I firmly believe that the stock market is way oversold. Current levels for the major indices and most stocks will be significantly higher within the next six to twelve months. Prices reflect a significant global recession driven by the crisis in the financial system. The near-term is being driven by emotional trading in thin and […]
I think the biggest benefit of the Treasury takeover of Fannie Mae and Freddie Mac is that it will unclog the market for mortgage backed securities. With an explicit US Treasury guarantee, yield spreads on Fannie and Freddie debt should drop sharply. Inventory of MBS should decline. Banks should feel comfortable lending again to quality […]
Today’s New York Times had a good article explaining why the lending availability is drying up in the US. This is a very important point for the near-term market and economic outlook. Our economy requires easily available credit to function near maximum efficiency. Credit availability went over the top in the past few years expanding […]
AdAge.com posted an article analyzing census data from the perspective of marketers. The data was interesting although I guess not all that surprising once it was laid out. I think that the implications go far behind marketing. Here are the key conclusions: (1) the US is aging with the average age for the head of […]
This rally has been really impressive. The S&P 500 is off less than 3% this year as of Thursday’s close, hardly a blip considering all the angst earlier this year and late last year. I think the largest reason for the rally has been that earnings have exceeded expectations. According to Ned Davis Research, the […]
There is no doubt that flood of money into private equity funds and the subsequent investment of these funds in buyouts of public corporations has contributed greatly to the 2006 bull market. Conventional wisdom is that private equity buyouts of public companies will continue at its recent pace, providing support to current public equity valuations […]
Despite September’s history as the worst month of the year, September 2005 turned out pretty well. The S&P 500 produced a gain of 69 basis points and a total return of 84 basis points. The NASDAQ and the Russell 2000 did produce negative returns on a price only basis for September but both indices fell […]
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