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Monthly Archives: June 2014

EU Inflation ticks up = ECB QE delayed

Initial reports (called flash reports) about June inflation at the consumer price level (CPI) in Europe show a marked bounce. Early reports show an EU average CPI of 1.0% at an annualized pace — a large bounce from May’s 0.6%. Doubtless the weakened euro currency played a significant role here. Alas 1 month does not make a trend. So we’ll see how far this […] Read the rest of this entry »

Q1 2014 GDP: 3rd kick

Wow.  -2.96% annualized real GDP growth -ahem- contraction in Q1. Let’s just call it -3% to keep it simple. This is out of the usual for the BEA. (the usual theme is sandbag the 2nd estimate, exceed that low-balled estimate with the 3rd try, then wait a few years and dramatically lower the GDP growth rate when it won’t scare anyone)  Apparently the BEA […] Read the rest of this entry »

ECB bluff being called

There have been several banking system stress tests in Europe. To refer to them as a whitewash would be an undeserved compliment. The ECB knows this and has committed to a much-improved whitewash –ahem– financial system stress test.  Late last year the ECB began laying the foundation for this when it indicated it would conduct its own financial system stress test and announce the […] Read the rest of this entry »

Newsletter posted

It’s up.  

St Louis Fed Financial Stress Index: Beware

The St. Louis Fed financial stress index is now matching levels only ever seen in pre-crash 2007.   Current stress readings are -1.3. A comatose stress level that low has only ever been seen once: in February 2007.  Yup. Pre-crash 2007.  Early last year (2013) saw a very close -1.2 reading. Stock market crashes do not initiate when fear of a crash is widespread. […] Read the rest of this entry »

Cabbage video 2 posted: share buybacks, insider selling and market peaks

The cabbages discuss record share buybacks in pre-crash 2007 and now…. The video may be found on the videos tab.    

Share Buyback data updated: nearing pre-crash 2007 record

Q1 saw $154.5B in share buybacks. This has only been topped twice — Q2 & Q3 2007 — the peak of the last major bubble. Strip-out share buybacks and there was no earrings growth in Q1 2014 vs Q1 2013. Indeed there has been virtually no earnings growth for the past 2.5 years — when adjusted for share buybacks. If you take a 2-quarter […] Read the rest of this entry »

Post Fed comment

Hmmm. No new Fed candy. None was expected. Futures managed to jam the SPX higher, but on thin volume. Lots of that lately. The U.S. long bond managed to gain as much as the SPX today. Not exactly a resounding risk-on rally / confirmation.   Risk assets look very very  overbought.    

Newsletter posted

It’s up.  

Humor: animated video of cabbages discussing pre-crash insider selling

The first of several animated videos has been uploaded. This one is about insider selling before the 2007 crash started — and how that record was passed this year. The video may be found under the videos tab.   More to come…