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

Dog Day Advance

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-08-17-2015.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: iTunes | Android | RSSFinancial Review by Sinclair Noe for 08-17-2015 DOW + 67 = 17,545 SPX + 10 = 2102 NAS + 43 = 5091 10 YR YLD – .05 = 2.15% OIL – .62 = 41.88 GOLD + 3.70 = 1118.40 SILV + .07 = 15.42   A reading of New York-area manufacturing conditions fell in August. The Empire State general business conditions index nose-dived to a reading of negative 14.9, from positive 3.9 in July, marking the worst level since April 2009.   The National Association of Home Builders/Wells Fargo housing market index rose 1 point to 61, marking the highest level since Nov. 2005. Any reading above 50 indicates “good” conditions. NAHB says the report is consistent with their forecast for a gradual strengthening of the single-family housing sector in 2015.   Japan’s economy contracted in Q2 as overseas demand for Japanese goods slumped and households spent less, raising the possibility the government will act to support the country’s weak recovery. GDP shrank 1.6% on an annualized basis in the April-June quarter.   The yuan started the week on stable footing after the People’s Bank of China set the currency’s daily reference rate at 6.39 per dollar – in line with Friday’s close. The move signals Beijing is willing to cede more control to market forces, following last week’s record devaluation that saw the currency plunge 3.6%. Shanghai +0.7%. Shenzhen +1%.   Rounding up support for Greece’s fresh aid package, German Chancellor …

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Financial Review

The Value of Everything

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-07-30-2015.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: iTunes | Android | RSSFinancial Review by Sinclair Noe DOW – 5 = 17,745 SPX + .06 = 2108 NAS + 17 = 5128 10 YR YLD – .01 = 2.27% OIL – .27 = 48.35 GOLD – 8.40 = 1089.30 SILV – .08 = 14.83   Gross domestic product rose at a 2.3% annual rate from April to June, missing expectations for 2.6% growth. First quarter GDP was revised to show 0.6 percent growth after previous reports showed a 0.2 percent downturn. The latest reading on GDP was propelled by higher consumer spending on big-ticket items such as new cars and trucks and the strongest housing market in years. Personal spending accounted for two percent of the 2.3% headline increase.   Builders increased spending on new home construction at a 6.6% clip in the spring, especially for townhouses, condos and apartment units. That follows 10% gains in the prior two quarters. US exports, meanwhile, snapped back with a 5.3% increase after a 6% drop in the first quarter. Imports rose at a slower 3.5% pace. The improved trade figures also gave the economy a small boost.   Business investment was weak again. Outlays on equipment declined 4.1% and the value of inventories fell slightly to $110 billion from $112.8 billion. Spending on structures such as oil platforms fell 1.6%, largely because of the drop in oil prices. The story on the economy remains consistent: strong consumption, weak investment.   …

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Financial Review

Proactive in the Face of Volatility

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-05-22-2015.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: iTunes | Android | RSSFinancial Review by Sinclair Noe DOW – 53 = 18,232 SPX – 4 = 2126 NAS – 1 = 5089 10 YR YLD + .03 = 2.21% OIL – .78 = 59.94 GOLD SILV   Central bankers are speaking out. Earlier today, Mario Draghi, the President of the European Central Bank reiterated his call for euro zone countries to reform their economies, warning that future growth would remain modest. Draghi said: “It should…be clear that the argument that accommodative monetary policy constitutes an excuse for governments and parliaments to postpone their reform efforts is incorrect. Recently, economic conditions have improved somewhat in Europe…but growth is too low everywhere.”   This afternoon Federal Reserve chairwoman Janet Yellen delivered a speech in Rhode Island. Yellen said: “the U.S. economy seems well positioned for continued growth.” And she said: “If the economy continues to improve as I expect, I think it will be appropriate at some point this year to take the initial step to raise the federal funds rate target and begin the process of normalizing monetary policy.”   The Fed has consistently stated that they would be data dependent, but today Yellen said “Delaying action to tighten monetary policy until employment and inflation are already back to our objectives would risk overheating the economy.” So, apparently data dependent is subject to interpretation.   Yellen expressed confidence that the economy will get better and the first quarter weakness …

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Financial Review

Month End Review

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-04-30-2015.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: iTunes | Android | RSSFinancial Review by Sinclair Noe DOW – 195 = 17,840 SPX – 21 = 2085 NAS – 82 = 4941 10 YR YLD + .01 = 2.05% OIL + 1.19 = 59.77 GOLD – 20.60 = 1185.00 SILV – .44 = 16.20   For the month, the Dow was up 0.4 percent, the S&P 500 gained 0.9 percent and the Nasdaq rose 0.8 percent. For the month of April, the dollar index fell about 3.7 percent. Some month end portfolio buying pushed yields on ten year notes to 2.05% after hitting a 7 week high of 2.11% earlier in the session. The big mover in April was in the energy market, where crude oil jumped more than 21%. S&P 500 earnings for the first quarter now are forecast to have increased 1.1 percent from a year ago, Thomson Reuters data showed, while revenue is forecast to be down 3.2 percent.   The Commerce Department reports consumer spending rose 0.4% in March as households stepped up purchases of big-ticket items like automobiles; that follows a 0.2% gain in February. The savings rate fell for the first time in four months to 5.3% from 5.7%. A year earlier, Americans were saving at a 4.8% rate. Consumer spending rose 1.9% in the first quarter, down from 4.4% and 3.2% in the prior two quarters. That might indicate there is pent-up demand, but a rebound in economic activity could be …

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Financial Review

Groping Along

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-03-30-2015.mp3Podcast: Play in new window | Download (Duration: 13:15 — 6.1MB)Subscribe: iTunes | Android | RSSFinancial Review by Sinclair Noe   DOW + 263 = 17,976 SPX + 25 = 2086 NAS + 56 = 4947 10 YR YLD + .01 = 1.96% OIL – .19 = 48.68 GOLD – 13.40 = 1186.00 SILV – .28 = 16.79   The Commerce Department reports consumer spending rose just 0.1% in February; that follows a decline in January. The small increase in spending in February and outright decline in January suggest the economy failed in early 2015 to match the pace of growth at the end of last year. Gross domestic product is forecast to expand just 1.4% in the first quarter, down from 2.2% in the fourth quarter and 5% in the third quarter. Part of the problem might be harsh winter weather; if that is the case, we might expect a rebound in consumer spending in the spring.   Or maybe the American consumer is tired of spending, and is actually starting to save. The saving rate jumped in February to 5.8 percent, the highest since December 2012 and up from 4.4 percent just three months earlier. The savings rate slumped to as low as 1.9 percent in the run-up to the recession, a sign too many Americans were spending beyond their means. Since then, consumers have been trying to clean up their finances.   The National Association of Realtors said its pending-home-sales index rose 3.1% to 106.9 after a …

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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: iTunes | 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 price …

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Financial Review

Holy Grail

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-03-02-2015.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: iTunes | Android | RSSFinancial Review by Sinclair Noe DOW + 155 = 18,288 SPX + 12 = 2117 NAS + 44 = 5008 10 YR YLD + .08 = 2.08% OIL + .06 = 49.82 GOLD – 7.80 = 1206.90 SILV – .22 = 16.46   February was the best month for stocks since October 2011. The S&P 500 gained 5.5% in February. March is off to a fine start. The Dow Industrial Average closed at a record high. The S&P 500 closed at a record. The Nasdaq Composite hit 5000 for the first time in 15 years. And if you wonder why we celebrate when the indices hit records, it is because 15 years ago we didn’t know it would take 15 years to get back to these levels.   Earnings season is pretty much over and it wasn’t all that pretty. With 485 of 500 S&P 500 companies reporting, FactSet says the blended growth rate is only 3.7%. Without Apple that number shrinks to only 2% but then again if you take out energy, it balloons to nearly 7%. Estimates have been revised lower, which is typical; companies try to ratchet down expectations, but this is different. All sectors are showing expectation deterioration, not just energy.   Earnings growth has slowed, and valuations are a little on the pricey side, and expectations are down. So, why are stocks at record highs? Well, start with the idea that the …

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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: iTunes | 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 utility. …

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Financial Review

Job Seekers Find Their Place Again

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-02-06-2015.mp3Podcast: Play in new window | Download (Duration: 13:15 — 6.1MB)Subscribe: iTunes | Android | RSSFinancial Review by Sinclair Noe DOW – 60 = 17,824 SPX – 7 = 2055 NAS – 20 = 4744 10 YR YLD + .12 = 1.94% OIL + 1.60 = 52.08 GOLD – 31.20 = 1234.30 SILV – .54 = 16.79   The U.S. added 257,000 new jobs in January. The unemployment rate edged up to 5.7% from 5.6%, but that’s because more people looked for jobs. The January report topped expectations of 230,000 to 245,000 new jobs.   The Labor Force Participation Rate increased 0.2% to 62.9%. The Labor Department’s survey of households, used to derive the unemployment rate, showed about 1.05 million people entered the labor force and 759,000 found work. These numbers also reflect new estimates on the size of the population. Even as the labor-force participation rate rose last month, it’s held to roughly the same level for the past year and a half. The hope is that there is a trend developing of more people looking for work. Consumers believe job prospects have improved. That perception was evident in last week’s confidence report that showed a jump in the number of consumers who think jobs were “plentiful” last month.  Better confidence in job availability should lead to a jump in the number of people quitting. That’s one data series the Fed tracks as a sign of labor-market tightening beyond what the jobless rate says.   The economy has now …

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