Deconstructing Hopium In 3 Simple Charts

Confused as to how to position your equity portfolio? Need to BTFD? Unsure of what is going on now that Bernanke has left you alone in the dark with reality? Have no fear. These simple three charts, that perfectly describe the process top-down for arriving at a view on US equities, will allay all your fears of missing the next great bull market leg. Equity Prices track Earnings Estimates; Earnings track ISM; and Real-Time Surveys indicate ISM going down. @Not_Jim_Cramer provides this clarifying confirmation of what we noted yesterday with regard to oil prices and slowing global growth (or a lack of printing) - equities appear alone in their hope for now.

1) Price Tracks Earnings

2) Earnings Track ISM

and 3) ISM Is Going Down...

Trade Accordingly.

Comments

[realtick]

Great charts - no bubbles, no arrows, just important data.

Why can't they all be like this?

[mayhem_korner]

[deleted]

[JPM Hater001]

I picked the wrong week to quit fig newtons.

[MuppetMaster]

http://www.youtube.com/user/SOSTacoJohnson?feature=mhee

I have found Alpha.  & I give it to you for free.

Come see what I'm doing.  See what I'm seeing.

[Decay is Constant]

Is it my imagination or are the upswings of the chart staying pretty much at the same level while the downswings keep getting lower and lower?  That doesn't seem to bode well.

Disclaimer:  I do not have any financial background whatsoever, but love to watch this stuff.  Kind of like watching a train wreck in slow motion...just horrible, but can't take my eyes off of it.

[becky quick and...]

great charts. even the kenyan could understand them. probably.

[SilverTree]

~Did I do that?~

http://1.bp.blogspot.com/-ukx7LohaOKU/TgYiLGTVmsI/AAAAAAAAIac/9tzkgV6uKBg/s1600/Did+I+Do+That.png

[Dr. Engali]

Not with out a teleprompter telling him what they mean he can't.

[davinci7_gis]

The charts look alot like a heartbeat to me..the heartbeat of someone having a cardiac arrest :)

[ceilidh_trail]

Sooo, bad time to get into TNA?

[bmusic]

TNA puts maybe

[Mugatu]

TZA is the bear fund to TNA.

[Dr. Engali]

I could get into some good T & A......oh I think we are talking about two different things.

[Bastiat]

Moody's shoots down bank-backed Muni Turkeys.

http://www.bondbuyer.com/news/moodys-downgrades-45-billion-munis-related-banks-1041192-1.html?ET=bondbuyer:e5431:2205135a:&st=email&utm_source=editorial&utm_medium=email&utm_campaign=BB_intraday_062212

[mayhem_korner]

caus-o-rellation, muppetz!

[Conman]

Chartology lesson is that hopium always recouples with reality eventually.

[SmoothCoolSmoke]

But today....the BS pump is on.  Why isn't the entire SEC staff.......IN JAIL?

[nobusiness]

I would love to stay short, but looking at last years 6/30 quarter close the SPY went from 127 to 134 in the 4 days ending 7/1/2011.

[The Monkey]

Agreed... And this year we have GS on the bear side to boot. Set-up for quite a squeeze.

[debtor of last ...]

Never knew that buying a house with a mortguage was also "trading". Bitchez.

Give me back my life gubmints, Bernanke's, Sorosses and related agents. I can't do my job for my employer anymore, because it's a multinational. With tentacles like GS. 

I want to watch them burn. Creepy motherfucking assholes. Everytime i see the big boss at night, in my dreams, he says: Your mother sucks cock in hell. And then he turns his head 180 degrees.

Soon everything will turn 180 degrees.

Thanks ZH, for providing truth.

[distopiandreamboy]

Quarterly options expiration next week has a historically upward bias, so no need to look at any data just BTFD.

[Bastiat]

<duplicate>

[Pairadimes]

If these charts were off a seismograph, we'd all be in the street in our underwear, dodging sheets of glass falling off of buildings all around us.

Actually, this is really not that different....

[JohnKozac]

Scary charts...luckily the NYSE is up, up and away today.....100% disconnect.

[carbonmutant]

The Equities market is a Mirage in an economic desert...

[uhb]

well how about stfd?

sell the f*ing dip :)

[slewie the pi-rat]

re-aligning the equity outlook for BiCheZ

^{by slewie}

1. 1) reduce equities to zero
2. 2) reduce equity weighing to zero
3. 2) reduce retirement exposure to zero
4. 11) get more exercise
5. 9) reduce counter-exposure from any equity-issuing sack-0-shit to zero
6. f) rinse
7. 4)  repeat

[fuu]

Where do sunscreen and hookah fit in there?

[slewie the pi-rat]

excel secrets are forbidden secrets...

[fuu]

Wow you can afford the good stuff, I'm stuck with libre.

[q99x2]

Uvxy down 20%. I'm going back to work out front of the 711.

[Galactic Superwave]

A chart of the real time surveys vs. the S&P would be nice to make the point even more obvious.

[LMLP]

From Mckinsey

http://www.mckinseyquarterly.com/newsletters/chartfocus/2012_06.html

The de-leveraging has a shitload left to go