Following up on my “Sell equities” post, I want to highlight a factoid from today’s David Rosenberg’s Breakfast with Dave distribution.
Never before has the S&P 500 rallied 60% from a low in such a short time frame as six months. And never before have we seen the S&P 500 rally 60% over an interval in [...]

One other reason to sell the dollar is interest rates.  Why not borrow in dollars where interest rates are low and invest elsewhere where yields are high?  This is what is known as the carry trade.
In the past decade, the Japanese yen and the Swiss franc were favorites for the carry trade because of their [...]

In late August, I wrote a post called “Getting bearish again” in which I said that the bear market rally I had anticipated back in March was long in the tooth.  At the time, I mentioned 1026 on the S&P 500 as a sell signal.  With the S&P 500 now well over 1060 and gains [...]

This comes via TheStreet.com and Doug Kass, a noted market strategist:
Many strategists (both bullish and bearish) assume that a fair value P/E multiple — based on interest rates and inflation — rests at about 15.5 times. Averaging the 2009 and 2010 S&P consensus forecasts produces a melded $67.50 S&P EPS, a year-end target of 1045 [...]

Yesterday I mentioned the announcement by the FDIC to end its debt guarantee program and opined that this was the first sign of tightening/liquidity withdrawal by the U.S. government.  Today the evidence is mounting that this is indeed an orchestrated move toward policy normalization.
The FT spoke to treasury officials who confirmed this interpretation:
A senior Treasury [...]

The U.S. Dollar fell to its lowest against the Swiss Franc and Euro, while the Canadian dollar and the Scandinavian currencies are also near year highs as well.  If you read Bloomberg, you might think this has to do with a bullish equity market call as the dollar’s status as a safe haven is less [...]

In the latest move toward China’s long-term strategy of internationalising its currency, the Chinese Ministry of Finance announced today it will issue government bonds valued at 6 billion yuan in Hong Kong.
The last article I wrote on this subject was a little over a week ago when the Chinese Vice-Premier Wang opined that the [...]

So we started September in an ugly way. With the markets down 2% across the board, and oil and bond yields also falling.  Forgive me for thinking this is a bad sign, but selling on good news doesn’t sound very bullish.
  And the ISM data definitely was bullish. Production 61.9 – Yay! New orders [...]

You have heard me use the phrase “liquidity is seeking return” to describe the increase in the price of riskier assets due to monetary stimulus. The Bloomberg News video clip below points to an increase in lending for buyers of riskier loans like high yield and mortgage bonds.

The blurb below from the associated article at [...]

This skit comes from Saturday Night Live in 2005, back when the Dollar was weak.   It’s pretty funny. Hat Tip Andrew.

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