26 Jun 2009

Posted at 14:08h in The Friday Brief by
In the days of sailing ships one of a captain’s greatest fears was being becalmed in the Doldrums. Ships could be trapped for weeks without sign or hope of a breeze powerful or consistent enough to propel them safely out of the morass. These regions exist at the earth’s equator and are characterized by extreme low pressures, where the prevailing winds are calm and variable.

05 Jun 2009

Posted at 15:35h in The Friday Brief by
It can be argued that since September of 2008 the stock market has experienced two distinct bear markets; one starting in September 2008 and one starting February 10th 2009. It could also be argued that three-month 40% rally we now enjoy eliminates the second bear market leaving only the first to battle.  

13 Mar 2009

Posted at 16:46h in The Friday Brief by
This afternoon we find the S&P 500 advancing for the fourth day, up nearly 12% for the week. News on Tuesday that Citigroup CEO Vikram Pandit’s remarks in an internal memo saying the bank is having its best quarter since 2007 and comments from regulators in Washington suggesting they may reinstate rules that limit short selling sparked the rally. By Wednesday it looked like it would run out of steam when Thursday’s Retail Sales report demonstrated there was still life in the consumer. The possibility that consumer, the largest part of the US economy combined with the picture Bernie Madoff swiftly and justly being escorted off to jail in handcuffs gave the market it’s second powerful boost upward. This week’s move dramatically demonstrates how fast markets can move on relatively little information.

16 Jan 2009

Posted at 15:41h in The Friday Brief by
New revelations about the weakness of America’s banks have kept the pressure on stocks. The S&P 500 is down 5.2% at the moment but remains 14% above the market’s low reached November 20, 2008. A major reason stocks are holding up in the face of relentless economic news is their yield. Dividends paid on S&P 500 stocks are roughly 3.5%, which compare very favorably to the 10-year Treasury yield of 2.4%. Stocks are also up on investors’ high hopes for Obama’s economic team and their ultimate stimulus package.