dshort

Charting economic and market trends

Equity Valuations, Recessions and Stock Market Declines

Equity Valuations, Recessions and Stock Market Declines Thumbnail Chart

Note: In response to an email, I've updated the data in this article through the March month-end numbers and at the launch of the Q1 2016 earnings season.

Last year I had a fascinating conversation with Neile Wolfe, of
Wells Fargo Advisors, LLC. Based on the underlying data in the adjacent chart, Neile made some cogent observations about the historical relationships between equity valuations, recessions and market prices:

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Accentuate the Positive: The Psychological Inflation of Quarterly GDP

Accentuate the Positive: The Psychological Inflation of Quarterly GDP Thumbnail Chart

Note from dshort: I've updated the last chart in this commentary to include today's Q4 GDP Advance Estimate of real quarterly GDP. The BEA's annualized growth rate of 2.6% (2.64% to two decimals) is based on a 0.65% quarter-over quarter percentage change.

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The S&P 500 and Recessions

The S&P 500 and Recessions Thumbnail Chart

Note from dshort: Yesterday Political Calculations posted a fascinating article entitled Dividends: A Resurgence of Recessionary Conditions, which studies the correlation between recessions and the number of companies per month announcing dividend cuts. The article prompted me to update my long-term look at the S&P 500 and recessions.

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IMF Cuts Global Growth Forecast

IMF Cuts Global Growth Forecast Thumbnail Chart

Most weekends I post an update on world market performance with a focus on eight major world indexes denominated in their own currency. This morning my friend and master market technician Chris Kimble called attention to the IMF's report posted on their website: Global Growth Disappoints, Pace of Recovery Uneven and Country-Specific:

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New Updates at Crestmont Research

New Updates at Crestmont Research Thumbnail Chart

Note from dshort: My friend Ed Easterling, whose Crestmont Research P/E valuation is a regular feature on this website, has published collection of periodic updates to his ongoing analysis. The commentary below is based on his latest distribution email to subscribers.

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Median Household Incomes after the Great Recession: Household Types and Educational Attainment

Median Household Incomes after the Great Recession: Household Types and Educational Attainment Thumbnail Chart

Yesterday I posted my analysis of selected features in Sentier Research's new report on the general decline in median household incomes since the end of the Great Recession in June 2009. My focus was on real income change by age groups and by racial/ethnic categories (more here). Today I'll examine the real income changes by household type and educational attainment.

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Is This Bull Market Fundamentally Driven? A Look at PE Expansion

Is This Bull Market Fundamentally Driven? A Look at PE Expansion Thumbnail Chart

Earlier today the anonymous author of Wall Street Rant sent me a link to a commentary that asks the intriguing question Is This Bull Market Fundamentally Driven?

The approach used in the commentary to answer the question is to do some simple math with the Cyclically Adjusted P/E (CAPE) popularized by Yale Professor Robert Shiller.

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Chicago Fed National Activity Index Revisions

Chicago Fed National Activity Index Revisions Thumbnail Chart

In my CFNAI update yesterday I repeated my warning that "it's unwise to read very much into the data for any specific month. Also data revisions frequently make the real-time headline subsequently inaccurate. The 3-month moving average is a better number to watch."

The two latest reports offer a classic illustration of the point.

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Pulse of Commerce Index: May Gain of 0.8% In a Now Discontinued Index

Pulse of Commerce Index: May Gain of 0.8% In a Now Discontinued Index Thumbnail Chart

The latest Ceridian-UCLA Pulse of Commerce Index (PCI), a measure of the economy based on diesel fuel consumption, is now available.

Each month I've looked forward to the publication of the Pulse of Commerce Index. I'm sad to report that today's report was posted with the accompanying message: "Please note that the May 2012 Ceridian-UCLA Pulse of Commerce Index by UCLA Anderson School of Management will be the last report issued."

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Spain, Italy, Greece and the Forthcoming EU Summit

Spain, Italy, Greece and the Forthcoming EU Summit Thumbnail Chart

Most of the major European indexes closed modestly higher today, the first day of a week that includes a highly anticipated EU summit, and a day after Gavyn Davies featured a sobering chart in his FT commentary, The Anatomy of the Eurozone Bank Run.

The EURO STOXX 50 index gained a quarter of a percent, and the Bloomberg table of European Stocks, which includes the STOXX 50 and the eight largest country indexes, showed only two declines for the day.

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Syria, Assad and the Arab Spring

Syria, Assad and the Arab Spring Thumbnail Chart

Last October I posted a commentary, Libya, Ghaddafi and the Arab Spring, shortly after Ghaddafi's death at the hands of the Libyan National Liberation Army. It was the third major Arab regime to be overthrown in 2011. Since that time Ali Abdullah Saleh has resigned the presidency of Yemen, which remains in a state of turmoil. And the media spotlight is currently on the escalating conflict in Syria.

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