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With the S&P 500 at its highest level since the summer of 2008, investors previously sidelined by reoccurring fears of a double dip recession and nagging worries about a disorderly Greek default may now be tempted to hold their noses and dive into the market where, presumably, they will be swept along to the land of outsized profits by the Dow 13,000 wave. Having said this, it is worth noting that often the best time to sell is when everyone else is buying. Now may be that time. [Let me explain.] Words: 885
February 21st, 2012 | Posted in 2011-12 Forecasts,Economy,Investing,Stock Indices | Read More »
The U.S. Dollar Index is signaling that this rally might have a bit more room to run. [Let me explain.] Words: 400
February 16th, 2012 | Posted in Investing,Stock Indices | Read More »
When it comes to valuing stocks, the price-to-earnings (P/E) ratio is the number one metric for investors that want an instant fix on what the market thinks of a company. [That being said]…there are health warnings to heed if you don’t want to be left exposed by its limitations. [Let me explain.] Words: 1101
February 9th, 2012 | Posted in Investing,Stock Indices | Read More »
The Web is crawling with technical analysis (TA)…[and,] given its popularity, [begs the questions as to whether or not there] really is something to it. [Based on our research,] the short answer is no, not really, at least not in developed markets like the US or the UK… Furthermore, most of the popular TA indicators that are bandied around are nonsense jargon and should be ignored as useless noise. [Let us explain our position.] Words: 2143
February 2nd, 2012 | Posted in Investing,Stock Indices | Read More »
What hope can there be for motivated stock pickers – no matter how much they sweat and toil – to outperform the low-cost index funds that simply mechanically track the market? Well – in spite of the absurd rise of the Nobel-acclaimed, and highly promoted, Efficient Market Hypothesis that claims that individual investors can’t beat the market – it turns out there is plenty! Just ask Warren Buffett, for one. [Let me explain.] Words: 1574
February 2nd, 2012 | Posted in Investing,Stock Indices | Read More »
At the end of November 2011 the U.S. behavioral indicator for the U.S. stock market, based on insights on investor psychology, touched the crisis threshold for the fifth time (1971,1979, 1986, 2006) since 1970. If the current case follows the four prior cases, we expect a similar positive return from November 2011 to the end of October 2012 as in the four prior periods followed by a decline somewhere between 15% and 30%. [Let me explain.] Words: 317
January 29th, 2012 | Posted in Investing,Stock Indices | Read More »
U.S. stocks are trading at their cheapest levels since at least 1990, according to such commonly used valuations as price-to-earnings and price-to-book ratios as well as dividend yield…but [we ask,] cheaper than what? Different “investments” are valued differently at different times during the artificial central-banking business cycle that we must function under. In this case, we would argue, stocks are more likely reflecting potential chaos to come than a buying opportunity. Sure, there may be rallies during this fiat bear market but they should be considered within the context of the larger trends.
January 16th, 2012 | Posted in Investing,Stock Indices | Read More »
Initial unemployment claims may be the most important economic indicator for the stock market in 2012. It is one of the three components of our Fundamental Stock Market Indicator (FSMI), which is highly correlated with the S&P 500, [see graph below] so if initial unemployment claims remain under 400,000 and possibly continue to head lower during January, that would support the strong stock market rally that has kicked off the New Year so far. Words: 395
January 8th, 2012 | Posted in Investing,Stock Indices | Read More »
[While] I do not prescribe to the 2012 end of the world or end of an era phenomenon, my recent fractal (pattern) analysis of the Dow suggests that it is forming a similar pattern to that which was formed in the late 60s to early 70s and if this pattern continues in a similar manner…the Dow could indeed have an annus horribilis (horrible year) in 2012. Let me explain. Words: 1416
January 6th, 2012 | Posted in Investing,Stock Indices | Read More »
This post initiates what I hope will become a multi-year tradition of listing what, according to munKNEE.com readers, were the most read articles in 2011 on how best to invest in the stock market from a broad, and therefore timeless, perspective. Introductory paragraphs and links to each article are provided in descending order of popularity. Enjoy!
January 1st, 2012 | Posted in Investing,Stock Indices | Read More »
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