Restaurant Sales Sag The restaurant sales growth has been rough in 2016 and 2017. Previously, restaurant sales were thought to be an indicator of future economic growth. This is why you need to always question every indicator. There’s no full proof method that will give you results when it comes to
Options Adjusted Bond Spread We’ve discussed that at this point in the business cycle the yield spread between treasuries and junk bonds usually increases to reflect the increased risk in the market. The chart below is a great depiction of the options adjusted bond spread because it shows the variou
Bitcoin Futures Overshadow Record Day For Stocks Monday saw the Dow reach its 66th all-time high this year which is 3 shy of tying the record. The S P 500 was up 0.32% and the VIX was down 2.51% to 9.34. Even with the market putting an explanation point on its great year, Bitcoin stole the headlines
Tax Bill Update Previous articles have shown estimates of the GOP tax plan done by the Joint Tax Committee which have it leading to high deficits and not much economic growth. To counter some of its negativity, I have the chart below which shows that the CBO underestimated the GDP growth in 2003 aft
BLS Reports Shows Great Jobs Growth The BLS Report beat the ADP report as it showed 228,000 jobs were added in November. This beat expectations by 28,000. The October report was revised lower by 17,000 and the September report was revised up by 18,000, making the revisions a wash. It’s interesting t
Macro Trading Trends The correlations between sectors have declined in the past few months. This means the market is bifurcated. To uses a common Wall Street phrase, ‘it’s a stock pickers market’. The correlations may have fallen in 2000 because only the tech stocks were going up. During the financi
Stocks Are Boring. The Triple Digit Returns Are In Bitcoin...? If you experienced the housing market bubble 12 years ago or the tech bubble in the late 1990s, you’ll see similarities with bitcoin. I’ve seen speculators claim buying stocks to get an 8% return is silly when you can get higher returns
ADP Report Solid The top economic reports of the week are the BLS and the ADP employment reports. The ADP report was good as it showed 190,000 jobs created. This is the third lowest growth in the past 12 months. Sustained growth below 200,000 would indicate the labor market has little slack to give.
Spending Plan To Be Extended Temporarily The GOP is working to get the temporary spending plan passed before the deadline on December 8th. Trump discussed the possibility of the government shutting down, but that’s unlikely. The government is great at kicking the can down the road which is what this
High Valuations Exuberance Are The Main Bearish Arguments The best argument the bears have is valuations are too high as the stock market continues going up. Personally, I can’t see stocks falling with this type of earnings momentum and economic growth. That being said, the Shiller PE is at 31.9 whi
