Elevate My Market

It has been an extraordinary month of February for the U.S. stock market. It has received a steady stream of challenging if not outright gloomy economic news throughout the month. At the same time, corporate earnings growth forecasts for the coming year that were once positive by double digits only a few weeks ago have turned firmly negative. And the Chair of the U.S. Federal Reserve has made it rather clear, most recently in her testimony before Congress this week, that interest rates will soon be on the rise, most likely in June, which is earlier than market expectations. All the while, U.S. stock valuations have now crested the 20 times as reporting earnings mark on a trailing twelve month basis and are closing in on this frothy level on a forward basis too. But despite the fact that all of the news seems kind of gray, the U.S. stock market has only one place where it wants to go. It wants to go higher.

Please click on the link to read more of my article on Seeking Alpha.

Hawks Take Flight

U.S. Federal Reserve Chair Janet Yellen is scheduled to appear in front of Congress this week to present her semiannual testimony on monetary policy. And following a dovish interpretation by the markets of the minutes from the Fed’s Open Market Committee meeting in late January, investors should not be surprised if Ms. Yellen takes to the microphone on Tuesday and Wednesday with a more hawkish-than-expected tone about the Fed’s intentions for raising interest rates. The Fed wants to raise rates as early as June, and it seems they are running into a credibility problem in getting the markets to actually believe it.

Please click on the link to read more of my article on Seeking Alpha.

Will The ECB Kill The Gold Rally?

The European Central Bank is expected to take the latest “extraordinary” step in global monetary policy by announcing its own quantitative easing program on Thursday. One would reasonably think that the further debasing of a global fiat currency system that has only been in place for less than half of a century and has already been debauched beyond comprehension in the years since the outbreak of the financial crisis would be a tremendous boon for gold. And in recent weeks, it appears that gold has been gearing up for the big announcement. But in one of the many counterintuitive outcomes in this unusual post crisis investment world, recent history has shown that gold has performed very poorly in the wake of these extraordinarily accommodative monetary policy announcements.

Please click on the link to read more of my article on Seeking Alpha.

Is The Market To Be Hanged In A Fortnight?

It is a fortnight filled with events that have the potential to meaningfully shape the future direction of the market. Four separate episodes are set to play out over a current two week period, with each in isolation having major implications on how capital markets are likely to perform for the remainder of 2015 and beyond. The fact that they are all converging together at the same time only amplifies their potential impact. And unfortunately for investors, the risks associated with these events are currently tilted to the downside. The markets may not be hanged in a fortnight, but the mere fact that risk levels are elevated with so much unfolding over just two weeks should keep investor minds particularly concentrated as events continue to unfold.

Please click on the link to read more of my article on Seeking Alpha.

Stocks: Considering Life Without The Fed ‘Put’

It is a belief that has been firmly ingrained in the minds of investors for nearly three decades. It is the Fed ‘Put’, which is the expectation that the U.S. Federal Reserve will intervene aggressively to support stock prices during any sustained correction or market crisis. But following nearly three decades of pursuing this monetary policy approach, it is reasonable to question whether the days of the Fed ‘Put’ may now be over under the direction of new Fed leadership. If this is indeed the case, it is worthwhile to consider the potential implications for the stock market going forward.

Please click on the link to read more of my article on Seeking Alpha.

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