Archive for March, 2016

• The Rally Turns Seven
  Eddy Elfenbein, March 9th, 2016 at 1:52 pm

  Today is the seventh anniversary of the start of the great bull market. This has been one of the greatest rallies in history. It’s also been one of the most hated rallies in history. I can’t think of a bull run that was often predicted to end and then failed to do so as often. Almost from Day #1 I’ve heard people scream and holler that it’s a phony, fake, Fed-induced rally that’s all about to crash.

  Well…it hasn’t.

  Here’s the S&P 500 Total Return Index since March 9, 2009:

  

• The Defensive Rally
  Eddy Elfenbein, March 9th, 2016 at 1:44 pm

  Here’s a look at the Utility ETF (XLU) and Consumer Staples ETF (XLP).

  

  Looking at the chart, you can see they follow each other somewhat closely. That’s not surprising since both are defensive sectors. Both sectors have rallied to new 52-week highs today.

• Morning News: March 9, 2016
  Eddy Elfenbein, March 9th, 2016 at 7:06 am

  E.U. Ministers Agree to Share Tax Details on Multinationals

  Court Orders Japan Reactor to Shut Down, Keeps 2nd Offline

  Norway Wealth Fund Isn’t Joining Global Stock Selloff, CEO Says

  Wall Street Is in Charge in Argentina (Again)

  Saudi Arabia Seeks $6-8 Billion Bank Loan to Shore Up State Coffers

  Online Lenders Drawing More Scrutiny By Regulators

  Chinese Telecoms Giant ZTE Seeks Solution To US Commerce Department Ban, But ‘Uncertain’ Over Outcome

  Toshiba to Enter Exclusive Talks With Canon on Medical-Unit Sale

  Bristol-Myers Squibb Says Stops Some Initiatives in China

  Companies Go Green on Their Own Steam

  Boeing Gives United A Smoking Deal On 737s To Block Bombardier From Gaining Traction

  Bezos’ Space Company Aims For Passenger Flights in 2018

  The Da Vinci Markup? Europe’s Art Scandal Comes to America

  Josh Brown: Recessions and Stocks: These are the Facts

  Cullen Roche: Are Debt Financed Booms/Busts a “Theory”?

  Be sure to follow me on Twitter.

• Is the S&P 500 Due for a Bounce?
  Eddy Elfenbein, March 8th, 2016 at 3:50 pm

• Morning News: March 8, 2016
  Eddy Elfenbein, March 8th, 2016 at 7:03 am

  China’s Export Slump Shows Growth Push Hinges on Local Demand

  Mark Carney Says U.K.’s EU Settlement Helps BOE Achieve Its Objectives

  Cyprus Confident of Bond Market Access After Bailout Exit

  State of Play

  The Game Has Changed: Partnerships Could Be Subject To Income Tax Under New Partnership Audit Rules

  Iron Ore’s Rally Stalls as Goldman to Citigroup Forecast Retreat

  Vivint Solar Terminates $2.2 Billion Merger With SunEdison

  HSBC Going Solo in China Credit Cards Boosts Expansion Plan

  Germany’s Merck Boosted by Diversification Into Life Sciences

  Alibaba Affiliate Ant Financial Valued at More Than $50 Billion

  Why a SoftBank Separation Is Better for All Parties

  Why $146,200 is a Terrible Bonus for Wall Street

  Jim Wang: How I Built a Dividend Growth Investment Portfolio

  Josh Brown: Just Stop

  Howard Lindzon: Backing and Filling … Start Ups do It Too

  Be sure to follow me on Twitter.

• Robert Benchley: “The Causes Of The Depression”
  Eddy Elfenbein, March 7th, 2016 at 9:42 pm

• Best Blogs of 2016
  Eddy Elfenbein, March 7th, 2016 at 10:15 am

  Thank you to The College Investor which has named us one of the 20 Best Investing Blogs of 2016!

• Seven Years Ago
  Eddy Elfenbein, March 7th, 2016 at 9:12 am

  This time of year has been fairly popular for major stock market turns. In 2000, the Nasdaq reached its nosebleed peak on March 10. Sixteen years later, we’re still below that level.

  On March 11, 2003, the S&P 500 reached its closing low ahead of an impressive rally sparked by the opening of the Iraq War.

  But the most impressive turn came seven years ago when the market reached one of the best buying opportunities in market history.

  On Friday, March 6, 2009, the S&P 500 reached an intra-day low of 666.79. Like last Friday, that was also Jobs Day. That morning, the government reported that the economy had lost an astounding 651,000 jobs in February. The number for January was revised to a loss of 655,000, and December to minus 681,000. The unemployment rate rose to 8.1%, which was a 25-year high. So you can see why everyone was so bummed out.

  That morning, The Wall Street Journal ran a piece from Michael Bostin, “Obama’s Radicalism is Killing the Dow.”

  That day I posted a chart showing that the Dow, adjusted for inflation, was where it was 43 years before.

  

  Then on Monday March 9, 2009, the S&P 500 reached its low close of 676.53, although it never dipped below the intra-day close from the previous Friday. The market hadn’t been this low in over 12 years.

  To give you an idea of how nervous people were, the Volatility Index was near 50, and the TED Spread was over 1%. Yet this was a great time to buy. Or rather, I should say “because of this,” it was a great time to buy.

  On Thursday, March 12, 2009, Bernie Madoff pled guilty to charges around his Ponzi scheme. In Forbes, Nouriel Roubini said the S&P 500 “could fall to 600.”

  This was also the time when comedian Jon Stewart was criticizing CNBC and Jim Cramer. Stewart first mocked CNBC on March 5. That led to some public back-and-forth between him and Cramer. On the evening of March 12, Cramer came on The Daily Show for their famous matchup.

  From its closing low on March 9, 2009, the S&P 500 would triple by November 6, 2014.

• 1,999.99
  Eddy Elfenbein, March 7th, 2016 at 8:51 am

  On Friday, the S&P 500 closed at 1,999.99. If you’re really serious, Howard Silverblatt, the top numbers guy at S&P 500, says the close was specifically 1,999.98722585876.

  Every 0.01 in the index is worth about $88 million. For some context, the companies in the index earn that, on average, roughly every 40 minutes.

  Are “.99” closes common? Apparently they are. I looked at the past 1,000 daily closes for the S&P 500 and the #1 decimal (only going out two places) was .99 with 21 closes. Second place went to .89 with 17 closes.

  Here’s all the data:

  Decimal	Count
  0.99	21
  0.89	19
  0.15	17
  0.20	17
  0.03	15
  0.50	15
  0.78	15
  0.33	14
  0.57	14
  0.85	14
  0.18	13
  0.29	13
  0.48	13
  0.51	13
  0.53	13
  0.69	13
  0.77	13
  0.05	12
  0.28	12
  0.32	12
  0.36	12
  0.37	12
  0.63	12
  0.82	12
  0.94	12
  0.96	12
  0.04	11
  0.11	11
  0.13	11
  0.16	11
  0.26	11
  0.34	11
  0.42	11
  0.44	11
  0.58	11
  0.61	11
  0.66	11
  0.83	11
  0.84	11
  0.08	10
  0.10	10
  0.17	10
  0.24	10
  0.40	10
  0.49	10
  0.56	10
  0.59	10
  0.62	10
  0.68	10
  0.81	10
  0.92	10
  0.98	10
  0.02	9
  0.07	9
  0.12	9
  0.19	9
  0.31	9
  0.39	9
  0.43	9
  0.45	9
  0.52	9
  0.67	9
  0.75	9
  0.76	9
  0.86	9
  0.93	9
  0.97	9
  0.09	8
  0.14	8
  0.25	8
  0.46	8
  0.54	8
  0.60	8
  0.65	8
  0.74	8
  0.80	8
  0.90	8
  0.91	8
  0.95	8
  0.21	7
  0.22	7
  0.23	7
  0.35	7
  0.38	7
  0.41	7
  0.47	7
  0.55	7
  0.71	7
  0.72	7
  0.73	7
  0.79	7
  0.87	7
  0.88	7
  0.00	6
  0.06	6
  0.64	6
  0.70	6
  0.01	5
  0.30	5
  0.27	4

  A few years ago, I looked at Benford’s Law and the Dow Jones.

• Morning News: March 7, 2016
  Eddy Elfenbein, March 7th, 2016 at 7:07 am

  Japan Central Bank to Cut Next Fiscal Year’s Growth, Price Estimates

  German Factory Orders Drop as Global Slowdown Weighs on

  World’s Food-Import Bill Just Shrank $9 Billion to Five-Year Low

  Europe’s Antitrust Enforcer on Google, Apple and the Year Ahead

  U.S. Government Preparing to Crack Down on Chinese Tech Firm

  What the Average American’s Social Security Retirement Check Would Look Like if Cuts Are Made

  The ETF Files

  The Crude Oil Creep

  BASF Is Weighing a Counterbid for Dupont

  Wells Fargo Said to Seek Dealmaking Chief to Succeed Laughlin

  EDF Finance Chief Quits Amid Split Over U.K. Reactor Project

  Tech Companies, New and Old, Clamor to Entice Cloud Computing Experts

  Wall Street Vets Battle BP in Fallout Over Canada Refinery

  Cullen Roche: Three Things I Think I Think – Weekend Edition

  Jeff Miller: What Does the Election Mean for Financial Markets?

  Be sure to follow me on Twitter.