Financial Review

Hippity Hoppity

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-04-17-2017.mp3Podcast: Play in new window | Download (Duration: 13:15 — 7.6MB)Subscribe: iTunes | Android | RSS…..Markets bounce after a couple of weak weeks. GDP forecasts slip. Earnings season kicks into gear. Where will earnings come from? Eurozone and emerging markets. Mnuchin: tax reform “not realistic”. United tops earnings forecast. Netflix beat earnings but missed on subs. HCA, not enough emergencies. Financial Review by Sinclair Noe for 04-17-2017

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Financial Review

Times Change

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-09-30-2015.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: iTunes | Android | RSSFinancial Review by Sinclair Noe for 09-30-2015   DOW + 235 = 16,284 SPX + 35 = 1920 NAS + 102 = 4620 10 YR YLD + .01 = 2.06% OIL – .14 = 45.09 GOLD – 12.40 = 1116.30 SILV – .13 = 14.62   This is the last trading day of the third quarter. China’s main stock market posted its worst quarter since 2008 and its smaller Shenzhen index, posted its worst quarter in at least two decades. Markets in Singapore and Indonesia are set to post their worst quarters since the financial crisis. The MSCI Asia ex-Japan Index fell 19.1% from the beginning of the quarter. The Nikkei closed out its worst quarter since 2010 and the ASX its worst since 2011.   European stocks moved higher today, but not enough to recover from the worst quarter in 4 years. The Stoxx Europe 600 index is down about 9.5% for the quarter. Germany’s DAX index down 12% for the quarter. France’s CAC index posted a quarterly loss of 7.3%, and the UK’s FTSE 100 down 7.7%. The Eurozone is back in deflation. Consumer prices slipped 0.1% year-over-year in September.   The major U.S. averages had a rough third quarter. Concerns about spillover from slowdown in China and the timing of a Federal Reserve rate hike sent markets into correction territory, or more than 10 percent below their 52-week highs, in late August. The …

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Financial Review

First Do No Harm

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-09-17-2015.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: iTunes | Android | RSSFinancial Review by Sinclair Noe for 09-17-2015 DOW – 65 = 16,674 SPX – 5 = 1990 NAS + 4 = 4893 10 YR YLD – .08 = 2.22% OIL – .25 = 46.90 GOLD + 11.80 = 1132.00 SILV + .21 = 15.24   The Fed will raise rates someday, just not today. The FOMC issued their statement today, and they left interest rates unchanged, again. The biggest change in the wording dealt with international markets, saying: “Recent global economic and financial developments may restrain economic activity somewhat and are likely to put further downward pressure on inflation in the near term.”   The statement also included this new line: “The Committee continues to see the risks to the outlook for economic activity and the labor market as nearly balanced, but is monitoring developments abroad.” You may recall that China was also frequently referenced in the Beige Book published a couple of weeks ago in preparation for this FOMC meeting.   The Fed also released their economic projections and they seem to be forecasting more of the same: GDP just over 2% for 2015, the unemployment rate finishing the year at 5%, inflation still significantly short of their target, and the outlook for a rate hike before the end of the year. But don’t bet on it; this Fed might never get off the Schneid. There will be growing pressure for a rate hike, if …

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Financial Review

Discretionary Reading

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-08-19-2015.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: iTunes | Android | RSSFinancial Review by Sinclair Noe for 08-19-2015 DOW – 162 = 17,348 SPX – 17 = 2079 NAS – 40 = 5019 10 YR YLD – .07 = 2.13% OIL – 2.02 = 40.60 GOLD + 16.60 = 1135.10 SILV + .44 = 15.41   A new CPI report this morning shows inflation remains muted. The consumer price index, a measure of prices at the retail level, rose 0.1% in July to mark the smallest increase in three months. Yet the cost of housing, the largest expense for most Americans, continued to rise, up 0.4% last month, reflecting the biggest gain in more than eight years. And housing expenses have climbed 3.1% in the past 12 months, the largest annual increase since 2008. The prices of most other consumer goods were little changed in July. Food prices climbed 0.2% while energy prices rose a smaller 0.1%. Excluding food and energy, so-called core consumer prices also advanced 0.1% in July. Aside from shelter, prices for clothes and medical care also rose.   Even though energy prices were up slightly in July, that might not last; eventually the price at the pump for gasoline should reflect the price of oil, which has now dropped to a 6 year low of $40.60 per barrel. Based upon historical pricing for oil and gas, we should be paying about $2.00 to $2.10 a gallon at the pump. Gas prices should …

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Financial Review

Because it’s Friday

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-08-14-2015.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: iTunes | Android | RSSFinancial Review by Sinclair Noe for 08-14-2015 DOW + 69 = 17,477 SPX + 8 = 2091 NAS + 14 = 5048 10 YR YLD + .01 = 2.20% OIL – .10 = 42.13 GOLD + .10 = 1115.80 SILV – .18 = 15.34   For the week, the Dow rose 0.6 percent, the S&P 500 added 0.7 percent and the Nasdaq gained 0.1 percent.   Wholesale prices climbed at a slower pace in July, as energy prices dropped. The 0.2 percent increase in the producer-price index followed a 0.4 percent gain in June. Even with the recent increases, producer prices dropped 0.8 percent over the past 12 months. Wholesale prices excluding food and energy rose 0.3 percent for a second month, and those costs were up 0.6 percent from July 2014.   Industrial production climbed 0.6% in July; there were also upward revisions of 0.1% each in February, May and June. Capacity utilization for the industrial sector increased 0.3 percentage point to 78%. The auto sector posted a 10.6% surge in production.   Looking to capitalize on rising demand, General Motors has increased its rate of production on larger trucks and SUVs, and added Saturday overtime shifts at a Texas plant. The move could see 48,000 to 60,000 additional vehicles for the 2016 model year. Make hay while the sun shines.   The University of Michigan’s consumer sentiment index edged slightly lower to a reading of 92.9 …

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Wednesday, February 12, 2014 – Which Way the Wind Blows

Which Way the Wind Blows by Sinclair Noe DOW – 30 = 15,963SPX – 0.49 = 1819NAS + 10 = 420110 YR YLD + .04 = 2.76%OIL + .33 = 100.27GOLD + .90 = 1292.80SILV unch = 20.34 After a four day rally, the stock market came back to a dose of reality. Just a reminder that the Fed has started gradually reducing the amount of money it pumps into the economy. The move could hardly have been a surprise, because the Fed announced as early as last spring that it would begin doing so by the end of 2013. Now, it’s happening, and likely won’t change, and Janet Yellen said the rest of the world needs to adjust because the Fed has set its course. That has made for shaky markets around the world. Remember that about a month ago, we started worrying about emerging markets. China said their economy was slowing down; that in turn will hurt the exports of commodity producers, weakening their trade balances. The big question now is how much further growth in China will slow. A serious cutback in China’s demand would not just harm emerging markets’ shipments directly to China, it would also cause further erosion in the already falling world prices for emerging markets’ coal, copper, palm oil and other commodities. China is also dealing with a shadow banking system ripe with potential defaults. But that isn’t the only problem in the world. Many of those emerging markets also have unique economic …

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Thursday, January 30, 2014 – Where Water Flows

Where Water Flowsby Sinclair Noe DOW + 109 = 15,848SPX + 19 = 1794NAS + 71 = 412310 YR YLD + .02 = 2.69%OIL + .59 = 97.95GOLD – 24.60 = 1244.10SILV – .57 = 19.24 Gross domestic product grew at a 3.2% pace in the fourth quarter of 2013, which was down from the 4.1% growth in the third quarter. Consumer spending rose at a 3.3 percent rate, the strongest since the fourth quarter of 2010. Inventories increased $127 billion, the most since the first quarter of 1998. That added 0.42 percentage point to GDP growth. Inventories had risen $115 billion in the third quarter, contributing 1.67 percentage points to output. Excluding inventories, the economy grew at a 2.8% rate, up from the third-quarter’s 2.5% rate. We might reasonably expect inventories to decline again in the first quarter. Consumption in the fourth quarter came at the expense of saving. The saving rate slowed to 4.3% in the fourth quarter from 4.9 % in the prior period. Income at the disposal of households after accounting for inflation rose at a tepid 0.8% rate. That was a sharp slowdown from the 3.0% pace in the third quarter. Income is one of the biggest constraints on growth. Exports rose at their fastest pace in three years. Exports combined with declining petroleum imports helped narrow the trade deficit. Business spending on equipment accelerated at a 6.9% rate in the fourth quarter after rising at only a 0.2% pace in the prior three months, …

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Tuesday, January 28, 2014 – If I Had a Hammer

If I Had a Hammer by Sinclair Noe DOW + 90 = 15,928SPX + 10 = 1792NAS + 14 = 409710 YR YLD – .02 = 2.75%OIL + 1.50 = 97.22GOLD – .80 = 1256.70SILV – .13 = 19.66 The State of the Union is… tonight. President Obama will describe how he will use his pen and phone to overcome the Do-Nothing Congress, and the Republicans have ironically lined up not one, but three responses to refute the idea they are nothing more than obstreperous obstructionists. Everybody from the Pope to the big wigs in Davos have been talking about inequality and it will likely be a major theme in tonight’s speech. Job and wage growth has been broken since the 1990s. Median family incomes grew very slowly from 1979 to 1999, peaked that year, and have fallen 13% since. The economy has recovered since the near financial meltdown of 2008, but it has been the weakest recovery since the Great Depression, and one of the reasons it has been such a slow recovery is that the spoils of recovery have been unevenly distributed. Even though we have seen job growth in the past 54 months, 6 of the 10 fastest growing job categories are in low paying service sector positions, such as retail clerk and home health care aids. Middle class income is sinking; the ranks of the poor are rising; and the economic gains only go to the top, or 95% of all economic gains in the “recovery” …

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Monday, January 27, 2014 – Sniffing Out Weakness

Sniffing Out Weakness by Sinclair Noe DOW – 41 = 15,837SPX – 8 = 1781NAS – 44 = 408310 YR YLD + .04 = 2.76%OIL – .94 = 95.70GOLD – 12.50 = 1257.50SILV – .22 = 19.79 Last week was rough for the Dow Industrial, and today started with the blue chips in the red but not by much; it even looked like we might finish in positive territory. Nahh. The markets have been trending downward over the last week due to a mix of concerns. Emerging market strains, anxiety over tapering by the Federal Reserve, and weak manufacturing data from China likely contributed to a pullback. Also, new home sales were weak in December. The international problems started with a report that Chinese manufacturing may contract for the first time in 6 months. Then Argentina’s central bank limited dollar sales to preserve international reserves that had fallen to a seven-year low. Then there were concerns about a default in the shadow banking system in China. Then there concerns about a corruption scandal for Prime Minister Erdogan’s cabinet in Turkey. Protesters occupied municipal buildings in the Ukraine. Then the South African rand dropped big. Then the whole thing spread. I don’t know what happened in Mexico but the peso took a hit. Bank of America analysts recommended buying the Mexican peso on Nov. 24 as one of their top two Japan-related trades for this year, predicting a rally that would have boosted the currency’s value to 8.4 yen. Instead, the …

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Friday, January 24, 2014 – Bulls, Bears, and Bonuses

Bulls, Bears, and Bonuses by Sinclair Noe DOW – 318 = 15,879SPX – 38 = 1790NAS – 90 = 412810 YR YLD – .04 = 2.73%OIL – .41 = 96.91GOLD + 4.40 = 1270.00SILV – .11 = 20.01 The Dow has fallen every day this week, leaving it down more than 3%. That decline is the Dow’s worst weekly performance since mid-May 2012. Meanwhile, the S&P 500 is down 2.5% since last Friday. That’s the index’s worst weekly slide since early November 2012. All of the sudden, everybody seemed concerned about political and economic problems in Turkey, Argentina, and of course, China. The Turkish lira hit a record low and the South African rand fell to five-year low against the dollar. The Argentine peso had its sharpest decline in 12 years, going back to the 2002 financial crisis in that country; and the government abandoned its long standing policy of intervening to support the peso currency. Such moves are crucial factors for big, institutional foreign investors because exchange rate losses can easily wipe out any gains in stocks and bonds of emerging countries. Right now, the losses haven’t turned into a rout, but there is concern that the turn may push big institutional investors to cut losses and run as the effect of falling currencies becomes too painful to bear. Every emerging market crisis is first-and-foremost a currency crisis. For example, South African government debt was slightly positive in rand terms in 2013. But in dollars terms, it lost more …

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