I’ve bludgeoned you over the years about how the Semi signal in January of 2013 was the first real proof that the positive economic cycle that is so readily obvious now was in play. We used the Semi Equipment book-to-bill ratio first and foremost per my little graphic here…
The theoretical progression was to be along the lines of Semi Equipment → Semi → Broad Tech → Manufacturing → Employment = Widespread acknowledgement of a strong economy.
So last year we (NFTRH) began the process of evaluating the reverse of the above, that would start the clock ticking on the “widely acknowledged strong economy”.
But in this age of interconnected information and sound bites flying at us with the power of 10 billion butterfly sneezes it is important to realize that the markets and especially the economy can move like aircraft carriers trying to turn in waters filled with all sorts of hyper active sharks, PT Boats, day traders, casino patrons, men, machines, substance abusers (info junkies) and Ma & Pa all trying to make some coin. In other words, the process can be real slooooow. Just as it was in turning to the positive side half a decade ago.
As the mainstream media were feeding this garbage to the masses… Fund manager looks beyond FAANG stocks and finds even bigger winners for 2018 … we took exception and did a little digging into the fundamentals, just as we did back in 2013.
NFTRH first included this daily chart of two premier fab equipment companies (as mentioned in the MSM article linked above) vs. the broad Semi sector. The first breakdown came in February.