Posts by admin

The gap between 2-year and 10-year Treasury yields is now the most inverted since 1981:

Despite the market having had a nice rebound this summer, the bear market rally fizzled as it broke above its 50-day exponential moving average. Long-term, we are still above the 200-day exponential moving average (EMA), but that too is within earshot. The SPY closed at 392.27 while the 200-day EMA is at 367.20. A drop…

This is a chart of the S&P 500 SPDR. Spider (SPDR) is a short form name for a Standard & Poor’s depository receipt, an exchange-traded fund (ETF) managed by State Street Global Advisors that tracks the Standard & Poor’s 500 index (S&P 500). The S&P 500 “is a stock market index tracking the stock performance…

All of the major market indices have rallied nicely off of the lows set in June. The question is whether this is the start of a new bull market or merely a bear market rally. Fundamentally, stock prices are all about earnings. As corporate earnings rise, stock prices usually follow. While corporate earnings and stock…

The United States of America is bankrupt beyond our ability to grasp the enormity of the debt. To put it in perspective, as I mentioned in “A Freight Train is Coming Your Way” post, our current national debt is over 100 trillion dollars. If you use the 100 trillion dollar number, which is probably on…

I calculated the historic average S&P 500 P/E ratio going back to 1871 using the data available on this website. The historic average P/E ratio is 15.98. The math is as follows: Current P/E Ratio = 20.58Historic Average (Going back to 1871) = 15.98Difference = 7.13Difference Divided By Average (7.13/15.98) = 44.62% So, by simple…

Most markets act like a pendulum. Prices go from undervalued to overvalued and back again to undervalued. They never stop at fairly valued. They can, however, remain undervalued or overvalued for years. We are now at what appears to be the tail end of biggest housing price boom ever. According to an article in Fortune…

A big question amongst investors is whether it’s a good idea to pay your taxes in advance as you do with a Roth IRA or defer them as you do with a traditional IRA. Traditionally, the advice has been to defer taxes as you are expected to be in a lower tax bracket after retirement…

After what has been described as the worst first half of the year for stocks in a very long time, it’s time to assess the damage. There is an old saying that it’s not a stock market as much as it is a market of stocks. Of course, while this makes intuitive sense it can…

If you read my last post you know that the stock market is still seriously overvalued. Well, it’s worse than that. The country’s gross domestic product (GDP) is the result of 4 components. Personal consumption expenditures, business investment, government spending and net export of goods and services. In 2019 70% of the US’s GDP was…