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"It's Not The US Economy, It's Just Stocks Stupid!!"
Well... Maybe it was the US economy all along?
Just ask Jack Bouroudjian from 2,000 Points ago: August 19th - Chair Yellen, please take your victory lap...
Remember, bull markets don't end because the central bank starts to raise rates — they end when the central bank stops raising rates.
Or maybe when the world realizes the entire rally is smoke an mirrors...
Charts: Bloomberg
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instead of poor people with suicide bombs killing middle class guys, middle-class people with suicide bombs started killing rich guys http://www.philiacband.com/propaganda.html
Way back before most y'all were born, the equity market was a reasonable predictor (discounter) of future earnings and hence, economic activity. Sure, it was a shit show even then, but in a very different way. Things were still reasonably rational.
The Fed et al, looked at the equity markets (reasonably as being a good indicator of future economic activity
Then they decided that if they goosed equities, then the economy MiGhT FoLLoW as in Perceptions Management, BUT THE WORLD NO WORKIE THAT WAY
They got the tickie and laundry confused
So here we are now, with the Geniuses at the Central Banks trying to goose the economy by goosing equities, and it don't work.
After all, most People like the yous and mes of the world who Once Owned Equities, lost their asses and got nothing left OR, just said No Fucking Thanks after 2008/9
So, what's to goose?
Not the general level of economic activity. (Inversion of cause and effect)
Just the people who get the Fed money for free and arbitrage in Financialspeculationville with it.
Good Night and Good Luck
Hope they get eaten alive in their sleep, like the harmless, innocents they ignore being murdered daily by Planned Parenthood.
Where the fuck has Morality gone?
full upvote neutralized by last two sentences for me. fantastic before that though
Heaven help you
Just because you can buy fresh baby heads and baby livers online doesn't mean that you should.
Hey, baby killers gotta get respect right?
Even if you are 'pro-choice' how can one be 'pro-abortion'?
It is a sign that a lot of mistakes were made...and the least favorable outcome was obtained.
If you can't get these factors under control by 12 weeks...maybe you shouldn't have...
Just make the check out to Murder Incorporated
Full downvote given by realizing statists want control of ALL aspects of your life.
I went from Stock Market in 2005 to the Stack Market. And feel much better that I did, thank you very much.
You get an AMEN from me on this post. Well done Knucks!
Please don't take this personally. It's my retort to the headline but answers your last question by coincidence; "IT'S THE MONEY, STUPID!"
END THE FED!
"Way back before most y'all were born, the equity market was a reasonable predictor (discounter) of future earnings and hence, economic activity."
I remember those days too. Those were they days where the Stock Market Retail investor was there because they wanted to be there, not forced to play due to cancellation of their defined benefit pension plans and told to place their own earnings on black, red or a number and spin the Rigged Casino Roulette Wheel of the Dow/NASDAQ/S&P500. Since the advent of the 401K, the markets have been forced into an unnatural growth spurt due to unwilling participants. Before that, we just had savings accounts, and stocks were purchased and traded by our rich uncles who smoked big stinky cigars and drank nasty things like Scotch instead of MGD and Schlitz.
Ahhhh yeah, the good old times, where we borrowed on margin, drew down on our lines credit and our home equity loans and partied like there was no tomorrow. Our kids are thanking us for our foresight. Welcome to tomorrow.
You must be one of my "rich uncles".
I never did any of that. I have lived well within my means, and for the last 12 years have been totally debt free. Sure, I don't have a palace. I actually have a doublewide though - situated comfortably on 45 acres with water reserves, cattle and raised bed gardens. I also hold full mineral rights, so when the need to retap the Barnette Shale arises, I will be waiting with a highly customized Producers 88 form for them to sign. We always pay cash for our vehicles and really, truly, carry no debt. We built our own garage (3 cars, two story) with the help of a single contractor, and pretty much did did the same for our two barns. What amuses my friends the most is that our barns and garage are larger than our home. The house is for sleeping, eating and perusing ZH. The outbuildings all serve a purpose. I hate leaving our vehicles and tractors out in the weather - they cost too much for that.
We have passed on our frugality to our son. He is thanking us for our foresight.
<Chuckles.>
Yeah, sorry. We sound like we have similar histories. I didn't mean to offend. I was speaking to the general population in my mind but having re-read the post, I can see why you responded in defence of yourself. Sorry, again.
Al
"I didn't mean to offend"
I'm sure you didn't - but there are several (probably millennial) posters that show their unmitigated hatred towards us boomers because they think we are all spendthrifts who didn't save a dime for our retirements and expect them to pay for our care in late life. In fact, neither my wife nor I currently own, or have ever owned a smart phone, subscribed to cable, or have incurred student debt (or any of the other trivial things millennials piss their money away on). We do have DSL and a home line though for the wife's business, so we are not entirely in the stone age.....
old billionaires never die they just smell that way
...and to tag along with that.
When you're rich, you're just "eccentric". When you're poor, you're fucking nuts.
See how their world works? ;-)
Think this is warrens year?
Who else but somebody who made their money saving Wall Street's ass?
BHP Profit down 50% just out.
China is tits up.
however the stawk was upgraded to "perform" -- Deez Nuts--
How many seconds will this last. Both Tim Cook and BHP CEO are lying.
I saw that as well and extrapolated the same from it. That BHP has an intravenous connection to China, it tells me that 50% reduction at one end of the pipeline equates to the same at the other. China is NOT priced into the market. There's a long way to fall.
Add to that. .
Origin energy, Woodside petroleum, Santos (South Australian and Northern territory Oil service - Fuck yeah I'm Old toknow that) for the Commodity --- OIL/Gas
Bluescope steel - Bhp - for the Commodity - Steel Products
Rio Tinto - BHP .. - For the Commodity - Coal both coking and thermal
Fortesque Metals, BHP, Rio Tinto, Gina "poor little fat Girl" Roy Hill and any other Hopeful - commodity Iron ore and base metals
CSR - and any sugar related institution - commodity - sugar
Housing in general - Yes it is a fucking commodity and then add....
The 4 Pillars of the Banking sector that lives off the margins taken from the above
then add any and all of the other Commodity extractors Ive missed and you can adequately overlay the Australian ASX 200 and come up with an accurate forecast of the Markets down under. (Note the following is a trailing index and its still falling)
http://www.rba.gov.au/statistics/images/commodity-prices.gif
ASX200 maximum would be 28XX - 30XX with no bottom in sight from the commodity world.
Assume the Position when sanity comes home in the final quarters of this year.
P.s. They, in the know, wink wink nudge Nudge, say no more, are OUT
Looks like ASX rose for 3 years straight, before 1000 drop.
Which puts ASX back to where it was 4 years ago.
Caterpillar might have been a harbinger of this Decline. Maybe US Auto Inventory as well.
great chart - i used it to show my wife 'this is why i havent wanted to buy stocks', while pointing out that (i suspect) the 'US Macro' line represents just the 'official' and phony bloated stats.. whereas the real economic stats have been much worse going back much further.
I would like to see that correlation drawn all the way back to QE1.....
ECRI $MACRO
It correlates best with the biggest moves.
The whole concept of a stock valued at 20 times it's earnings always dumfounded me. It is all fluff and created wealth out of thin air. It will also eventually reap havoc on those who rely on that wealth for their survival.
I had this same thought last week. Why would a piece of paper ever be worth the magic 18 times what they earn. Maybe if dividends paid a certain amount you could go by that but without that it's just bogus accounting.
because the paper is for sale and someone will pay you more for it than you paid---its that simple--
for hong kong it was 61 times earnings the other day. not sure about today
"The whole concept of a stock valued at 20 times it's earnings always dumfounded me."
In that case, the P/E Ratio of real "winners" like Netflix, Shake Shack, Facebook, Lulumon and others might make your head explode.
Dear Bagholders,
It has come to my attention that as a result of recent events, some of you are concerned that the Bernanke / Yellen Put is no longer in place.
Rest assured, the Put is alive and well, however we considered it prudent to lower the exercise price to 50% of market value.
Cheers, Janet
Wait ! I thought that little pieces of paper that no longer really exist (only virtually) were worth more and more and more!
And we could all get richer and richer and richer!
You can't stop playing! Just convince 10 friends to send me money!
Arghh!
Can't wait to see what Madoffs, ENRONs, TYCOs, and Worldcoms emerge from this shit storm.
Looks like 1450 for pension fund protection. Don't want to piss the police off too much before a 20% bail-in.
Shit, the entire "market" has been smoke and mirrors for quite some time. Problem is, there is no where to run to now...
yeah: https://www.youtube.com/watch?v=ABbc-O_3_Ac
I think this was in the movie Air America.
Then again, maybe it's something even bigger. Such as all the rich were told that bombs are going to drop soon.
I wonder if those useful idiots on CNBS actually believe what they are saying about "the recovery" and the "bull market" being supported by "strong fundamentals", or if they are merely superb actors following a script.
If the former, I'd love to see the moment when that fucking chunky fuck Liesman's eyes go dull as he realizes at long last, that everything he has believed in for six years, every government statistic he as accepted without question, and everything he has told viewers to believe, was and is nothing more than The Big Lie, and that his life has been a total waste, and that those who believed him have been ruined completely.
But, in order to see that moment, I would actually have to watch CNBS. Would somebody here with a more morbid interest in CNBS than I please put that moment up on YouTube for me shortly after it happens?
Maybe he will find comfort in the fact that by 2015 nobody was watching except for the comic relief.
Massive structural problems in the market with trillions of dollars of wealth lost and Liesman will be stressing the importance of the next meaningless non-farm payrolls report.
LMAO!
"I am certain that the account in question is not mine," Hunter said in a statement to multiple news outlets. "This account was clearly set up by someone else without my knowledge and I first learned about the account in question from the media."
Yes, clearly ;-)
http://www.usmagazine.com/celebrity-news/news/joe-bidens-son-hunter-bide...
really?!? reading that trash - Why? Don't you get the goose bumps even looking at that shit?
One man's trash is another man's treasure ;-)
i would trust Hunter Biden's truthfulness more than... uhh... his lying scumbag father? but I guess that's not saying much
Stocks are now trading at 14.5x twelve month forward earnings. Stocks are cheap. Can they get cheaper of course. Since 1988, stocks have traded at 17.6x ttm operating earnings. Target level on the S&P at the end of Sept 2016 is approximately 2200 (127*17.6). Buy now and you should get about a 20% return. Start the insults if you like, but the numbers are the numbers. There is no better alternative. I guess you can buy gold and admire your shiny piece of metal that produces no cash if you choose. But remember you will need someone who likes the shiny stuff more than you do to make any money.
Real numbers beg to differ with reported earnings.
Sure based on non GAAP fantasy, stocks may be trading at 14.5x but not based on real numbers.
Perhaps you missed the corporations in the S&P overstating earnings above profit by half a trillion dollars or so. Amazing that you can earn more than your company takes in profit.
Kind of like saying you made $150k last year on your $40k salary. To a normal person that sounds impossible.
What operating earnings portrays are mainly earnings adding back non cash expenses and non recurring expenses. You may disagree with the presentation and can value stocks any way you choose. I think it is appropriate to add back legitimate non cash and non recurring expenses to get the true picture of a company's financial situation.
Tony: first off, I gave you 1 of the down arrows. Second: the "shiny stuff" isn't for "sale", it's for protection. Think of the "shiny" stuff as insurance, sort of like the insurances that I am certain you hold on your car/house/life etc. Nothing more, nothing less. You don't buy insurance to make money, do you? It's INSURANCE, period, correct? Lastly, you lost me at your statement "now trading at 14.5x twelve month forward earnings". Excuse me, that's a guesstimate. None of those fucking analysts have a fucking clue what's going to happen in the next 12 months, do you? If you do, why in the fuck would you want share it with the rest of us? Those "analysts" are trying to sell stuff. Do you believe every commercial on TV? You must be a shill. Do you know what a "shill" is? I hope I didn't "insult" you, but this is a fight club, and you knocked yourself out by a TKO. Do you know what a TKO is?
All investing is a guess. Some guesses are easier than others. Stable businesses like wireless are much more predictable than commodity businesses. So to your point, the $127 earnings prediction could quite well be wrong, Higher or lower.
As for gold. Gold is very much like religion. Either you believe or you do not. But the facts are the facts. Gold is worth what the next person is willing to pay for it. It has no intrinsic value. In fact unlike silver, it has very little commercial use whatsoever so its value is based on faith that it is worth something valuable.
Lastly your retort was much better than the usual fare you find on ZH with the exception of the last bit of nonsense about the fight club.
Tony, Tony, Tony. If you are correct about gold being much like a "religion", why in the hell is every CB (except the FED) in the world buying up all the gold they can get their hands on? Did they get religion all at the same time? Gold, more-or-less has been used as a source of preserving wealth before all the current religions were founded. Read " The Lost Science Of Money" by Stephen Zarlenga, and that will give you some insight between gold and the concept of money. Gold, as a storage of wealth, has weathered a history of collapsed "money" for over 3000+ years. Hard to beat that track record, buddy. Hell, even Greenspan accepts gold as a storehouse of wealth.
No intrinsic value? The electronics industry uses lots of it. All the PCBs I get manufactured are gold plated.
It all came clear to me when Tim Crook told Cramer that everything was fine with Apple in China.... after the Apple stock has been battered for few days. and then the other BHP president said more or less the same... This fish is starting to really stink.
He said they had a great 2 weeks. There was also much not said. The whole Cramer thing was fish bait if you ask me.
the last part said he also had a great two weeks playing with little Chinese boys in his hot tub, omitted of course
Do you think Tim Cook actually wrote that e-mail?
I don't. I think it was made up.A story the FED put out as cover for the PPT rescue.
If anyone asked, they could point to the better than expected news about Apple in China as to why stocks skyrocketed.
Doesn't explain why Netflix jumped 20%.
Hate to Tell You.
I am now seeing TV Infomercials at 7 PM on Antennae TV.
This is a sign of the Decline of the USSA.
- You can say I should pay for access to Economic & Financial Market Information... I say that is Fascist
- You can say I am not informed, that TV News is not enough, that I Require Friends/Associates/Community Leaders/Mentors and School Teacher... in order to keep up on National & International issues and questions...
- But it the Local, State, and National News doesn't cover the issues... we have to conclude that they are corrupted or operate in corrupted systems
-
Bull Shit. I don't have to pay for News, Financial News, Government News, or some service... in order to be informed about my Democratic Country... even if it is really a Limited Republic... Bull Shit, I don't have to pay for Media.
Hahahahahaha - ya think???
The dumbing down of America is clearly working way past anyone's imagination....
The joke is the supposed rise in US macro data.
I saw a Michael Kors backpack in a store today. On sale for $129 marked down from $225.
I design backpacks along with other things for a living. This piece of garbage was at most a $25 retail item manufactured for $8. $200 worth of bullshit slapped on a product.
That is how you explain everything today. Massive overvaluation based on nothing.
An easy analogy is if you take a Mitsubishi Mirage, a $14k car, and slap an Aston Martin badge on it and ask $140k without changing anything else on the car.
Would there be an idiot out there who pays $140k because it says it is an Aston?
If you pay $350 for a Coach bag, you are doing the exact same thing. If you pay $285k for a 1970 pre-fab house that was dropped on a foundation for $10k, same thing.
This is the hell the Fed has placed us in.
suddenly, there's alot less assholes willing to overpay for "status"
That's "snort and mirrors" but yeah, sure there's smoke too.
US dumbfuks deserve every bit of what's coming... and it's coming soon
Speaking of dumfuks, do you know the difference between viscous and vicious?
"the difference between viscous and vicious?"
Well, at times some of us can be really thick.
It's neither. It's the price of stocks relative to the strength of the economy. A meh economy merits a meh stock market.
Only a financial advisor that is not retiring soon would tell you to stay in because it only took 5 years to recover the loss of the last recession.
Here are some more signs of a recession.
http://michaelekelley.com/2015/05/29/mergers-and-acquisitions-set-record...
http://michaelekelley.com/2015/02/20/fed-warns-of-two-bubbles/
http://michaelekelley.com/2015/02/24/would-you-pay-39-more-than-asked/
http://www.zerohedge.com/news/2015-07-27/when-will-we-ever-learn/
Here is how to respond.
http://michaelekelley.com/2014/10/16/8-things-to-do-when-recession-happens/
Here is how to get your mind off this stuff.
http://michaelekelley.com/category/humor/
Good luck!