

60 Minutes this past Sunday did a piece on a story that has been talked about in these pages for a long time – the rapid increase in disability enrollment since the recession half a decade ago.  It is quite remarkable that effectively 5% of the working population is now enrolled. [Apr 7, 2011: Nearly 1 in 20 Working Age Americans Are on Disability, a Doubling Versus 1990]  [Dec…

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WSJ's Hilsenrath on Janet Yellen

With the demise of Larry Summers, all eyes point to Janet Yellen as the next Federal Reserve head.  Frankly it is a bit surprising she was not the leading candidate all along.   Earlier this year, we posted a NY Times piece on the woman [Apr 25, 2013: NY Times Does Janet Yellen] from a more personal level and now we have one on the Fed whisperer himself, Jon Hilsenrath…

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The Most Overbought Point in 2013

Quite an explosive rally yesterday at the 2 PM mark, in fact about 70% of yesterday's gains came in a minute or so per Bespoke Investment; the power of algos.   Obviously the Fed, by surprising just about everyone with "no taper at all", lit another fire under the market but coming off a near vertical rally since late August it is still a bit surprising to see the…

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Launch of Paladin Long Short Fund (PALFX)

Hanna Capital is proud to announce the launch of its flagship fund, the Paladin Long Short Fund (PALFX).  Available through a variety of brokers as well as direct purchase, this no-load fund seeks capital appreciation.  See the fund's prospectus here. Distributor: Capital Investment Group, Inc., Member FINRA/SIPC , 17 Glenwood Ave, Raleigh, NC 27603, (800) 773-3863.  There is no affiliation between Hanna Capital LLC, including its principals, and Capital Investment Group, Inc….

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Apr02

Some quick data via CNBC on what happens after at least a 8% gain in Q1 since 1950. There have been 13 instances since 1950.  In all but the crash year of 1987, the market ended higher for the year from where it ended in March.   Obviously the pace tends to moderate. :)

Even in 87, the market ended the year in positive territory, despite giving back most of the Q1 gain.

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Apr02

A decent report out of ISM on the manufacturing report with a headline number of 53.4 versus 53; the sub-indexes were mixed with new orders down 0.4, employment up 2.9, and prices paid down 0.5.  (Totally separate the construction report was quite poor but most eyes will focus on ISM)

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Apr02

Futures were sharply higher overnight on the Chinese data, but Europe came in this morning with a big thud as their PMI contracted for the 8th straight month.  The U.K. was a bright spot amongst the "Big 3".

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Apr01

This chart from Yardeni Research is a few weeks old but the market has mostly gone sideways to slighty up since up since; I've seen some updated charts since which essentially are identical.  It raises the question of do we simply not fight the Fed during their unconvential actions.  Below we see the stock market action in blue shade during QE1, QE2 (please note the vertical line that designates when Bernanke gave the "all clear for QE2" signal at Jackson Hole, WY in August 2010), and Operation Twist.  When those operations were not in full swing the market fell from 9-11%.  That contrasts with double digit gains of anywhere from ~15 to 35% when the Fed is easing.  Is it really that simple?

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Apr01

The multi year 0%ish Fed funds yield plan has had many outsize effects, not the least of which is a massive transfer of wealth from savers to debtors.  Those savers, many usually a very conservative bunch, have been desperate to pick up any sort of meaningful yield to keep ahead of inflation – or to reach those promised annual return assumptions of 7%+ if you are a pension fund.  As Treasury bond rates have swooned, so have corporate bond rates – both at the high end and at the low end of quality as economics 101 kicks in.  As demand swamps supply, prices go up – which in the bond market means yield goes down.  

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