Forward we look and consider, “… the ramifications of a Fed that continues to increase the Fed Funds rate and moves forward with plans to slowly remove QE.” They compare the current Fed stimulus QE period of current policy to the prior three and ask “How Much is Too Much?” Wait until you see their chart.
Bottom line: Should September prove as challenging as periods past, despite the second highest valuation level in history, I remain modestly constructive on equities.Īlso, I share with you a short but thoughtful piece from my friends at 720Global. You’ll find a number of my favorite indicators, such as the Ned Davis Research CMG Long/Flat Index, Don’t Fight the Fed and a chart that measures Volume Supply vs. Switching gears, this next chart advises to beware of a slip in September:īuy a September dip? As you’ll see in the Trade Signals section below, the weight of collective evidence continues to support the continuation of the equity bull market trend. The equity market remains richly priced and earnings growth is unlikely to change that picture any time soon. Economic growth has a high correlation with corporate earnings growth. Current high global debt and aging demographics will keep growth lower for longer. Fewer workers, producing fewer things is not good for growth. GDP growth to remain low for some time to come. Following are a few charts I found interesting and hope you do as well:īottom line: Expect the overall trend in U.S.
Overall, like storms past, it will be a temporary economic bump. Longer term, as the insurance funds kick in, the rebuild will provide an economic boost. From an economic perspective, the damage will create a short-term drag on U.S. Houston’s economy is the fourth largest in the U.S. Our collective thoughts and prayers are with you. Across the country and from many parts of the world, a tidal wave of kindness is coming your way. Much more will be needed in the days ahead. It has been heartwarming to watch the countless random acts of kindness in the wake of the current challenges. Thankfully, my kid’s school has organized the donation drive. I’m heading out mid-morning to help load a support truck headed for Houston. The car is loaded with clean clothes and dog food. That over time can turn into a tidal wave affecting the lives of many.” The gift of kindness may start as a small ripple