#MACRO MODEL SHOWS US #STOCKMARKET AT RECORD OVERVALUATION AND OVERDUE FOR #BEARMARKET
Model in 2000 – 84%
Model in 2007 – 91%
Model in 2018 – 100%Via @mcm_ct pic.twitter.com/Vwscg4RLox
— OW (@OccupyWisdom) September 1, 2018
China Exports & Imports to US hit a brick-wall — US $200BLN in tariffs for China coming next week pic.twitter.com/9fo0txiqWE
— Alastair Williamson (@StockBoardAsset) September 2, 2018
FATHOM MODEL @fathommacro #recession probability is surging.
The model predicted 8/9 of the last recessions. pic.twitter.com/xUE9kRhx0m— OW (@OccupyWisdom) September 2, 2018
Key divergence between two consumer sentiment/confidence indices, now at the highest level since 1980. This spread widened prior to all the last recessions. See chart below: Conference Board Consumer Confidence vs University Michigan Consumer Sentiment Index. pic.twitter.com/Z5YlzNOyCp
— Otavio (Tavi) Costa (@TaviCosta) August 31, 2018
"Nearly $1 billion flees third-largest debt ETF…First, it was emerging markets. Then U.S. stocks. Now the flight from risk is spreading to bonds." https://t.co/asl9ifDHsH pic.twitter.com/f9M7iNVefo
— Trevor Noren (@trevornoren) August 31, 2018
rates have on a highly indebted nation
That’s where the #interestrates criticism originates
Stocks are a Fed induced bubble, & if it gets popped the #economy is going to have a serious #recession that will hurt everyone, not just the 10% who own stocks pic.twitter.com/OcMametlO1
— OW (@OccupyWisdom) August 31, 2018
GLOBAL #DOLLAR LIQUIDITY- BROAD MONEY SUPPLY#QUANTITATIVETIGHTENING
Via @MacroOps pic.twitter.com/IKAnPMe9F3
— OW (@OccupyWisdom) September 2, 2018
US Leading Indicators For Industrial Production seem to be fading here. Reflation attempt #3 via .@NewYorkFed could be like the last: failed. pic.twitter.com/rh0yMlha7S
— Alastair Williamson (@StockBoardAsset) September 1, 2018
PE Bands on $SPX — Maybe overvalued? pic.twitter.com/GYZJ8rHJCa
— Alastair Williamson (@StockBoardAsset) September 2, 2018
The important thing RE P/E valuation today is to understand collateralized loans funding share repurchases MEAN IF FIRMS RECEIVE COLLATERAL CALLS ON THOSE LOANS… non float shares will become FLOAT shares & raise P/E ratios, so real P/E ratio of $SPX is likely 50%+ higher (min) https://t.co/CGH3ON65do
— mcm-ct.com (@mcm_ct) September 2, 2018
OECD Economic Outlooks G7 Forecasts pic.twitter.com/4tTDXM3whp
— Alastair Williamson (@StockBoardAsset) September 1, 2018
If countries with current account deficits are experiencing a currency crisis, how long before the nation with the world's largest current account deficit experiences one too? What's worse is that while other nations borrow to fund capital investment, the U.S. borrows to consume!
— Peter Schiff (@PeterSchiff) August 31, 2018
#SP500 P/E RATIOS ARE AN ILLUSION CAUSED BY BUYBACKS, VIA @mcm_ct
1/ Stock #buybacks increase corporate leverage/#debt therefore it is a mistake to apply the old P/E ratio to the new P/E ratio, now with higher EPS – bc it is due only to the reduction of outstanding stock shares pic.twitter.com/xb3GPQuo1e
— OW (@OccupyWisdom) September 2, 2018
2/ Buybacks cause the stock prices to increase bc everyone has continued to assign the pre-buyback P/E ratio to the stock and the earnings per share EPS goes up. The value of the stock increased just by the company borrowing money and buying its own shares
— OW (@OccupyWisdom) September 2, 2018
3/ Except, that the company has spent BORROWED MONEY, or has a reduction in retained earnings (capital acct). The balance sheet says the equity portion has dropped, but the company’s liabilities haven’t. Therefore, the company is MORE leveraged than before, so, in effect, riskier
— OW (@OccupyWisdom) September 2, 2018
4/ The company’s P/BV (price to book value) and P/S (price to sales) has risen. The P/E ratio should be falling. People should not assign the same P/E ratio post-buyback, as the company had pre-buyback. pic.twitter.com/KONxf9wX0T
— OW (@OccupyWisdom) September 2, 2018
5/
So what happens when interest rates rise?
When companies need cash?
Margin called?
— OW (@OccupyWisdom) September 2, 2018