With the US Fed’s third quantitative easing program since 2009 announced in latter 2012, QE3, we know the Fed is explicitly targeting two key hoped for outcomes. First, Mr. Bernanke has told us he wants to see higher stock prices. So far, so good.
Jeffrey Saut: How to Play this Market
Also, Is Mexico the Next China for U.S. Imports?
Jeffrey Saut, Chief Investment Strategist at Raymond James, spoke with Financial Sense Newshour today to offer some perspective on the markets with a few key insights from their latest institutional investor conference.
While the dollar has come under severe pressure for many years, there have been several times when our dollar has gone on extended moves higher. Those moves higher typically coincide with slower growth outside of the U.S. and more often with some kind of crisis abroad.
Despite the ongoing recession call by the ECRI, the U.S. economy has continued to march forward from the depths of 2009 and, to the surprise of many, even accelerated this year. The question is, where do we go from here? Currently, in surveying both the coincident and leading economic data below, there still doesn't appear to be a recession on the immediate horizon. Furthermore, we may actually see GDP accelerate in 2013, which would be favorable for the U.S. stock market.
I’ve been doing some recent work on housing to check back in with the health of the recovery. There are a number of different statistics we can look at to gauge housing’s health.
Doug Noland, a credit bubble historian and analyst, spoke with Financial Sense Newshour about the global credit bubble now forming, which he calls the "Granddaddy of all bubbles."
Breadth indicators were extraordinarily strong last week. The NYSE daily and weekly advance-decline lines hit all-time highs. The NYSE Unweighted Average, which eliminates the impact of large cap stocks, also hit an all-time high last week. Bears would argue that this leaves us no place to go but down. But, there are very few divergences in the market currently that indicate a selloff is imminent.
Various employment data shows continued improvement in the U.S., helping to support higher stock prices with the perception of economic recovery. As long as the employment situation continues to improve and recession risk remains low, US stock prices are likely heading higher.
There wasn’t a lot of driving news this week. Price has been the biggest catalyst of this move. Higher highs beget more highs, which has attracted more bullish sentiment and more believers.
The Petro Business Cycle, Part II
The Economy and Markets React
Some have called it the “New Normal”, others have difficulty explaining it. Economists are bewildered, as the old economic prescriptions don’t seem to work. Policy makers are equally perplexed.
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