Posts Tagged ‘Clarity and Valuation’

‘Overvalued, Check. Overbought, Check. Overbullish, Check….’

‘Overvalued, Check. Overbought, Check. Overbullish, Check….’

Courtesy of Michael Panzner at Financial Armageddon, and John Hussman

German Stock Exchange Opens After Wall Street Crash

I’ve written a fair number of posts highlighting the disconnect between Wall Street and Main Street (far more than I can remember, in fact). But even if you ignore what is happening in the real economy (you know, like Wall Street usually does), share prices are out of whack — with their own history. In "Clarity and Valuation," John P. Hussman, President of Hussman Investment Trust, discusses that very issue in this week’s edition of Hussman Funds’ Weekly Market Comment:

Last week, the dividend yield on the S&P 500 dropped below 2%, versus a historical average closer to double that level. While part of the reason for the paucity of yield in the current market can be explained by the 20% plunge in dividend payouts over the past year, as financial companies have cut or halted dividends to conserve cash, the fact is that current payouts are not at all out of line with their historical relationship to revenues, and even a full recovery of the past year’s dividend cuts would still leave the yield at a paltry 2.5%. The October 1987 crash occurred from a yield of 2.65%, which was, at the time, the lowest yield observed in history, matched only by the 1972 peak prior to the brutal 1973-74 bear market.

Those two periods had a few other things in common. In the weeks immediately preceding the market downturn, stocks were overbought, had advanced significantly over prior weeks, bond yields were creeping higher, and investment advisory bearishness had dropped below 19%. All of those features should be familiar, because we observed them at the 1987 and 1972 peaks, and we observe them now.

On the basis of normalized profit margins, the average price/earnings ratio for the S&P 500, prior to 1995, was only about 13. Higher historical “norms” reflect the addition into that average of extremely high “recession P/Es,” based on dividing the S&P 500 by extremely low, but temporarily depressed earnings. For example, the P/E for the S&P 500 currently is 86, because earnings have been devastated, but it would be foolish to take that figure at face value, and equally foolish to work it into a historical “average” P/E. The pre-1995 norm


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ValueWalk

Be a Bird Dog to Become Wealthy in Real Estate Business

By Professor M.S. Rao, Ph.D.. Originally published at ValueWalk.

“The womb from which you emerge determines your fate to an enormous degree for most of the seven billion people in the world.” – Warren Buffett

[reit]

Q2 2020 hedge fund letters, conferences and more

Investing in land is one of the wisest investments in the world. You can strike it rich if you can identify the potential areas and invest in them at the right time.  If you acquire knowledge about the real estate, research the promising areas, and act at an appropriate time, you can becom...



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Kimble Charting Solutions

Silver Could Be Creating Large Reversal Pattern, Says Joe Friday

Courtesy of Chris Kimble

Could Silver prices from 30-years ago be influencing price action this month? Joe Friday suggests it is possible.

This chart looks at Silver Futures on a monthly basis over the past 40-years. Fibonacci levels were applied to the 1980 highs ($50) and 1991 lows ($.350) in Silver.

The 50% retracement levels of the 1980 high/1991 low came into play as support for a few months at each (1). Once this support broke, Silver fell another 50%.

The impressive rally over the past 8-weeks has Silver testing the 50% retracement level as potential...



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Phil's Favorites

Movie theaters are on life support - how will the film industry adapt?

 

Movie theaters are on life support – how will the film industry adapt?

A movie theater in Brea, Calif., has shuttered its doors due to the coronavirus pandemic. AP Photo/Jae C. Hong

Courtesy of Matthew Jordan, Pennsylvania State University

Since the start of the pandemic, the film industry has been in free fall.

As deaths have continued to climb, ...



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Biotech/COVID-19

Wearable fitness devices deliver early warning of possible COVID-19 infection

 

Wearable fitness devices deliver early warning of possible COVID-19 infection

Fitness information from wearable devices can reveal when the body is fighting an infection. Nico De Pasquale Photography/Stone via Getty Images

Courtesy of Albert H. Titus, University at Buffalo, The State University of New York

The difficulty many people have getting tested for SARS-CoV-2 and delays in receiving test results make early warning of possible COVID-19 infections all the more important, and ...



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Zero Hedge

Fake ID Seizures, Mostly From China, On the Rise

Courtesy of ZeroHedge View original post here.

Authored by Petr Svab via the Epoch Times (emphasis ours),

U.S. Customs and Border Protection (CBP) has been seizing an increasing number of fake IDs, including driver’s licenses, in recent years. Most come from China and are good enough to fool an average person, an agency official said.

...

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The Technical Traders

Adaptive Fibonacci Price Modeling System Suggests Market Peak May Be Near

Courtesy of Technical Traders

Our Adaptive Fibonacci Price Modeling system is suggesting a moderate price peak may be already setting up in the NASDAQ while the Dow Jones, S&P500, and Transportation Index continue to rally beyond the projected Fibonacci Price Expansion Levels.  This indicates that capital may be shifting away from the already lofty Technology sector and into Basic Materials, Financials, Energy, Consumer Staples, Utilities, as well as other sectors.

This type of a structural market shift indicates a move away from speculation and towards Blue Chip returns. It suggests traders and investors are expecting the US consumer to come back strong (or at least hold up the market at...



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Chart School

Silver Big Channel

Courtesy of Read the Ticker

Big channels are the sand pit of price action. Lets review some big trends of these past months.


GLD
- Moving higher to upper solid red line channel


Click for popup. Clear your browser cache if image is not showing.






XAU
- Ready to pause, or simply explode.



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SILVER
- Ready to pause, or simply explode.


Click for popup. Clear your browser cache if image i...



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Digital Currencies

Raoul Pal: "It May Not Be Worth Owning Any Asset Other Than Bitcoin"

Courtesy of ZeroHedge View original post here.

Authored by Turner Wright via CoinTelegraph.com,

Raoul Pal, CEO and founder of Real Vision, says Bitcoin may soon become his only asset for long-term investments.

image courtesy of CoinTelegraph ...



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Lee's Free Thinking

Texas, Florida, Arizona, Georgia - The Branch COVIDIANS Are Still Burning Down the House

 

Texas, Florida, Arizona, Georgia – The Branch COVIDIANS Are Still Burning Down the House

Courtesy of Lee Adler, WallStreetExaminer 

The numbers of new cases in some of the hardest hit COVID19 states have started to plateau, or even decline, over the past few days. A few pundits have noted it and concluded that it was a hopeful sign. 

Is it real or is something else going on? Like a restriction in the numbers of tests, or simply the inability to test enough, or are some people simply giving up on getting tested? Because as we all know from our dear leader, the less testing, the less...



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Members' Corner

Coronavirus, 'Plandemic' and the seven traits of conspiratorial thinking

 

Coronavirus, 'Plandemic' and the seven traits of conspiratorial thinking

No matter the details of the plot, conspiracy theories follow common patterns of thought. Ranta Images/iStock/Getty Images Plus

Courtesy of John Cook, George Mason University; Sander van der Linden, University of Cambridge; Stephan Lewandowsky...



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Insider Scoop

Economic Data Scheduled For Friday

Courtesy of Benzinga

  • Data on nonfarm payrolls and unemployment rate for March will be released at 8:30 a.m. ET.
  • US Services Purchasing Managers' Index for March is scheduled for release at 9:45 a.m. ET.
  • The ISM's non-manufacturing index for March will be released at 10:00 a.m. ET.
  • The Baker Hughes North American rig count report for the latest week is scheduled for release at 1:00 p.m. ET.
...

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Promotions

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Mapping The Market

How IPOs Are Priced

Via Jean Luc 

Funny but probably true:

...

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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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