“The U.S. economy is ready to take off, BlackRock Chairman and CEO Larry Fink said Thursday, citing the health of the banks and the nation's energy resources.” Full story at…
http://www.cnbc.com/id/100534427
WE ARE IN RECESSION – STILL (ECRI)
ECONOMIC CYCLE RESEARCH INSTITUTE)“ECRI is…insisting that the U.S. economy is mired in the middle of a mild recession that began in the middle of 2012... but we just don't know it yet…In support of this position, ECRI Co-Founder and Chief Operations Officer Lakshman Achuthan points out correctly that the timing of recessions is often determined only with the benefit of hindsight…Achuthan thinks that, when the final revisions are in, they will show a recession that began in mid-2012.” Full story at…
http://finance.yahoo.com/blogs/daily-ticker/ecri-still-insists-recession-just-don-t-know-163306844.html
You couldn’t find two more divergent viewpoints on the
economy.
My own analysis simply compares the Morgan Stanley Cyclical Index vs the
S&P 500 to see what investors think about recession. (Cyclicals are recession sensitive so if the
cyclicals were falling relative to the S&P 500 we might be concerned about
recession.) Over the last month, cyclical
stocks are now slightly outperforming the S&P 500 and over the last 10-days,
cyclicals are up over 4%. Investors are
currently betting against recession.
If you think there is disagreement over the economy, just
look at opinions about the stock market.
It seems that pundits are either calling for a great resurgence in
stocks or a correction/crash.
I am on the correction/crash side of the fence. I think a correction is nearly certain; it
may start now or at most after another 5% advance in the S&P 500. If it starts now, I am expecting a 10%
correction that has potential to get worse, but that would depend on the news.
MARKET
RECAP
Thursday, the S&P 500 finished up about 3Pts to 1544 (rounded). VIX fell about 3.5%, to 13.06.
Thursday, the S&P 500 finished up about 3Pts to 1544 (rounded). VIX fell about 3.5%, to 13.06.
The market
internals are turning up, so perhaps the S&P 500 will head higher. That’s hard to say. The S&P 500 tried both yesterday and
today to breach my projected top of 1545, but it didn’t make it. With the internals looking up, I may be
proven wrong that 1545 will be the top.
As noted yesterday, I think S&P 500 might manage to get 5% above
today’s close, but not much farther.
NTSM
Thursday, the NTSM analysis remained HOLD at the close.
MY INVESTED POSITION
I took a hedging, short-position Wednesday afternoon, 27 Feb 13 – I’ll
cover if S&P breaks above 1545.
With longer term funds, I cut back to about 20% invested as I went to
cash in the retirement account on 5 March due to my risk tolerance rather than
the NTSM analysis. To put it bluntly, I
currently have no tolerance for risk.
You may review my reasoning at…
