|
Date |
Report |
Title |
|
December 29,
2006 |
InterMarket
Forecaster |
The InterMarket Forecaster |
|
December 22,
2006 |
Investment
Focus |
How
Valuation Can Mitigate Otherwise Warranted Bearishness
Historically, an inverted Treasury yield curve (which we’ve
had since last July) has spelled trouble for the year-ahead
performance of U.S. equities and the U.S. economic growth
rate. But while we now expect... |
|
December 15,
2006 |
Investment
Focus |
Is the
Housing Sector Predictive?
As we expected, the U.S. residential housing sector
performed badly this year. Whether we consult the data on
new home construction permits, housing starts, old and new
home sales, median house prices, real residential investment
spending or the performance of homebuilder stocks relative
to the S&P 500, we find that the news this year has been
uniformly grim. But does the housing sector’s performance
over the past year have any predictive value? |
|
December 7,
2006 |
Investor
Alert |
The
Recession of 2007
The last U.S. recession occurred in 2001, after Fed rate
hikes inverted the Treasury yield curve... |
|
November 22,
2006 |
Investment
Focus |
Does
'Sideline Cash' Predict U.S. Equities?
Today's equity bulls, no doubt
heartened by the recent rally in stock prices, continue to
offer various theories in support of a bullish stance. One
is the so-called “sideline cash” theory... |
|
November 8,
2006 |
Investor
Alert |
How Punitive Fed Policy Can Trump the Benefits of Divided
Government
Many people (usually the advocates of government activism)
decry “gridlock,” but all else equal, over the past fifty
years, divided government in Washington has been a positive
thing for investors. |
|
October 29,
2006 |
InterMarket
Forecaster |
The InterMarket Forecaster |
|
October 16,
2006 |
The
Capitalist Advisor |
Betting Markets Say GOP Will Lose the House
As we’ve seen in past U.S. elections, betting markets –
where people put there own money on the line – tend to be
much more accurate than opinion polls when it comes to
forecasting results |
|
October 11,
2006 |
Investor
Alert |
North Korea's Nukes and the Market’s Rally
The Bush Administration this week lost any remaining
credibility in foreign policy. |
|
September 29,
2006 |
InterMarket
Forecaster |
The InterMarket Forecaster |
|
September 21,
2006 |
Investor
Alert |
The Policy Mix Index:
Yield-Curve Inversion Signals Trouble
IFI’s Policy Mix Index (PMI) – a weighted grading system
assessing monetary policy, fiscal policy, trade policy,
regulatory policy and foreign policy – has declined to -15.0
(Table One, page 2), versus readings of ... |
|
September 11,
2006 |
The
Capitalist Advisor |
Why America
Can't Win Wars Anymore
Over the past five years we’ve observed something even
more horrific than what we witnessed five years ago today,
when Islamic terrorists sponsored by Islamic regimes in the
Middle East murdered 3,000 innocents by using three
commercial airplanes to destroy the World Trade Center and
part of the Pentagon. Why more horrific? |
|
August 31,
2006 |
InterMarket
Forecaster |
The InterMarket Forecaster |
|
August 21,
2006 |
Investor
Alert |
Rationalizing Recession
Few analysts at the time saw recession as likely in the
foreseeable future and none would dare say (publicly) that
the Fed might deliberately trash the economy, since most
believe the Fed always knows (and does) best. |
|
August 14,
2006 |
Investor
Alert |
Two
Cease-Fires -- Neither of Which is Bullish
In the past week investors have had to assess the likely
market impact of two “cease-fires.” |
|
August 7,
2006 |
Investment
Focus |
Predicting U.S. Equities:
Interest Rates Matter More than Earnings
When it comes to forecasting U.S. equity performance, most
analysts, strategists and economists focus on two key
variables: earnings and interest rates... |
|
July 28,
2006 |
The
Capitalist Advisor |
Reflections on a Quarter-Century in Business
I walked forty blocks south, from my tiny apartment on
Manhattan’s upper east side to my first professional job as
a management trainee for Manufacturers Hanover Trust Company
at 350 Park Avenue. |
|
July 14,
2006 |
The
Capitalist Advisor |
Israel
Fights Back, But the U.S. Keeps Appeasing
No investor can afford to ignore geo-political trends,
especially those that destroy portfolios. |
|
July 7, 2006 |
Investment
Focus |
Forecasting Shifts in U.S.
Corporate Profit Margins
As we enter the latest U.S. “earnings season” (with
corporate reports of second-quarter results, through June
30th) and see new estimates of year-ahead profit
performance, investors should be aware that |
|
June 30,
2006 |
InterMarket
Forecaster |
The InterMarket Forecaster |
|
June 21,
2006 |
The
Capitalist Advisor |
Bill
Gates: Triumph and Tragedy
Microsoft’s co-founder and chairman Bill Gates announced
last week that as of July 2008 he’ll no longer work
full-time at the firm; thereafter he’ll devote most of his
time (and wealth) to a philanthropic foundation he
established in 2000. As he’s been doing in recent years,
Gates will shift further away from creating wealth toward
giving it away. |
|
June 13,
2006 |
Investor
Alert |
Technical
Fouls – by Bulls in Denial
Stock bulls are in denial about the Fed’s blatant sabotage. |
|
June 7,
2006 |
Investment
Focus |
Forecasting Commodities
How can investors best forecast and profit from forthcoming
changes in commodity prices? |
|
May 31,
2006 |
The
Capitalist Advisor |
Paulson
and the Dollar
Earlier this month we showed why a potential cessation
of further Fed rate hiking later this year won’t necessarily
be... |
|
May 25,
2006 |
InterMarket
Forecaster |
The InterMarket Forecaster |
|
May 15,
2006 |
Investor
Alert |
The
Beginning of the End
The bull market in U.S. equities was nice while it lasted –
but our market-based signals indicate that it’s coming to an
end – if, indeed, it hasn’t ended already. |
|
April 28,
2006 |
Investment
Focus |
Anticipating Shifts in T-Bill Rates, T-Bond Yields and the
Yield-Curve Spread
This study shows how a set of
forward-looking market prices forecasts (one-year ahead)
T-Bill rates, T-Bond yields and the Treasury yield-curve
spread (defined as the difference between T-Bond yields and
T-Bill rates, as reflected in the shape of the yield curve,
whether it be steep, flat or inverted). |
|
April 25,
2006 |
InterMarket
Forecaster |
The InterMarket Forecaster |
|
April 14,
2006 |
Investment
Focus |
Forecasting Fed Rate Moves
This study illustrates how a
set of important, forward-looking market prices reliably
forecasts (one-year ahead) Federal Reserve policy -- which
basically entails shifts in the overnight Fed Funds rate. |
|
April 7,
2006 |
Investment
Focus |
Predicting U.S. Sector Performance
This report shows how a set of
five important, forward-looking market prices forecast
absolute and relative stock performance by the ten main U.S.
sectors. |
|
March 31,
2006 |
InterMarket
Forecaster |
The InterMarket Forecaster |
|
March 28,
2006 |
Investor
Alert |
The Long
and Short of U.S. Interest-Rate Shifts
Today’s rate hike by the Fed -- it's fifteenth since
June 2004 and one that brings the overnight Fed Funds rate
up to 4.75% -- has now definitively inverted the U.S.
Treasury yield curve. Below we remind investors that a yield
curve inversion presents a... |
|
March 18,
2006 |
Investor
Alert |
The Bank
of Japan's Pending Rate Hikes
The Bank of Japan (BOJ)
announced last week that over the coming months it will
cease its five-year policy (begun in March 2001) of a zero
short-term (overnight) interest rate and “quantitative
easing.” |
|
March 9,
2006 |
The
Capitalist Advisor |
The Year of Living
Dangerously
Investors confused about the
seemingly awkward performance of markets year-to-date should
consider the many ways Washington has injected dangerous
elements into the nation’s political economy. |
|
February 27,
2006 |
InterMarket
Forecaster |
The InterMarket Forecaster |
|
February 24,
2006 |
Investment
Focus |
Global Yield Curves and Economic Growth
The currently-inverted U.S. yield curve signals a ... |
|
February 17,
2006 |
Investment
Focus |
Global Yield Curves and Equity Performance
There's no better leading indicator of yearahead equity
performance and economic growth than the local government
yield curve – especially when measured as the spread between
the 10-year bond yield and 3-month bill rate. |
|
February 10,
2006 |
The
Capitalist Advisor |
The Next Fed Head: Part 2
It doesn't take long for markets to gauge the likely
impact of newly-installed central planners. |
|
January 31,
2006 |
The
Capitalist Advisor |
Greenspan's Record: Better Than Predecessors, Not As Good as
Gold
Since today is Alan Greenspan’s last day as Federal Reserve
chairman, it’s an appropriate time to assess his 18½-year
track record – and what it has meant for investors. Our
review can also serve as a guide to those trying to assess
the likely impact of the next Fed head.1 Contrary to popular
assessments, we find that Greenspan’s track record falls
well short of what it should have been. |
|
January
2006 |
|
Outlook
2006 |
|
January
2006 |
|
Track
Record 2005 |
|
January 6,
2006 |
Investor Alert |
The Fed Wants a Recession
One need only be a fact-oriented realist to know that Fed
officials invariably hike short-term rates until they
inflict widespread pain, whether in the form of stock and
bond price crashes, corporate bankruptcies, house-price
plunges or recessions. But as before, today few people can
make themselves believe it. |
2005 |
|
December 31,
2005 |
InterMarket
Forecaster |
The InterMarket Forecaster |
|
December 23,
2005 |
Investment
Focus |
Dubious Dow Theory
Dow Theory suggests a
bullish stance on U.S. stocks for 2006. But the evidence
supports a precisely opposite stance. |
|
December 16,
2005 |
Investor
Alert |
What Gold Portends
Last week we examined
the likely future direction of the gold price – one of the
most important leading indicators (besides the Treasury
yield curve) in our market- based forecasting system... |
|
December 9,
2005 |
Investment
Focus |
The Meaning of Gold at $500
The purchasing power of gold – what an ounce of it buys in
terms of tangible goods – has been relatively stable for
over three centuries.1 That’s why, throughout human history,
civilized nations converged on gold (and gold-convertible
instruments like currency and checks) as money, for gold has
always served as a stable and reliable yardstick. Gold’s
relative stability also explains why England and America –
the two nations most associated with the Industrial
Revolution – were on the gold standard for most of their
history. |
|
November 22,
2005 |
Investment
Focus |
The Business Cycle, Inflation and U.S. Sector Performance
Two market-price signals provide reliable forecasts of the
U.S. business cycle and inflation climate... |
|
November 15,
2005 |
Investor
Alert |
The
Outlook for U.S. Sector Profits
The 'consensus' outlook of analysts and strategists on Wall
Street is for a rise of 12% in S&P 500 profits over the
coming year. |
|
November 7,
2005 |
The Capitalist Advisor |
The Next Fed Head –
Part 1
Two weeks have passed since President Bush
nominated Ben Bernanke to replace Alan Greenspan as chairman
of the dozen-or-so central planners ruling Washington’s
central bank – i.e., the money monopolist known
affectionately as the Federal Reserve. |
|
October 31,
2005 |
InterMarket
Forecaster |
The "Peak Oil" Thesis:
Supply or Price?
As Yogi Berra once said, “it's
deja vu all over again." As in the late 1970s, when the oil
price nearly tripled in four years (from $11/barrel at the
end of 1975 to $32/barrel at the end of 1979), the
near-tripling of the oil price during the past four years
(from $21/barrel at the end of 2001 to $61/ barrel more
recently) has led to a growing gang of doomsayers claiming
the world is “running out of oil.” In the 1970s it was
called “limits to growth.” Now it’s called “peak oil
theory.” |
|
October 21,
2005 |
InterMarket
Forecaster |
The InterMarket Forecaster |
|
October 14,
2005 |
Investment
Focus |
The Japan That Few
Predicted
Few economists or strategists
predicted the strong economic growth or robust equity gains
witnessed in Japan in recent years; fewer still projected
that Japan might outperform other major economies and stock
markets – as it certainly has. |
|
October 7,
2005 |
The Capitalist Advisor |
The Policy Mix Index:
Government Burdens Mount
IFI's Policy Mix
Index (PMI) – a weighted grading system assessing monetary
policy, fiscal policy, trade policy, regulatory policy and
foreign policy – has declined to 13.0 (Table One, page 2),
versus readings of 30.5 (February 2005) and 47.0 (June
2003). |
|
September 30 |
InterMarket
Forecaster |
The InterMarket Forecaster |
|
September 23 |
Investment
Focus |
Fed Policy and Equity
Valuation: The Joint Impact on Future Returns
With persistent attention
focused on yet more hurricanes in the U.S. gulf coast,
there’s little recognition of the fact that man-made
disasters can inflict far more harm on the economy, wealth
creation and portfolio performance. The best current example
of this is the Federal Reserve’s interest- rate policy,
which continues moving on a bearish path. |
|
September 9 |
The Capitalist Advisor |
Unionization's Shift to Government
Not capitalist
'injustice' but Marxist dogma has been the main fuel for
labor unionism for most of the past century, especially in
Europe but also to some extent in the U.S. |
|
September 2 |
Investor
Alert |
Disasters: Natural and Man-Made
Insurers currently estimate that
Hurricane Katrina – which swept through the U.S. Gulf Coast
this week and submerged 80% New Orleans under water -- will
cost as much as $75 billion. If so, it will be the costliest
natural disaster in U.S. history (using inflation adjusted
numbers). As we’ll see, the ten largest hurricanes in U.S.
history (since 1900) were followed by an average decline of
3.1% in U.S. equity prices one year later (Table Three, page
3); but the bulk of that decline is explained not by the
hurricanes per se but by Fed policy – i.e., a man-made
disaster. |
|
August 26 |
Investment
Focus |
The Impact on Stocks When
the Fed "Chases" Oil-Price Spikes
Taking all episodes
(since 1967) together we find – contrary to conventional
wisdom – that a rising oil price alone has not been bearish
for U.S. equities. |
|
August 19 |
InterMarket
Forecaster |
The InterMarket Forecaster |
|
August 15 |
Investment
Focus |
Interest-Rate Shifts Prior
to Recessions
The U.S. has suffered eight
recessions in the past fifty years, each of which was
signaled by an inverted Treasury yield curve – by the rare
condition of bond yields being below bill yields. |
|
August 4 |
Investor
Alert |
The Return of (and On) the
30-Year T-Bond
As expected, the
U.S. Treasury Department announced yesterday that it would
again issue 30-year bonds, after having suspended new issues
in October 2001... |
|
July 29 |
InterMarket
Forecaster |
The InterMarket Forecaster |
|
July 25 |
Investor
Alert |
The Market Impact of
Currency Manipulations in China and Malaysia
Consider what just
happened (last week) with the currencies issued by the
governments in China and Malaysia |
|
July 15 |
The Capitalist Advisor |
The Mythical "Savings Glut"
-- and the Likely Policy Response
Equity investors can
benefit by understanding why the real bond yield is low,
whether it’s likely to remain low or whether it might rise
again. |
|
July 8 |
Investor
Alert |
Market Messages Amid
Terrorism in London
World-wide market
reaction to yesterday's terrorism in London wasn’t nearly as
negative as many analysts expected it might be. What then
might be gleaned from these market messages? |
|
June 30 |
InterMarket
Forecaster |
The InterMarket Forecaster |
|
June 24 |
The Capitalist Advisor |
Another Nail in the Coffin
for Property Rights
The U.S. Supreme
Court yesterday ruled that it's perfectly legitimate for a
local government to seize private property, pay a
below-market price and hand it over to another private
citizen or company that claims it can do more with the
property -- i.e., better develop it and pay more taxes to
the local government. |
|
June 17 |
Investor
Alert |
Will the Yield Curve Invert? Sir Alan's Attempt at a Parting
Blow
President Bush says
he’d like to break the rules and extend Sir Alan’s
expiration date; isn’t it nice to see Mr. Bush working so
hard to make the world safe for monetary monarchy? |
|
June 10 |
The Capitalist Advisor |
The SEC: Consequential and
Destructive: Can Christopher Cox Make It Less So?
An "excessive
accumulation of complicated laws" surely characterizes the
U.S. in recent years, especially laws violating the freedom
of corporate executives, investment bankers and CPAs. The
regulatory-litigation craze of recent years has sought to
criminalize business mistakes and create scapegoats to
deflect public anger and criticism away from the government
policy-makers who actually caused the bear market of
2000-2002. |
|
May 27 |
InterMarket
Forecaster |
The InterMarket Forecaster |
|
May 23 |
Investment
Focus |
Whither Commodity Prices?
Historically,
commodities have outperformed more-traditional asset classes
(stocks, bonds and bills) -- and usually in consecutive-
year periods -- far more frequently than most people
realize. |
|
May 16 |
Investor
Alert |
Can the Dollar's Rally
Persist?
Since the year
began the U.S. dollar has appreciated between 2% and 5%
against major currencies and by roughly 9% against gold. Can
this rally persist? |
|
May 6 |
Investment
Focus |
Is That It For Corporate
Bonds?
After
underperforming U.S. Treasury bonds materially for roughly
six years (1997-2002, inclusive), corporate bonds in the
U.S. -- whether one considers investment-grade, high yield
or convertible bonds -- have outperformed T-Bonds
significantly since the end of 2002... |
|
April 28 |
Investment
Focus |
The Bearish Inflation
Premium
History makes clear
that inflation is bearish for stocks. Yet many economists
and strategists have difficulty even defining inflation, let
alone measuring or forecasting it. |
|
April 25 |
InterMarket
Forecaster |
The InterMarket Forecaster |
|
April 8 |
Investor
Alert |
CAPEX and Sector Performance Re-Visited
The rate of growth
in capital expenditures (CAPEX) by U.S. businesses will
likely decelerate by half over the coming year -– and as we
explain below, this deceleration will likely influence the
relative performance of S&P 500 sectors. |
|
March 31 |
InterMarket
Forecaster |
The InterMarket Forecaster |
|
March 21 |
Investor
Alert |
Are There Parallels to the
1930s?
In re-visiting the
ten-year periods following these two prior episodes we'll
try to ascertain whether the S&P 500, over the coming five
years, might share their fate -- that is, might suffer a
weak and halting recovery followed by still further
declines. |
|
March 14 |
Investor
Alert |
Is That It For Small-Cap Stocks?
Is this the year the small-cap winning streak comes to an
end? |
|
March 7 |
Investor
Alert |
Stability, 'Excess' and
Conundrums
We will see yet
another yield-curve inversion before Greenspan finally
leaves the Fed next January? |
|
February 25 |
InterMarket
Forecaster |
The InterMarket Forecaster |
|
February 16 |
Investor
Alert |
The 'Mythical Housing
Bubble' Re-Visited
Thirty months ago
we told investors to ignore widespread claims about a U.S.
'housing bubble.' |
|
February 9 |
The Capitalist Advisor |
The Policy Mix Index: The
Fed Slowly Adds Its Poison
IFI's Policy Mix Index (PMI)
-- a weighted grading system assessing monetary policy,
fiscal policy, trade policy, regulatory policy and foreign
policy-- has declined to 30.5 compared to a prior reading of
47.0. |
|
February 2 |
The Capitalist Advisor |
Capitalism's Greatest
Champion
Today marks the centennial of the birth of Ayn Rand --
capitalism's greatest intellectual champion. |
|
January 31 |
Investor
Alert |
Does January Predict the
Markets Full-Year Performance?
The S&P 500 fell
2.53% this month. Therefore, says a popular investment
newsletter, be afraid be very afraid because 2005
necessarily will be a bear market |