Financial Review

Thirst for Innovation

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-03-24-2015.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair Noe DOW – 104 = 18,011 SPX – 12 = 2091 NAS – 16 = 4994 10 YR YLD – .03 = 1.88% OIL + .06 = 47.51 GOLD + 3.90 = 1194.20 SILV – .04 = 17.04   The Labor Department reports the consumer price index climbed by a seasonally adjusted 0.2% last month. Gasoline prices rebounded in February. Higher costs for food, housing and new cars also contributed to the increase. Still, there’s been zero overall inflation in the last 12 months, mainly because of the big drop in gas prices. If food and energy are excluded, so-called core consumer inflation has risen at a 1.7% rate over the past 12 months.   In February energy prices rose 1%. Gasoline price are still down almost 33% in the past year. Food prices moved up 0.2% last month, bringing the increase over the past 12 months to 3%. Shelter costs also rose 3% in the past year. The cost of medical care fell in February for the first time since 1975, although overall health-care costs were unchanged.   Now, the reason the CPI number is important is because the Federal Reserve last week shifted from being patient about raising interest rates to being data dependent about hiking rates, and the data they are focusing on is inflation and jobs. Although the Fed uses a different index as its preferred …

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Financial Review

Transitory, Not Terminal

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-03-23-2015.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair Noe DOW – 11 = 18,116 SPX – 3 = 2104 NAS – 15 = 5010 10 YR YLD – .01 = 1.91% OIL + .88 = 47.45 GOLD + 6.90 = 1190.30 SILV + .25 = 17.08   The Dow Jones Industrial Average is still above 18,000. The Nasdaq Composite is above 5,000. The Russell 2000 is near record highs. Japan’s Nikkei 225 Composite, which dipped below 17,000 early in the year, took about a month to surge from 18,000 to 19,000 and is now rapidly approaching the 20,000 level; heights that haven’t been seen since 2000. Germany’s DAX recently traded above 12,000 for the first time and is up nearly 30 percent from the lows set earlier this year. London’s FTSE 100 is over 7,000, at its highest level in 15 years. Central bank monetary easing seems to be having the desired effect of pumping up financial assets around the globe, and even if the Fed is talking about hiking rates in the US, we haven’t seen a serious rate hike tantrum on Wall Street, yet.   U.S. home resales rebounded less than expected in February. The National Association of Realtors said that existing home sales rose 1.2% to an annual rate of 4.88 million units. Inventories are tight and also sales were hurt by harsh winter weather in the Northeast, where sales dropped 6.5%; sales were up …

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Financial Review

Neutrality Matters

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-02-26-2015.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair Noe DOW – 10 = 18,214 SPX – 3 = 2110 NAS + 20 = 4987 10 YR YLD + .05 = 2.01% OIL – 2.01 = 48.98 GOLD + 5.00 = 1210.20 SILV – .01 = 16.63   The Federal Communications Commission has voted to regulate broadband Internet service as a public utility. Tom Wheeler, the commission chairman, said the FCC was using “all the tools in our toolbox to protect innovators and consumers” and preserve the Internet’s role as a “core of free expression and democratic principles.”   The new rules, approved 3 to 2 along party lines, are intended to ensure that no content is blocked and that the Internet is not divided into pay-to-play fast lanes for Internet and media companies that can afford it and slow lanes for everyone else. Those prohibitions are hallmarks of the net neutrality concept.   Mobile data service for smartphones and tablets, in addition to wired lines, is being placed under the new rules. The order also includes provisions to protect consumer privacy and to ensure that Internet service is available for people with disabilities and in remote areas.   The FCC is taking this big regulatory step by reclassifying high-speed Internet service as a telecommunications service, instead of an information service, under Title II of the Telecommunications Act. The Title II classification comes from the phone company era, treating service as a public …

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Financial Review

The Dog Ate the Greek Proposal

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-02-23-2015.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair Noe DOW – 23 = 18,116 SPX – 0.64 = 2109 NAS + 5 = 4960 10 YR YLD – .07 = 2.06% OIL – 1.36 = 49.45 GOLD – 2.10 = 1202.80 SILV + .05 = 16.42   The S&P 500 climbed 0.6 percent last week to finish at record highs, the third record high of the year. The Dow rose to its first record of the year and the Nasdaq Composite closed at its highest level since March 2000, closing in on 5000. The Russell 2000 Index advanced 0.7 percent, also ending at a record Friday. Much of the stock market action has followed news of a compromise with Greece. At last week’s meeting, Greece signed up to all the conditions of its current bailout package and to continued international oversight, provided the Greeks come up with a list of reforms. Easier said than done; any reforms have to be acceptable to the Troika (the IMF, the ECB, and the EU, and subject to approval by all EU members) and at the same time it will have to be acceptable to Greeks who voted against the austerity plans of the Troika. The plan was supposed to be presented today, but that didn’t happen. Now the Greeks say they will present the reforms tomorrow. Given that Monday night was treated as a hard deadline for getting the Greek proposals …

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Financial Review

Theories on Apples and Applesauce

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-01-16-2015.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair Noe DOW + 190 = 17,511 SPX + 26 = 2019 NAS + 63 = 4634 10 YR YLD + .04 = 1.81% OIL + 2.32 = 48.57 GOLD + 17.70 = 1281.30 SILV + .83 = 17.88 Stocks bounced back after five sessions of losses. All 10 of the S&P 500 sectors were higher, though energy led the charge, rising 2.8%. U.S. crude oil futures settled up 5% after the International Energy Agency said there were signs that lower prices had begun to curb production in some areas. On the week, oil rose 0.7%, snapping a seven-week losing streak. The IEA report said that the market’s floor was still anybody’s guess, but “the sell-off is having an impact,” and “A price recovery – barring any major disruption – may not be imminent, but signs are mounting that the tide will turn. We love lower gas prices. A gauge of consumer sentiment jumped up to an 11 year high this month. The preliminary January reading on the University of Michigan’s consumer-sentiment index increased to 98.2, the highest level since January 2004, from a final December reading of 93.6. Also, more households were reporting increases in household incomes. Consumer inflation in December saw the biggest monthly drop in six years. Consumer prices, the CPI, fell 0.4% in December. You know the big driver for lower prices; energy prices plunged 4.7% in …

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Financial Review

Skim Just a Little

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-11-20-2014.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review DOW + 33 = 17,719 SPX + 4 = 2052 NAS + 26 = 4701 10 YR YLD – .02 = 2.33% OIL + 1.50 = 76.00 GOLD + 11.40 = 1195.50 SILV+ .12 = 16.35 Record high close for the Dow Industrials and the S&P 500 index. The Consumer Price Index, or CPI, measures inflation at the retail level; prices that you and I pay for stuff. Prices were unchanged in October at an annualized rate of 1.7%. Lower gasoline prices offset increases in housing (up 0.3%), medical care (up 0.2%) and airline fares (which increased 2.4% despite lower fuel costs). The price of gasoline fell 3% last month. The cost of food edged up 0.1% in October, but that was the smallest gain in four months. Fruits, vegetables, dairy and beef increased in cost, but pork, chicken, fish and eggs all declined. Food prices are up 3.1% from a year earlier. Excluding the up-and-down food and energy categories, core consumer prices rose 0.2%. Over the past 12 months the core rate of inflation has risen an unadjusted 1.8%. Initial jobless claims fell by 2,000 to a seasonally adjusted 291,000 in the week ended Nov. 15. The number of people who applied for new unemployment benefits totaled fewer than 300,000 for the 10th straight week. The National Association of Realtors reports sales of existing homes rose 1.5% in October to a …

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Financial Review

Bring Your Umbrellas

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-09-29-2014.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review DOW – 41 = 17,071 SPX – 5 = 1977 NAS – 6 = 4505 10 YR YLD – .04 = 2.49% OIL + .59 = 92.61 GOLD – 4.40 = 1216.00 SILV – .20 = 17.56 Starting with economic data: Consumer spending accelerated in August. Consumer spending rose 0.5% last month after being unchanged in July. Growth in personal income ticked up 0.3%, in line with forecasts. Some of the strength in spending came from a decrease in the saving rate, which eased back from a 1-1/2-year high in July. One area where spending dipped – housing. The National Association of Realtors issued its index of pending home sales for August. Pending sales dropped 1% from an 11 month high in July. Signaling that upcoming closings of existing homes are likely to slow down, the index of pending home sales hit a seasonally adjusted 104.7 in August, compared with 105.8 in July. The Fed’s preferred gauge of inflation was up 1.5% in August from a year earlier, down slightly from the reading in July. Excluding volatile food and energy prices, so-called core prices also advanced 1.5% year over year. Price increases measured by the PCE index slowed to a 1% annual pace late last year before accelerating during the spring and then plateauing this summer. A separate measure also shows inflation is largely in check. The Labor Department’s consumer-price index rose …

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Financial Review

Tuesday, June 17, 2014 – What Could Go Wrong?

What Could Go Wrong? by Sinclair Noe   DOW + 27 = 16,808 SPX + 4 = 1941 NAS + 16 = 4337 10 YR YLD + .06 = 2.65% OIL – .30 = 106.60 GOLD un = 1272.70 SILV + .09 = 19.86 The FOMC, the Federal Open Market Committee started two days of meetings today; tomorrow they are expected to announce more of the same. The FOMC is largely expected to taper its asset purchase program by $10 billion to $35 billion. Effective July 1, the Fed is expected to lower its asset purchases to $15 billion in agency mortgage backed securities (MBS) and $20 billion in Treasuries. The Fed is also expected to maintain its current forward guidance language on federal funds rate support; in other words, they will keep telling us that rates might increase sometime next year.   The committee is likely to make some upgrades to its description of the economic outlook in its economic projections. The committee will probably need to reduce its 2014 real GDP growth forecast to take into account the Q1 disappointment, and we can probably expect the committee to reduce its unemployment rate forecast and lift its inflation forecast slightly.   The consumer-price index climbed a seasonally adjusted 0.4% in May from a month earlier. It marked the fastest increase since February 2013 and doubled the pace of economists’ forecasts. Excluding food and energy components, so-called core prices increased 0.3%, the fastest pace since August 2011. From a year …

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Financial Review

Friday, May 16, 2014 – Nervous About Recovering in the Recovery

Nervous About Recovering in the Recovery by Sinclair Noe DOW + 44 = 16491 SPX + 7 = 1877 NAS + 21 = 4090 10 YR YLD + .02 =  2.52% OIL + .68 = 102.18 GOLD – 4.10 = 1293.70 SILV – .11 = 19.45   Stocks were all over the place this week; we had record highs for the Dow Industrial Average and the S&P 5oo Index, topping 1900 for the first time, even as small caps slipped and internet stocks tumbled. For the week, the Dow slipped 0.6 % and the S&P 500 dipped 0.03 %, while the Nasdaq gained 0.5 %. Bonds enjoyed a very nice week indeed, with the yield on the 10 year Treasury note moving from a high for the week of 2.66% to a low of 2.47%. Isn’t it awesome when the Dow hits a record high but everything else flatlines or shrinks? Maybe we are in a recovery, but maybe we need to recover from the recovery. Recent economic data has been mixed, and reports released Friday added to concerns about the lackluster recovery. The preliminary Reuters / University of Michigan consumer sentiment index for May was at 81.8, down from 84.1 in April. Housing starts increased in April at a seasonally adjusted annual rate of 1,072,000. This is 13.2 % above the revised March estimate of 947,000 and is 26.4 % above the April 2013 rate of 848,000. Earlier in the week we got the PPI and CPI inflation numbers. …

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Financial Review

Tuesday, April 15, 2014 – Yellen in the Lions’ Den

Yellen in the Lions’ Denby Sinclair Noe DOW + 89 = 16,262SPX + 12 = 1842NAS + 11 = 403410 YR YLD – .01 = 2.62%OIL – .22 = 103.83GOLD – 24.20 = 1303.40SILV – .41 = 19.66 Stocks were all over the place today. We started with triple digit gains for the Dow Industrials, dipped to triple digit losses, then back into positive territory for the close with the major indices closing just below their morning highs. This kind of volatility does not engender confidence; it does warrant caution. The utilities sector gained 1.3% and finished ahead of the other groups, extending its YTD gain to 11.8%; the biotech ETF added 1%, while the broader healthcare sector advanced 1.1%.Tech stocks have been beaten up quite a bit over the past couple of weeks. The Nasdaq 100 Tech Index (NDXT) is down 7% since April 1st. The Nasdaq Composite has exhibited weakness, but not to the point of meeting the definition of a correction; it would take a slide to 3,922 to mark a 10% fall from the March 5 closing high at 4,357; a 10% pullback from the March 6 intraday high of 4,371 would be achieved at 3,934. The Labor Department’s Consumer Price Index, or CPI, increased 0.2% in March after posting a 0.1% increase in February. Excluding volatile food and energy prices, core prices ticked up 0.2%.Prices rose 1.5% for the 12 months ending in March. That is up from February’s year-over-year reading of 1.1%. Core prices …

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