Recently Federal Reserve Chairman Jerome Powell suggested that the Federal Funds rate, or overnight bank lending rate, will return to the Effective Lower Bound (ELB). In central banker speak, the ELB is zero percent. Powell indicated the return to the ELB is not an if event, but only a matter of when. This has spurred … Read more
U.S. investors are buying stocks and selling bonds ahead of the trade meeting between President’s Trump and Xi ahead of the G-20 summit in Osaka Japan this weekend on hopes a resolution is made. China doesn’t appear to have such plans, as they have stated this meeting will be used to clarify their demands for … Read more
In overnight trading, China is insisting that the U.S. remove the ban on the sale of U.S. technology to Huawei, remove all tariffs and remove demands for China to buy more U.S. exports ahead of President Trump and Xi’s meeting before the G-20 meeting in Osaka Japan on Saturday. Kudlow confirmed this morning that the … Read more
The Dow Jones Industrial Average has made a quadruple top at approximately 26,630 over the past two years, which is extremely rare. From a technical perspective, a security only needs two tops to bring in sellers, with three being rare. A quadruple top on a major market index is unheard of. It is a clear … Read more
Stocks started the day lower as the Conference Board’s Consumer Confidence survey fell to its two-year lows. Consumers were less optimistic about the job market and business conditions. The gap between consumer confidence and savings is looking just like it did prior to the last two recessions when consumers were overly confident about the economy. … Read more
U.S. equity futures started the week higher in overnight trading, even though the global manufacturing sector is about to contract, and commercial lending has started to contract. Both have led to lower stock prices and recessions in the past. Investors continue to brush off any bad news and bid stocks higher, proving that little has … Read more
What makes the “Smart Money” so smart is not their ability to be on the right side of the market when it matters, but how they do it without anyone taking notice until it is too late. While retail investors are hyper-focused on stocks, which are roughly at the same price level they were eighteen … Read more
Stocks started the day higher on quadruple-witching day, the day when options and futures contracts expire, and as the corporate share buyback blackout begins for second-quarter earnings season. Investors were relieved that the Trump Administration will not be retaliating against Iran with military force at this time and that Vice President Pence indicated that trade … Read more
In a masterful move, yesterday the Fed lowered interest rates without lowering interest rates. Investors have been pumping social media, forums, and newsletters with comments about how stock prices are headed significantly higher, how bond prices are headed significantly lower, and how crude oil prices are headed higher. Given the weak trading volumes the week … Read more
Stocks are quiet ahead of today’s FOMC press release while Treasury yields ticked slightly higher as short sellers came late yesterday to defend falling Treasury yields. The EIA reported crude oil inventories as Crude: -3.106mm (-1.75mm expected), Cushing: +642k (+30k expected), Gasoline: -1.692mm (+900k expected), and Distillates: -551k (+700k expected). Crude prices rose following the … Read more