Reminiscent of the dot com bubble days, the percentage of IPOs that are currently unprofitable is at its highest level since 2007. During good times, this gets ignored, but if the market/economy weakens, flight to safety rotates money out of these stocks.
High Margin Debt (7/12)
Margin debt is dollar value of stocks held above and beyond the value of a portfolio. So if a $100K portfolio has $110K of stock, it’s said the investor is $10K on margin.
High Car Inventories (8/12)
The US has a consumption-based economy – it desperately depends on people buying stuff. When inventories build, either companies are way too optimistic predicting demand or demand is weaker than it normally is.
Deflationary Pressures (9/12)
Nobody likes runaway inflation, but its equal-and-opposite cousin, deflation, is pretty bad too – just ask those who lived through the Depression.
Junk Bonds are Weak (10/12)
Junk bonds are bonds issued by companies that have low credit ratings. There is less confidence the company will make their payments, so they have to offer them at a higher rate.
Strong Dollar (11/12)
Going back to the middle of 2014, the dollar has been very strong.
Strong Bonds (12/12)
Money often rotates between the stock market and bond market – the safety of bonds vs. the risk and upside potential of stocks.
Before the Open (Jan 7)
Good morning. Happy Thursday. The Asian/Pacific markets closed with big, across-the-board losses. China dropped 7% and then was halted the rest of the day. Hong Kong fell more than 3%; Japan, Singapore, Australia and India dropped more than 2%; Indonesia, South Korea and Taiwan dropped more than 1%. Europe is currently suffering huge losses. Greece […]
Before the Open (Jan 6)
Good morning. Happy Wednesday. The Asian/Pacific markets closed mostly down. China rallied better than 2%, and Indonesia did better than 1%. Japan, Hong Kong, Singapore, Australia and Taiwan fell more than 1%. Europe is currently pretty much down across-the-board. The Netherlands and Italy are down more than 2%; London, Germany, France, Norway, Switzerland, Denmark, Spain, […]
Before the Open (Jan 5)
Good morning. Happy Tuesday. The Asian/Pacific markets closed with a lean to the downside. Australia dropped 1.6%; Hong Kong, New Zealand and Taiwan were also weak. Indonesia, Malaysia and South Korea did well. Europe currently leans to the downside. Norway, Greece and Portugal are down more than 1%; Sweden, Poland, Turkey and Switzerland are also […]