Financial Markets and Economy
Dollar turns lower as traders brush off jobs data (Market Watch)
The dollar turned lower in midafternoon trade Friday as investors decided that the March jobs report, while better-than-expected on its surface, likely wouldn’t change the Federal Reserve’s plan for raising interest rates.
7 tax strategies the rich don't want you to know (Business Insider)
You work hard for your money but, unfortunately, Uncle Sam takes a bite out of every paycheck for income and other taxes. And if you’re in the middle class, you probably think that bite is a little bit too big.
The world is near a 'major turning point' in the currency wars (Business Insider)
Currency wars are like real wars in more ways than one. They can last longer than the combatants expect, and produce unexpected victories and losses. Real wars do not involve all fighting, all the time. There are quiet periods, punctuated by major battles, followed by new quiet periods as the armies rest and regroup.
What are the chances of a recession? Not what you’d think (Washington Post)
For at least five years, we have been hearing that the United States is on the verge of slipping into a recession.
Of course, it hasn’t — and probably won’t anytime soon. I’d like to talk about why that is and in the process look at how economic expansions end.
This Indicator Suggests A Bear Market Is Now Underway And It’s Likely To Be A Painful One (The Felder Report)
NYSE margin debt fell again during the month of February. After the selloff in stocks that kicked off 2016, this should come as no surprise. Investors are usually forced to reduce leveraged bets during these sorts of episodes in the stock market. In fact, this forced selling can actually exacerbate the volatility. And because margin debt is only now beginning to come down from record highs, surpassing those seen at the 2000 and 2007 peak, this should be of concern to most equity investors.
Should Investors Worry About Earnings Season (Forbes)
The very volatile 1st quarter ended on Thursday and the results confounded the majority of fundamental and technical analysts. Those that were right about the strong performance of gold were likely way off the mark as to where markets closed the quarter.
A closely followed indicator says a 20% drop in stocks could be coming soon (Business Insider)
NYSE margin debt fell again during the month of February. After the selloff in stocks that kicked off 2016, this should come as no surprise. Investors are usually forced to reduce leveraged bets during these sorts of episodes in the stock market. In fact, this forced selling can actually exacerbate the volatility. And because margin debt is only now beginning to come down from record highs, surpassing those seen at the 2000 and 2007 peak, this should be of concern to most equity investors.
Wall Street to end 2016 with small gain; rate rises a worry: Reuters poll (Reuters)
The turbulent selloff that marked the start of the year for U.S. stocks may be over, but the market will still end 2016 with a whimper, posting just a modest gain, according to strategists polled by Reuters.
Market Even More Overbought (Stock Charts)
The preliminary S&P 500 Index 2015 fourth quarter earnings results are in, and it is once again time to look at our earnings chart, which shows the S&P 500 in relation to its normal value range.
Digging Further Into the Recent Weakness in European Stocks (Fortune Financial)
Ben Carlson of A Wealth of Common Sense recently took a look at the outperformance of US equities vs European equities since the financial crisis. I found his analysis intriguing as it touches on the key question of whether or not European equities, – currently by some measures extremely discounted relative to the US on a valuation basis, – will play catch up with their American counterparts.
Fed's Mester doesn't want to wait too long on rate hike (Reuters)
The Federal Reserve should still raise interest rates gradually this year given the economy's resilience, a top Fed official said on Friday, explaining she did not want to wait too long despite having supported last month's decision to stand pat.
The Double Edged Sword of Trend Following ETFs (Fmd Capital)
I’ve always been a big proponent of following the major trends in the market to serve as guideposts for sizing the stock allocation of my portfolio. Trend lines like the infamous 200-day moving average have never been a perfect predictor of stock market direction. However, using these types of technical indicators can serve as a useful tool for making incremental adjustments over time.
The Narrative Changes: Goldman "Explains" That Higher Oil Prices Are Actually Better For The Economy (Zero Hedge)
Back in late 2014 and early 2015, this website soundly mocked any and every economist that suggested that plunging oil prices – in a globalized economy where oil has been financialized beyond recognition and impacts every asset class, the stock market, global trade flows, and international diplomacy – is "unambiguously good."
Bulls Vs Bears – Who Will WIn (Real Investment Advice)
As March marked the beginning of spring, the bulls were stampeded by a “perfect storm” of Central Bank actions. From the ECB dropping rates into negative territory and launching a bigger “quantitative easing” program, to the Federal Reserve backing off its plans to hike interest rates this year, the “accommodative support” gave the bulls the clearance they needed to pile back into equities.
Stock Buybacks Look Like A Non-Story To Us (Gavekal Capital)
Much has been made about the stock buyback “craze” over the past several years. There is a common argument that says companies have been massively levering up in order to buyback their own stock which in turn boosts EPS at the detriment of investing in the future or returning money to shareholders via dividends. However, when we look at the aggregate data for US companies ex-financials we don’t believe that this argument holds up under scrutiny.
It’s Time for Investors to Re-Learn the Lost Art of Reading (Wall Street Journal)
Fund manager Geoffrey Abbott is extremely committed. Or maybe he needs to becommitted.
Every day for the past seven weeks, Mr. Abbott has read an average of 39 letters that CEOs write to shareholders in their companies’ annual reports. His goal is to peruse the annual report from each of the 3,000 largest companies in the U.S.
Remembrances of Depression Economics (NY Times)
A bit more musing inspired by Brad DeLong’s decision to repost his old, rather negative review of my 1999 “The Return of Depression Economics” — which I think he means to imply was a review that got it mostly wrong, while I got it much more right than he realized at the time.
The state of California is suing Morgan Stanley over crisis-era investments (Business Insider)
The state of California is suing investment bank Morgan Stanley over losses during the financial crisis.
No One On Wall Street Is Making This Call (Joe Fahmy)
For the past month, I’ve been telling people that the market is going much higher and they all look at me like I have 3 heads and I’m speaking a foreign language.
Politics
Donald Trump will win in a landslide. *The mind behind ‘Dilbert’ explains why (Washington Post)
Scott Adams remembers just how the game turned. He was young and improving at chess, but the masterful kid across the board would outmaneuver Adams till the game seemed a runaway. Now, this kid didn’t want to just beat Adams; he wanted to embarrass him. “So after he’d picked away three-fourths of my pieces and I was discouraged,” Adams recounts, “he would offer to turn the board around and play with my pieces.” And then effectively “win” again.
The Republican party’s biggest problem isn’t Trump—it’s the Obama economy (Quartz)
Today’s strong jobs report is another reminder that even if Donald Trump wasn’t exposing the fractures in its electoral coalition, the Republican party would still face a daunting challenge in November.
The Republicans’ Gay Freakout (NY Times)
Our infrastructure is inexcusable, much of our public education is miserable and one of our leading presidential candidates is a know-nothing, say-anything egomaniac who yanks harder every day at the tattered fabric of civil discourse and fundamental decency in this country.
Technology
Japanese Robotic Farm’s First Harvest Next Year—Half a Million Lettuces a Day in Five Years (Singularity Hub)
In modern times, farming's gone from humanity's top job to a sliver of the economy—a trend that continues today as fewer young people choose to farm. For every farmer under 35 there are 6 over 65, and a quarter of today's US farmers will retire by 2030. But we all still have to eat.
A recent Yes! Magazine article wonders: "If there are no new farmers, who will grow our food?"
The Tesla Model 3 will have futuristic 'spaceship' steering controls, says Elon Musk (The Verge)
The steering wheel setup in the Tesla Model 3 — seen above in a shot from the media event last week — is not the version that will be in the final car, Tesla CEO Elon Musk said tonight in a series of tweets.
Instead, the "real steering controls and system" for the Model 3 feel "like a spaceship."Musk went on to say that the lack of a traditional dashboard and instrument cluster "will make sense after part 2" of the Model 3 unveiling. That's expected to come much closer to production.
Health and Life Sciences
Antimatter changed physics, and the discovery of antimemories could revolutionise neuroscience (Scroll In)
One of the most intriguing physics discoveries of the last century was the existence of antimatter, material that exists as the “mirror image” of subatomic particles of matter, such as electrons, protons and quarks, but with the opposite charge. Antimatter deepened our understanding of our universe and the laws of physics, and now the same idea is being proposed to explain something equally mysterious: memory.
Life on the Home Planet
A record number of people in Japan are dying from overwork (Business Insider)
Japan is witnessing a record number of compensation claims related to death from overwork, or "karoshi", a phenomenon previously associated with the long-suffering "salary man" that is increasingly afflicting young and female employees.
