Posts Tagged ‘leading indicator’

RADAR LOGIC: CA, A LEADING INDICATOR OF REAL ESTATE IS HEADED DOWN ALREADY

RADAR LOGIC: CA, A LEADING INDICATOR OF REAL ESTATE IS HEADED DOWN ALREADY

Courtesy of The Pragmatic Capitalist 

Excellent commentary here from Michael Feder, chief executive officer of Radar Logic Inc. Feder says some very negative trends in housing are developing – the most worrisome of which is the deterioration in CA prices, which, according to Feder, is a leading indicator for the rest of the country: 


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CHINA: THE LEADING INDICATOR OF LEADING INDICATORS

CHINA: THE LEADING INDICATOR OF LEADING INDICATORS

Shanghai Jade Buddha Temple November 2006 Photo: Roger Parker

Courtesy of The Pragmatic Capitalist 

We’ve often referred to China as a leading indicator of equities over the last few years.  Some sell side analysts have caught onto the trend as well (which likely means it will stop working now).  CitiGroup highlights China’s emergence as the “leading indicator of leading indicators” (via FT Alphaville):

“China is the biggest emerging market in the world, currently accounting for 18.6% of the MSCI GEMs index. We have noticed how, since the end of the last bull market in 2007, the Chinese market has often seemed to reach an inflexion point before other leading global market indices. As equity markets should act as a leading indicator of broader economic growth trends, it seems, therefore, that the Chinese equity market has recently become ‘the leading indicator of the leading indicators’. Given that the local Shanghai Composite index and MSCI China have both rebounded by 13-15% from their recent lows and our China strategist, Minggao Shen, has just turned more bullish on the market1, these events are a positive mix for global emerging markets as a whole. This is, therefore, a good time to consider the Chinese market’s role as a signaling mechanism for GEMs as a whole.”

china CHINA: THE LEADING INDICATOR OF LEADING INDICATORS


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Is the Stock Market a Leading Indicator?

Is the Stock Market a Leading Indicator?

Courtesy of Mish 

Inquiring minds are pondering the question "Is the Stock Market a Leading Indicator?"

Please consider the following two charts.

S&P Monthly Chart 1980-1992

$SPX

click on chart for sharper image

Vertical bars on the chart show when recessions began. There were three recession isn this period, starting January 1980, July 1981, and July 1990 according to NBER Business Cycle Expansion and Contraction Data. The NBER is the official determinant of recessions.

Looking at a chart of the S&P it is difficult to suggest the Stock Market is a leading indicator, coincident perhaps but certainly not leading.

Moreover, the biggest decline during the period was a 35.9% drop in 1987, a period in which there was no recession. Furthermore, I circled four areas with very similar patterns in the 1980-1992 timeframe that were recessions following essentially sideways corrections in the S&P 500. Two of them were recessions, two were not.

For the 1981 recession and the 1990 recession, one could only tell there was a recession coming in hindsight. Finally the January 1980 recession vs. the S&P 500 looks like noise. The stock market actually rose at the start of the recession.

S&P Monthly Chart 1998-2009

click on chart for sharper image

There were two recessions in the 1998 – 2009 timeframe. The clearest case that the stock market is leading came in the recession that began in March 2001. However, the recession ended in November 2001 yet the stock market made a substantial new low mid-2002 with a double bottom test in Spring of 2003.

The stock market declined 34% after the recession was over. Is that a leading indicator? Of what?

For the recession that began in December 2007, the S&P 500 was down only a few percent from its all time high. Is that a leading indicator?

Clearly the answer is no. The S&P 500 was a coincident indicator for the entire recession. The NBER has not yet declared the end of the recession but it will do so and it will be backdated, most likely to Spring of 2009.

If so, the market will have proven to have been a coincident indicator, known only in hindsight.

Conclusion

The stock market is at best a coincident indicator, known only well after the fact. Furthermore, even as a coincident indicator, the


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Zero Hedge

Sweden And Its Welfare State In Crisis

Courtesy of ZeroHedge View original post here.

Authored by Nima Gholam Ali Pour via The Gatestone Institute,

The Swedish welfare state has often been praised by the left in the United States. After the migration crisis of 2015, however, when Sweden was flooded by Syrian refugee claimants, Sweden is now facing a welfare crisis that threatens the entire Swedish welfare state model.

...



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Phil's Favorites

Silicon Valley's latest fad is dopamine fasting - and that may not be as crazy as it sounds

 

Silicon Valley's latest fad is dopamine fasting – and that may not be as crazy as it sounds

Dopamine fasting, the newest fad to hit Silicon Valley, is being used as a way to get over addictive habits. SewCream/Shutterstock.com

Courtesy of A. Trevor Sutton, Concordia Seminary

Silicon Valley’s newest fad is dopamine fasting, or temporarily abstaining from...



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The Technical Traders

The Wuhan Wipeout - Could It Happen?

Courtesy of Technical Traders

News is traveling fast about the Corona Virus that originated in Wuhan, China. Two new confirmed cases in the US, one in Europe and hundreds in China. As we learn more about thispotential pandemic outbreak, we are learning that China did very little to contain this problem from the start. Now, quarantining two cities and trying to control the potential
outbreak, may become a futile effort.

In most of Asia, the Chinese New Year is already in full swing.  Hong Kong, China, Singapore, Malaysia, India and a host of other countries are already starting to celebrate the 7 to 10 day long New Year.  Millions of people have already traveled hundreds of thousands of miles to visit family...



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Kimble Charting Solutions

Bad News For Crude Oil Should Come From This Pattern, Says Joe Friday

Courtesy of Chris Kimble

It’s a good idea for investors to be aware of key indicators and inter-market relationships.

Perhaps it’s watching the US Dollar as an indicator for precious metals or emerging markets. Or watching interest rates for the economy. Experience, history, and relationships matter. And it’s good to simply add these to our tool-kit.

Today, we look at another relationship that has signaled numerous stock market tops and bottoms over the years, and especially the past several months, Crude Oil.

When crude oil tops or bottoms, it seems that ...



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Insider Scoop

5 Software-Application Stocks Moving In Thursday's After-Market Session

Courtesy of Benzinga

Gainers

Atlassian Corporation, Inc. (NASDAQ:TEAM) stock surged 9.7% to $145.50 during Thursday's after-market session. According to the most recent rating by Morgan Stanley, on January 13, the current rating is at Overweight.

Diebold Nixdorf, Inc. (NYSE:DBD) shares increased by 8.1% to $11.48. The most recent rating by DA Davidson, on December 13, is at Buy, with a price target of $17.00.

Telaria, Inc. (NYSE:TLRA) stock rose 4...



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Biotech

Snakes could be the original source of the new coronavirus outbreak in China

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

 

Snakes could be the original source of the new coronavirus outbreak in China

Chinese cobra (Naja atra) with hood spread. Briston/Wikimedia, CC BY-SA

Haitao Guo, University of Pittsburgh; Guangxiang “George” Luo, Univers...



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Chart School

RTT browsing latest..

Courtesy of Read the Ticker

Please review a collection of WWW browsing results. The information here is delayed by a few months, members get the most recent content.



Date Found: Monday, 16 September 2019, 05:22:48 PM

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


Comment: This chart says SP500 should go back to 2016 levels (overshoot will occur of course)



Date Found: Tuesday, 17 September 2019, 01:53:30 AM

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Comment: This would be HUGE...got gold!


...

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Members' Corner

The War on All Fact People

 

David Brin shares an excerpt from his new book on the relentless war against democracy and how we can fight back. You can also read the first, second and final chapters of Polemical Judo at David's blog Contrary Brin.

The War on All Fact People 

Excerpted from David Brin's new book, the beginning of chapter 5, Polemical Judo: Memes...



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Lee's Free Thinking

Why Blaming the Repo Market is Like Blaming the Australian Bush Fires

 

Why Blaming the Repo Market is Like Blaming the Australian Bush Fires

Courtesy of  

The repo market problem isn’t the problem. It’s a sideshow, a diversion, and a joke. It’s a symptom of the problem.

Today, I got a note from Liquidity Trader subscriber David, a professional investor, and it got me to thinking. Here’s what David wrote:

Lee,

The ‘experts’ I hear from keep saying that once 300B more in reserves have ...



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Digital Currencies

Cryptos Have Surged Since Soleimani Death, Bitcoin Tops $8,000

Courtesy of ZeroHedge View original post here.

Bitcoin is up over 15% since the assassination of Iran General Soleimani...

Source: Bloomberg

...topping $8,000 for the first time since before Thanksgiving...

Source: Bloomberg

Testing its key 100-day moving-average for the first time since October...

...



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Mapping The Market

How IPOs Are Priced

Via Jean Luc 

Funny but probably true:

...

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Promotions

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In My Top Strategies for 2017, Phil's chapter is Secret Santa’s Inflation Hedges for 2017.

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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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