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October 28, 2016
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Vox – Brexit’s victory doesn’t mean the polls are wrong about Trump For starters, the polls got Brexit right! Donald Trump has a simple answer for people who look at his flagging poll numbers and pronounce him toast: Brexit. Trump told rallygoers that the results on Election Day will “be like Brexit times five.” Newt Gingrich… Continue reading An Updated Look At The Election And The Brexit Parallel
The Economist – Are magazine covers a contrarian indicator? FINDING a reliable way of timing the market is something that has eluded the greatest investment minds in history. That is why many people are tempted by the “magazine cover indicator” as a contrarian signal. One of the most famous was Business Week’s “Death of Equities”… Continue reading Using Economist Covers As Contrarian Indicators
Nikkei Asian Review – China tightens capital controls amid yuan’s continuing slide China has toughened restrictions on capital flows to prevent a negative feedback loop between a weakening yuan and capital flight. The State Administration of Foreign Exchange has introduced new capital measures in areas such as Shanghai and Guangzhou since the beginning of autumn,… Continue reading China Attempts To Stop Capital Outflows
Barrons – When the Fed Hikes, Will It Raise the Rate It Pays Banks Too? Bryce Doty, portfolio manager of the Sit Rising Rate ETF (RISE), isn’t just thinking about when the Federal Reserve will raise rates, but how. He points out that the Fed may not have to raise the interest rate it pays… Continue reading The Mechanics Of A Fed Hike
<Click on graphic for larger image> Bloomberg.com – Uneasy Calm Grips Markets Suddenly Silent Before U.S. Vote It’s happening again. Markets around the world, from stocks to metals and bonds, have slowed to a crawl, revisiting lows in volatility that have stood for two years. Muted moves just sent a cross-asset gauge of price swings in… Continue reading Where’s The Volatility?
Bloomberg.com – Mohamed El-Erian: Why This Dollar Surge Is Different for the Fed The dollar has returned to highs it last reached nine months ago. The drivers of this increase are similar to those that caused the currency to surge earlier this year. Yet, this time, the impact on financial markets has been quite different.… Continue reading El-Erian On The Surging Dollar
Reuters – ECB all but certain to keep buying bonds beyond March, ease QE rules – central bank sources The European Central Bank is nearly certain to continue buying bonds beyond its March target and to relax its constraints on the purchases to ensure it finds enough paper to buy, central bank sources have told… Continue reading The ECB Looks To Relax Constraints On Bond Buying
<Click on chart for larger image> Reuters – Largest exodus in five years hits U.S.-based stock mutual funds: ICI Mutual fund investors flooded stockpickers with redemption orders during the latest week, cashing out the most money in five years, Investment Company Institute data showed on Wednesday. The investors pulled $16.9 billion from stock mutual funds… Continue reading Largest Weekly Outflows From Equity Mutual Funds In Five Years
<Click on chart for larger image> Barrons – Are We In A Passive Investing Bubble? The Wall Street Journal recently published the article “The Dying Business of Stock Picking,” but for Strategas’s Jason DeSena Trennert and Ryan Grabinski it was déjà vu all over again, harkening back to BusinessWeek famous 1979 cover story “The Death… Continue reading More On Active vs. Passive Investing
Financial Post – David Rosenberg: All signs are flashing this market is ‘late in the game’ Late in the game: that is precisely where we are. And it’s not even an opinion any more. It is a market fact. The TSX has not made a new high in over two years and it has been… Continue reading David Rosenberg Sees Late-Cycle Pricing
Bloomberg.com – The $18 Trillion Credit Pension Injection Traditional investing logic would indicate that the rally in bonds is overdue for a reversal, but investors may have to continue to wait for any such turn. They can thank or blame pension funds, depending on their perspective. These funds now oversee more than $18.6 trillion, a volume of… Continue reading Pensions’ Appetite For Debt