While we tend to focus more on the short and intermediate term, we notice that there is a lot going on in the long term time frame. Most obvious is the breakout above the top of a long-term trading range.
The April jobs report on May 3rd sparked a renewal of something I’m calling the "Taper Trade." As I mentioned last week, the effect of renewed faith in U.S. cyclical stocks post-Q2 earnings, along with a rise in the ECRI’s leading economic indicator, better housing data, and this jobs data has been a shift in investor sentiment back towards growth, and away from defensive tactical weightings in Treasuries, the dollar, healthcare, and utilities.
The Fed justified a previous round of quantitative easing "to promote a stronger pace of economic recovery and to help ensure that inflation, over time, is at levels consistent with its mandate".
Leading indicators for the labor market suggest we get an acceleration in payroll gains heading into the fall, which is what the market may be discounting currently as it continues to hit new all-time highs. With the market’s long-term momentum continuing to improve and the outlook for employment encouraging, the risks of a recession and/or bear market appear remote with the market likely heading to new all-time highs into the fall.
We humans are caught between the hunger for glory and the price you pay and the crimes you commit in pursuing it.
While we've yet to set new highs, the trend has collectively been upward, although we have that strange anomaly caused by the late 2012 tax-planning strategy that impacted the Personal Income.
The Wise Sages of Ancient days used to say, “The fate of a Liar, is that nobody believes him, - even when he’s speaking the truth!” Such is the predicament of Japan’s propaganda artists, including the Prime Minister, the Finance minister, and central bank chief, who are all trying to cover-up their boldest scheme yet, to crush the value of the Japanese yen, against the currencies of its major trading partners.
It is graduation time, and this morning finds me swimming in a sea of fresh young faces as a young friend graduates, along with a thousand classmates. But to what?
The Advance Retail Sales Report released this morning shows that sales in April came in at 0.1% month-over-month, a strong improvement over the downwardly revised -0.5% in March.
Global central banks around the world continue to push monetary easing like never before. The Fed and Bank of Japan currently combine for almost $180bn of monthly quantitative easing, an historic experiment in monetary inflation.
FS Newshour Q-Line
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