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Strebler's Perspective

February, 2017 Archives

How High?

By Jon S. Strebler

 

We’re long past “Is the stock market bullish or bearish?”, and well into the “How high can it go?” phase. More people are weighing in on that question, and surely we’ll be reading more and more on the topic.  

 

Our own Dow Theory Team wrote about the very important psychological stages of markets last Friday, and also on the value of keeping an eye on market breadth, e.g. the A/D line, which we would do well to keep in mind going forward. Richard Russell often reminded us of the folly of trying to guess how far a bull (or bear) market could go. It was, he believed, an exercise in futility; instead, stay with the primary trend until it changes, he advised. That is the reason Richard created the Primary Trend Index (PTI) decades ago, and it has served readers well.

 

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Financial Deregulation

by Jon S. Strebler

The FDIC shows the following national average rates paid to depositors as of last Friday, who are the major source of funds for banks. These rates are essentially the same as rates shown by the FDIC for November 6, 2016 – before the election and the beginning of a spike in interest rates. In other words, banks have not had to pay depositors significantly more today than they did in early November. And by the way, these rates for jumbo deposits aren’t much different than what people get on smaller deposits; either way, just about nothing!

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Revolution?

By Jon S. Strebler

The US stock market’s period of sideways indecision lies even further back in our rear view mirror after the action of the past few days. Yesterday all major US stock indices scored new highs for the third day in a row, as the value of the S&P 500 topped $20 trillion. This has added even more credibility to calling this one of the rip-roaringest bull markets of all time, while at the same time some analysts are saying it’s time for the bears to finally throw in the towel. 

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Deregulation: SAD?

by Jon S. Strebler

 

Economics lies at the heart of business and finance. And at the heart of economics is the truism that there’s never enough to go around – of virtually everything, everywhere, every time. Economics determines what gets made, how and where it gets made, and who gets whatever is made. Right along with economics’ basic truism is the concept of trade-offs: Everything has a cost (and not just financial), and if you want more of something, you’re going to have to accept less of something else.

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