Stocks & Equities

Leibovit Special Summer Offer

Posted by MoneyTalks Editor

on Friday, 03 August 2018 15:12


Why not make some money this summer? Mark wants this to be your most profitable month of the year! ~Ed


Stocks & Equities

Marc Faber: Won’t be surprised if Indian markets correct 20%

Posted by Marc Faber - Gloom Boom & Doom Report

on Friday, 03 August 2018 08:20

Screenshot 2018-08-03 08.09.00Marc Faber, editor and publisher of The Gloom, Boom & Doom Report, said he would not be surprised if Indian markets corrected 20% from current levels, but did not give a timeline for such a correction. In a phone interview from Chiang Mai, Thailand, the Swiss investor expressed concerns over the trade war, and said it is not beneficial to anyone.

What do you think could be the repercussions of global trade war on the world economy and markets?

There is less or hardly any growth in Europe. The Chinese economy has been slowing down, as well as other Asian economies. The US stock market by any measure is highly priced.

We have recessions in Argentina, Brazil and Turkey. We have currency weaknesses around the globe in dollar terms, which is a sign of monetary tightening, and now we have also this so-called trade war. Some people may suffer more, and some less but a trade war cannot be beneficial for anyone. In general, it is not a positive for the global economy or the financial markets.

Indian markets recorded new high today (Thursday). Do you think the rally in India is sustainable or do you think there is a correction in the offing for benchmark equity indices?

When (Indian) market hit a high earlier this year in January, my sense was that high would be an important one, but we made a new high.

Let’s put it this way, when I travel around the world and I visit financial institutions, first time India is really a subject. For the first time, investors think that India has an experience and a meaningful fundamental improvement due to the Modi government. They are not sure if it is the right time to invest now in India. Over the next 10 years, we want to have some money in India, regardless.

If you look at the S&P (500), and Indian stock market over the next 10 years, you will make more money in India than American shares. This has been my view for the last three years, and this remains my view.

Of course, if the global stock markets are going down— all the major markets, except India are going down. When everything is weak, and India is still strong, I will be reluctant to buy the market which is strong. It (rally) may last a little bit longer but it doesn’t mean it is good value. Valuations are not attractive other than a few exceptions.

How do you see it faring from here?

The bull market in India started in late 2015, We have seen a big move, I wouldn’t be surprised if there is a 20% correction. I cannot give you a date though.

If you put all your money now in Indian stocks, the reward in my opinion will not be great, as there are internal and external risks.


Timing & trends

Charts for the beach - 2018

Posted by Richard Bernstein of Richard Bernstein Advisors

on Friday, 03 August 2018 08:12

It’s time for our annual August report, “Charts for the beach.” Each year we highlight five of our favorite charts we think consensus is currently overlooking. Remember to ask your RBA representative for your official RBA eyeglass cleaning cloth to keep your sunglasses spotless!

Profits (not GDP or politics) drive the stock market.

At RBA, we approach the current environment by staying disciplined, slowing down the investment process, and by staying dispassionate with respect to politics.

Along those lines, our first two charts show US real GDP and corporate profits through time. There has been considerable hoopla about the strength of GDP growth during the second quarter, but US real GDP growth remains within a slow-growth band that has existed since the bursting of the Technology bubble in 2000 (See Chart 1).

(QoQ % Jan. 1946 – Jul. 2018)


Source: Bloomberg Finance L.P.

Chart 2 helps explain why the US bull market has been so powerful despite continued anemic GDP growth by highlighting corporate profits as a percent of GDP. The corporate sector’s proportion of national income rose to all-time highs post-2010. This ratio has smartly rebounded, which has fueled the more recent leg of the bull market.

Contrary to popular belief, the corporate sector (upon which the stock market ultimately focuses) has been historically healthy relative to the overall economy. The combination of tremendous liquidity provided by the Federal Reserve and an historically healthy corporate sector seems to justify both the length and magnitude of the 9-year bull market.

US Corporate Profits as a Percentage of GDP 
(4Q 1947 – 1Q 2018)

Source: Richard Bernstein Advisors LLC, BEA, Bloomberg Finance L.P.

We prefer fixed liabilities, not fixed income, during inflationary periods.

Data demonstrate that investors continue to focus on disinflationary asset classes and have yet to re-orient portfolios toward assets that outperform during periods of accelerating inflation. Unfortunately, inflation expectations troughed more than two years ago, and asset classes that benefit from accelerating nominal growth (stocks and commodities) have appreciated significantly whereas broad fixed- income has provided negative total return.

Chart 3 compares the returns of stocks, commodities, and various popular fixed-income benchmarks since July 2016. The ongoing popularity of income-oriented investments shows investors have yet to understand the implications of higher potential inflation.

Household and corporate balance sheets constructed with general combinations of fixed asset values and floating liabilities tend to outperform during periods of disinflation/deflation. However, a combination of floating assets and fixed liabilities has proven more beneficial during periods of inflation. FIXED-income is unlikely to be a successful core holding if we are correct and inflation continues to be higher than investors expect. Inflation is the kryptonite of income.



Gold & Precious Metals

Silver Holds It's Low & Novo Gets Interesting

Posted by Morris Hubbartt - Super Force Signals

on Friday, 03 August 2018 07:30

Today's videos and charts (double click to enlarge):

SFS Key Charts & Portfolio Analysis


SF Juniors Key Charts & Video Analysis



Stocks & Equities

$1 Trillion: Apple's Market Cap Hits Milestone

Posted by Hannah Genig

on Thursday, 02 August 2018 11:42


Today, Apple became the first American company valued at $1 trillion, following its strong third-quarter earnings report. Despite the rise of tough competition, Apple has remained steadfast in its focus on loyal users. This news reveals a stable company that not only encompasses a strong yearly growth rate of 5-10 percent, but also returns a majority of profit to shareholders.... CLICK for the complete article


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