Market Montage
Stock Market, Economics, Equity Analysis
Jul16
After six consecutive losing sessions the market was due for a bounce and certainly received it Friday. Essentially the news story of the day was "good enough" – i.e. China was good enough, and JPMorgan ex-fraud was good enough. Wells Fargo did not get much attention but also posted good results, with a nice uptick in mortgages. This company now originates one out of every three mortgages in America which is a remarkable concentration of power. TBTF. …
Jul13
The two big events for this morning were Chinese GDP and JPM's earnings. These investment banks are huge black boxes with so many levers being pulled, so how anyone can analyze these companies is beyond me – but we discovered today that apparently someone in the company was taking "mark to market" to a whole different level. Indeed to a level of fraud. Considering this is the "most respected investment bank on the planet" one can only wonder what is going on elsewhere. It also speaks to a lack of internal controls and the whole idea that in less liquid instruments the pricing is far more "arbitrary" than say in a stock. …
Jul12
Quite an astounding chart via WSJ Marketblog on Q2 earning expectations of the S&P 500 from Jul 1, 2011 to today. The chart shows the expectation in 3 month increments and what was once a +14% year over year profit growth expectation shrunk to +8% then +4% then +1.7% and now -2.1%. Which of course will be trumpeted anytime a company "beats expectations". …
Jul12
I read in the twittersphere that the market has rallied in the last hour 9 of the past 10 sessions. This despite the last 5 being down days. Those late day spikes do a good job of keeping bears on their toes and hesitant to push their bets as almost all the gains of the past 3-4 months have come via overnight gap ups. Of course, the market likes to frustrate as many as it can and sometimes the late day squeezes such as yesterday shake out bears just in time for a substantial gap down. Which looks like the course of action today. …
Jul11
While the technical definition of recession commonly used is negative GDP two quarters in a row, it is actually something far less simple.
ECRI has been calling for recession for a few quarters now and with the data coming in, it is looking more accurate now – especially if you use the definition on the NBER website: …
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