Dow Jones Industrial Average
If anyone had wondered if Stanley Druckenmiller's recent bearishness had dissipated, or transformed into at least modest bullishness as a result of the market meltup, we have bad news.
There’s something about being insanely rich that people will believe every word that comes out of your mouth no matter how bizarre. As one of the richest men in the world, Warren Buffett’s opinions carry almost Biblical impact, even when they might be completely ridiculous.
Despite his proclamation that he "saved the world from a Great Depression," the fact is that Obama will be the first President ever to not see a single year of 3% GDP growth - but only cynical fiction-peddlers would mention facts at a time like this. In yet more legacy-defending narrative, Obama told The NYTimes today that his biggest failure was being unable to sell his success in putting the American economy back on track to the American people (no matter the actual realities) careful to blame Republicans for slowing growth "by a percentage point or two." And then in a final affront to fact, Obama dismisses the conclusion of "The Big Short" proclaiming that he reined in Wall Street, overhauled the banking system, and made water from wine "the financial system substantially more stable."
Shortly after the close today, Apple will report its much watched earnings which will be closely watched for several reasons. The biggest one is that since Q1 2014 AAPL has contributed 25% of the S&P’s 4.2% growth rate (excluding the EPS benefit of the company's massive buyback program). Furthermore, roughly 40% of the nearly 9% jump in Tech margins since 2009 is attributable to Apple alone. However, that was all in the past: this quarter Apple is actually forecast to subtract 0.7% from the S&P's bottom line.
With the Dow Jones industrial average near its record high, slightly more than half of Americans (52%) say they currently have money in the stock market, matching the lowest ownership rate in Gallup's 19-year trend. And the worst news for Yellen: "although Americans in all income groups are less likely to have stock investments now than before the Great Recession, middle-class Americans have been the most likely to flee the market"
The rally since February has done very little “wrong” in terms of its quality of advance. Sure, many folks would have liked to have seen more volume accompanying the move. We have pointed out some preliminary evidence of complacent or overly bullish sentiment, at least on a short-term basis. Now, we are beginning to see the until-now stellar rally breadth begin to show cracks. However, for the first time since mid-February, the breadth situation is not looking quite as sweet as it was.
About That Historic Q1 Market Rebound: 24 Of 26 Massive Snapback Rallies Occurred Within A Secular Bear MarketSubmitted by Tyler Durden on 04/03/2016 18:58 -0400
One thing that may be instructive about the massive Q1 reversal which saw the Dow Jones rebound off its low by the most since 1933, is the overall investment climate in which they occur. The three prior events took place within secular bear markets. Additionally, there were 26 other quarters since 1900 which saw the DJIA recover at least 8% off its quarterly low after being down at least 10%. All but 2 of those quarters (4Q, 1987 and 4Q, 1997) occurred within a secular bear market.
The 2nd quarter of election years has the worst average historical return of the 4-year Presidential Cycle.
A yuuge surge in stocks - amid collapsing earnings and GDP expectations - appears to have enabled a modest bounce off 2-year lows for consumer confidence. The Conference Board’s index of consumer confidence increased to 96.2 in March from 94 a month earlier - but still below January's levels. The bounce was driven purely by "hope" as expectations for the future rose and current conditions dropped to 4-month lows. At the same time Gallup's consumer confidence survey plumbes new depths to its lowest since 2015.
See how it works? Central banks destroy the real economy with cheap money and extractive policies. Then, as the economy slumps, they need to bring their policies in line with the slumping economy. They need to swear off raising rates back to normal. And since their policies can never produce real prosperity, they can never produce an economy that can support normal interest rates. Normal? Forget it. Eventually, normal will make a comeback. But not because the Fed wants it. Instead, the markets will normalize – brutally – over the Fed’s dead body... which is just the way we’d like it.
"Now, the zeitgeist has changed. Ms. Merkel is out of style and out of step. In Britain, France, the Netherlands, Slovakia, Hungary, and the U.S., the candidates getting the most enthusiastic support are those who urge closing borders, restricting trade, and looking to protect themselves from all that is threatening, different, or new. Forget free trade! Forget freedom of travel! Stop immigration… especially of the Muslims and Mexicans! Build a wall! Torture your enemies! Stop trying to expand the empire!"
Stock markets are said to “discount the future.” Maybe they see something we don’t. Or maybe they are simply preparing for a more spectacular day of reckoning by drawing more mom-and-pop investors into deeper water; as always, we wait to find out.
"For FY 2015, the 20 companies in the DJIA that reported non-GAAP EPS reported an average year-over-year decline in non-GAAP EPS of -4.8%. These same 20 companies reported an average year-over-year decline in GAAP EPS of -12.3%." - FactSet
The gold bull market has returned and gold could surge over 1,000% to $8,000 per ounce in the coming years on ZIRP and NIRP according to legendary gold investor and industry insider Pierre Lassonde.
Comparatively, the S&P 500 index is down 4.7% this year, the Dow Jones Industrial Average is down 4.5% and the NASDAQ is down 7.8%. International indices have also seen losses with the FTSE down 2.6%, the DAX down 10.7% and the Nikkei down 13.7% (see table below).