Posts Tagged ‘used car prices’

Used Cars and the Inflation / Deflation Tug of War

Used car prices are going up – is this a sign of recovery and inflation or a complicated symptom of a deflationary environment?  This debate illustrates, perhaps, why the same economic data can be interpreted in opposite manners by intelligent people. – Ilene

Used Cars and the Inflation / Deflation Tug of War

Courtesy of Jake at Econompic Data

Scott Grannis, of the blog California Beach Pundit, is quickly becoming my new favorite blogger to disagree with because he:

  • Provides intriguing data
  • Has a strong opinion
  • Supports his opinion well
  • These opinions run counter (in almost every case) to mine

In general he believes in the recovery and inflation, whereas I don’t and believe deflation is a real possibility.

One example was yesterday’s post regarding ISM Prices. In his view, the jump in ISM prices (by jump I mean they finally didn’t fall month over month) means deflation is no longer a threat. On the other hand, I believe that may be a result of the temporary jump we saw in commodities. He continues his ‘don’t worry about deflation’ message with yesterday’s post that (again) gave me the exact OPPOSITE initial reaction. Here goes:

According to Manheim Consulting, used vehicle prices jumped 16.4% in the first half of 2009 on a seasonally adjusted basis. Once more we are reminded that a weak economy and rising unemployment do not necessarily create deflationary conditions.

In other words, an increase in the price of used cars (off a large previous fall) proves that deflation is no longer an issue and we should (if anything) worry about inflation.

Manheim Used Vehicle Value Index

He adds:

I think the rise in prices also has something to do with the return of money velocity. Consumers retrenched violently in the fourth quarter of last year, hoarding cash and repaying debt in the face of tremendous uncertainty. Money velocity collapsed. Now that confidence is returning, money is getting spent again. The economy is recovering some of the ground it lost.

Using what I refer to as the logic test, this makes no sense. If people are trading down (i.e. increasing demand for a cheaper / used good) this has deflation written all over it (not necessarily for that good, but for the broader economy). My logic and posted in


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Zero Hedge

Three Hanjin Ships Stranded Off California Coast

Courtesy of ZeroHedge. View original post here.

Earlier today we reported that in an surprising and abrupt development, one which may lead to ripple effects on global supply-chains and worldwide "just-in-time" logistics, the biggest South Korean shipping company and the world's 7th largest container shipper, Hanjin Shipping, filed for bankruptcy leaving its assets frozen as ports from China to Spain denied access to its vessels.

 

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Phil's Favorites

Pending Home Sales Rise 1.3%: Housing Liftoff?

Courtesy of Mish.

Signs of liftoff in housing as well as manufacturing are nothing more than an illusion in statistics.

This morning, the Pending Home Sales Index jumped 1.3%.

That is welcome news to those who believe chasing rising prices is a good thing. Beneath the good news, pending sales jumped 1.3% after a June revision from +0.2% to -0.8%.

Econoday Highlights

Pending home sales jumped higher in July but from a June that is now revised sharply lower. The July index came in at 111.3, a level that is only marginally above June’s initial reading of 111.0 but is 1.3 percent above th...



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ValueWalk

Dividend Safety Analysis: Southern Company (SO)

By Simply Safe Dividends. Originally published at ValueWalk.

This week, I will be taking a look at the dividend safety of Southern Company (SO). If there are other companies you would like me to analyze for dividend safety, please leave a comment at the bottom of this article.

My full thesis on Southern can be seen here, but I will be focusing on the company’s Dividend Safety Score in this article.

Before analyzing Southern’s dividend, let’s review how the company makes money. After all, the most effective investors understand that one of the best pieces of investing advice is to only invest in simple, easy-to-understand businesses.

...

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Chart School

Moving Averages: August Month-End Update

Courtesy of Doug Short's Advisor Perspectives.

The S&P 500 closed August with a monthly loss of 0.12% after a gain of 3.56% last month, its first monthly loss since February. All three S&P 500 MAs are signaling "invested" and all five Ivy Portfolio ETF MAs are signaling "invested".. In the table, monthly closes that are within 2% of a signal are highlighted in yellow.

The Ivy Portfolio

The above table shows the current 10-month simple moving average (SMA) signal for each of the five ETFs featured in The Ivy Portfolio. We've also included a table of 12-month SMAs for the same ETFs for this popular alternative strategy.

For a ...



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Market News

News You Can Use From Phil's Stock World

 

Financial Markets and Economy

Why September Could Be Huge for Markets All Around the World (Bloomberg)

The first debate of the U.S. presidential campaign. A Group of 20 (G20) central bank interest rate announcement nearly every other trading day. And a key meeting among commodity nations around the world.

Treasury Secretary Lew Criticizes EU Decision to Issue Apple $14.5 Billion Tax Bill (The Wall Street Journal)

WASHINGTON—U. S. Treasury Secretary Jacob Lew took the European Union to task Wednesday for its decision to ...



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Kimble Charting Solutions

Gold Miners, slipping below steep rising support

Courtesy of Chris Kimble.

Gold miners have had a great run this year. They could be losing grip on key support of late!

Below looks at the Gold & Silver mining index (XAU) over the past decade.

CLICK ON CHART TO ENLARGE

I like to keep an eye on the XAU index because it is the oldest mining index in the states and it includes both Gold & Silver mining stocks. 

T...



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OpTrader

Swing trading portfolio -week of August 29th, 2016

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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Biotech

Epizyme - A Waiting Game

Reminder: Pharmboy is available to chat with Members, comments are found below each post.

Epizyme was founded in 2007, and trying to create drugs to treat patient's cancer by focusing on genetically-linked differences between normal and cancer cells. Cancer areas of focus include leukemia, Non-Hodgkin's lymphoma and breast cancer.  One of the Epizme cofounders, H. Robert Horvitz, won the Nobel Prize in Medicine in 2002 for "discoveries concerning genetic regulation of organ development and programmed cell death."

Before discussing the drug targets of Epizyme, understanding epigenetics is crucial to comprehend the company's goals.  

Genetic components are the DNA sequences that are 'inherited.'  Some of these genes are stronger than others in their expression (e.g., eye color).  Yet, some genes turn on or off due to external factors (environmental), and it is und...



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Digital Currencies

Man Who Introduced Millions to Bitcoin Says Blockchain Is a Bust

 

Man Who Introduced Millions to Bitcoin Says Blockchain Is a Bust 

By  at Bloomberg

Excerpt:

Stefan Thomas, who introduced millions of people to bitcoin, has had a change of heart.

Blockchain, the ledger software that makes the digital currency possible...



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Mapping The Market

Illusion of Choice

From Jean-Luc:

Looks like we are down to about 10 companies for our consumer goods:

http://www.visualcapitalist.com/illusion-of-choice-consumer-brands/

Just like banks, airlines and cable companies! 

The Illusion of Choice in Consumer Brands

Explore the full-size version of the above graphic in all its glory.

If today’s infographic looks familiar, that’s because it originates from a well-circulated report that Oxfam International puts together to show consolidation i...



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All About Trends

Mid-Day Update

Reminder: Harlan is available to chat with Members, comments are found below each post.

Click here for the full report.




To learn more, sign up for David's free newsletter and receive the free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. - Ilene...

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Help One Of Our Own PSW Members

"Hello PSW Members –

This is a non-trading topic, but I wanted to post it during trading hours so as many eyes can see it as possible.  Feel free to contact me directly at jennifersurovy@yahoo.com with any questions.

Last fall there was some discussion on the PSW board regarding setting up a YouCaring donation page for a PSW member, Shadowfax. Since then, we have been looking into ways to help get him additional medical services and to pay down his medical debts.  After following those leads, we are ready to move ahead with the YouCaring site. (Link is posted below.)  Any help you can give will be greatly appreciated; not only to help aid in his medical bill debt, but to also show what a great community this group is.

http://www.youcaring.com/medical-fundraiser/help-get-shadowfax-out-from-the-darkness-of-medical-bills-/126743

Thank you for you time!




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