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The Number of Millionaires Continues to Increase

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The Number of Millionaires Continues to Increase

Charlotte Wold | Updated March 29, 2017 — 2:27 PM EDT

The number of millionaires is growing rapidly and is concentrated largely in the U.S.. By comparison, overall the wealth growth since the millennium – $139 trillion – appears to have been slow since the Great Recession, according to a report released by the Credit Suisse Research Institute.

More Millionaires

The number of millionaires in the world has increased by 155%, while the number of ultra high net worth individuals (defined in the report as people with a net worth above US $50 million) increased by 216%. Of the latter, 51% reside in North America. According to a forecast included in the report, the U.S. will have the highest growth of millionaires in the world over the next five years.

How big? The number of U.S. households with a net worth of $1 million or more, not including primary residence (NIPR), increased by 400,000 to reach a record 10.8 million in 2016

In the U.S., there are 13.6 million people with $1 million or more in wealth, up 283,000 from last year. By the year 2021 the number of millionaires will reach 18 million – a 33% increase – significantly higher than any other country. Another report by Spectrem Group released in March, 2017, suggests that the number is even higher, the number of U.S. households with a net worth of $1 million or more (not including primary residence (NIPR)) increased by 400,000 in 2016.

Credit Suisse also suggests that inequality in the U.S. is on the rise. Although the average wealth is $345,000, the median wealth is only $30,000, a significant drop from last year and three times as low as countries with similar average wealth.

Global Wealth

In the UK, 406,000 people now find themselves outside the millionaire’s club, after US $1.5 trillion was wiped from the country’s household wealth. The decline is largely blamed on Brexit. Overall global wealth has grown 5.2% annually in terms of USD since the year 2000 – a modest growth, according to the report. In dollar terms wealth has grown by $139 trillion; by comparison, the estimated GDP of the entire world in 2015 is US $73.2 trillion.

Published at Wed, 29 Mar 2017 18:27:00 +0000

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Wall Street posts sharp gains, fueled by strong consumer data

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FILE PHOTO: A street sign for Wall Street is seen outside the New York Stock Exchange (NYSE) in Manhattan, New York City, U.S. December 28, 2016. REUTERS/Andrew Kelly/File Photo

Wall Street posts sharp gains, fueled by strong consumer data

By Lewis Krauskopf

U.S. stocks ended sharply higher on Tuesday, with financial and energy shares surging as data showed U.S. consumer confidence soaring to a more than 16-year high.

The S&P 500’s best day in nearly two weeks came after a record-setting rally for stocks in the wake of President Donald Trump’s election in November had stalled this month. The Dow Jones Industrial Average snapped an eight-day losing streak, which had been its longest run of losses since 2011.

U.S. consumer confidence surged to a more than 16-year high in March amid growing labor market optimism, while the trade deficit in goods narrowed sharply in February. The economy’s strengthening fundamentals were bolstered by other data showing further increases in house prices in January.

The data “underscore what has been going on really in this whole rally, and that is that confidence is pretty high and optimism is high and that has kind of been underpinning the resiliency of the equity markets,” said Jim Davis, regional investment manager at U.S. Bank Wealth Management in Springfield, Illinois.

The Dow Jones Industrial Average .DJI rose 150.52 points, or 0.73 percent, to 20,701.5, the S&P 500 .SPX gained 16.98 points, or 0.73 percent, to 2,358.57 and the Nasdaq Composite .IXIC added 34.77 points, or 0.6 percent, to 5,875.14.

Tuesday’s gains follow declines last week as investors fretted over Trump’s ability to enact his agenda after his fellow Republicans failed to pass their healthcare bill.

However, investors appear to have shrugged off the setback, choosing instead to focus on Trump’s promise of reforming the U.S. tax code, which has been a key driver in the post-election record rally.

“You have got maybe some rethinking of the political calculus related to the demise of healthcare, but what that may mean for a quicker focus on tax reform,” said Chuck Carlson, chief executive officer at Horizon Investment Services in Hammond, Indiana.

The financial and energy sectors, which have lagged the broader market this year, fueled the S&P 500 on Tuesday.

The financial sector .SPSY jumped 1.4 percent, with JPMorgan (JPM.N) and Bank of America (BAC.N) giving big boosts to the S&P 500. Energy shares .SPNY gained 1.3 percent, supported by stronger oil prices CLc1.

The Dow Jones Transport Average .DJT, seen by some as a barometer of the economy, gained 1.8 percent for its second-best day of the year.

Apple (AAPL.O) rose 2.1 percent and gave the biggest boost to the S&P and the Nasdaq, as the shares hit an all-time high.

In corporate news, General Motors (GM.N) rose 2.4 percent after activist investor David Einhorn’s Greenlight Capital urged the carmaker to split its stock into two classes.

Tesla (TSLA.O) rose 2.7 percent after disclosing that Chinese technology giant Tencent Holdings (0700.HK) had taken a 5 percent stake in the electric car maker for $1.78 billion.

Darden Restaurants (DRI.N) jumped 9.3 percent, making it the best performer on the S&P 500, after the Olive Garden owner announced quarterly results and said it would buy Cheddar’s Scratch Kitchen for $780 million.

Advancing issues outnumbered declining ones on the NYSE by a 2.91-to-1 ratio; on Nasdaq, a 1.63-to-1 ratio favored advancers.

The S&P 500 posted 18 new 52-week highs and 4 new lows; the Nasdaq Composite recorded 82 new highs and 33 new lows.

(Additional reporting by Yashaswini Swamynathan in Bengaluru; Editing by Anil D’Silva and Dan Grebler)
Published at Tue, 28 Mar 2017 21:06:46 +0000

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Investors yank $8.9 billion from U.S. stocks, most in 9 months

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Growing concern over handling of GOP bill
Growing concern over handling of GOP bill

  @mattmegan5

Doubts about the future of President Trump’s agenda have put Wall Street on the defensive.

Investors have yanked $8.9 billion from U.S. stock funds during the week that ended March 22, according to research firm EPFR Global. That’s the biggest retreat since last June.

Some of the hardest-hit stocks were the ones that soared after the election. Investors pulled money from banks, manufacturers and small-cap stocks, which have the most exposure to the fluctuations of the American economy.

At the same time, the Dow has backed away from all-time highs, losing 250 points this week. The index is on track for its worst weekly performance since the week before Trump’s victory.

Analysts point the finger at Republicans’ struggles to pass a bill repeal and replace Obamacare. Investors fear that a failure on health care could delay or even derail Trump’s promise of “massive” tax cuts — a pledge that has underpinned the rally on Wall Street.

“The Trump trade was always going to have a ‘where’s the beef’ moment,” Bank of America Merrill Lynch strategists wrote in a report to clients.

BofA said failure to pass the health care bill is “unlikely to cause a ‘TARP moment,'” referring to the 9% crash in the S&P 500 after Congress initially rejected the Wall Street bailout package in September 2008.da

Still, BofA said health care failure could cause a “credibility hit” that “temporarily” pushes stocks and Treasury yields lower.

EPFR said the exodus from U.S. stocks is a sign that investors have taken a “turn towards the defensive” as they question whether the Trump administration “has the necessary focus and political skills to get its economic agenda through Congress.”

For instance, investors yanked $1.1 billion from small-cap stocks last week, the most in six months, according to EPFR. Small-cap stocks are typically based in the United States, and investors had hoped Trump’s America First agenda and promise of 4% economic growth would juice profits. But the Russell 2000, which measures small-cap stocks, has started to struggle and lost 2% of its value this week.

Likewise, industrial stocks, a group expected to benefit from Trump’s focus on trade, suffered their biggest outflows since mid-January.

Banks were another big winner after the election amid hopes of higher interest rates, which allow banks to make more money, and less regulation. But investors withdrew $600 million from financial stocks in the last week.

So where are investors putting their money instead?

Emerging markets and bonds benefited from the U.S. uncertainty, with both enjoying significant inflows in the past week.

Gold, which tends to do well during times of investor fear, is also going back into style. Investors poured $1.1 billion into gold funds in the last week.

Looking ahead, the key for Wall Street will be whether it looks like Trump and Republican leaders can quickly pivot from health care to tax reform.

Treasury Secretary Steven Mnuchin on Friday promised that Trump’s new tax reform plan is coming “very soon.” He expressed confidence that tax reform will happen this year, if not by August as he originally predicted then definitely by the fall.

But tax reform won’t be an easy deal, either.

The Trump rally is “dependent upon the delivery of tax reform,” David Kotok, chairman and chief investment officer of Cumberland Advisors, wrote in a note to clients.

“The longer that process takes and the more questionable the outcome, the higher the risk to stock prices,” Kotok wrote.
Published at Fri, 24 Mar 2017 18:20:44 +0000

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Wall Street dips in dramatic session as health bill pulled

Traders work on the floor of the New York Stock Exchange (NYSE) shortly after the opening bell in New York, U.S., March 22, 2017. REUTERS/Lucas Jackson

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Wall Street dips in dramatic session as health bill pulled

By Lewis Krauskopf

A dramatic session on Wall Street ended with stocks slightly lower on Friday as they pared losses in late-afternoon trading after Republicans pulled their bill to overhaul the U.S. healthcare system.

The benchmark S&P 500 shot up briefly into positive territory before falling back into the red as Republicans pulled the legislation due to a shortage of votes just before the markets closed, leaving investors to assess how the healthcare bill’s failure would affect President Donald Trump’s broader economic agenda.

Investors had worried earlier this week that the failure of the bill, which would have dismantled the law known as Obamacare, would prove an ominous sign for Trump’s ability to push through his economic agenda, including tax reform.

But some analysts and investors have seen a failure of the bill as a catalyst to bring forward action on tax reform in particular.

“Now that they’ve taken the healthcare issue off the table, I think the market is more optimistic that they can do other things that are more doable that are not so complicated, such as regulatory reform and lowering taxes,” said Margaret Patel, senior portfolio manager at Wells Fargo Asset Management in Boston.

The Dow Jones Industrial Average .DJI fell 59.86 points, or 0.29 percent, to end at 20,596.72, the S&P 500 .SPX lost 1.98 points, or 0.08 percent, to 2,343.98 and the Nasdaq Composite .IXIC added 11.05 points, or 0.19 percent, to 5,828.74.

The back-and-forth over the bill this week has led to some of the most volatile trading Wall Street has seen since Trump’s election in November. For the week, the S&P 500 fell 1.4 percent, its worst weekly decline of the year.

“This is now an indication that the president’s agenda is probably going to be more ambitious than Congress can manage,” said Peter Kenny, senior market strategist at Global Markets Advisory Group, in New York. “It is probably going to mean that equity markets are going to have to factor in a degree of dysfunction that investors were hoping they wouldn’t have to.”

The S&P 500 has climbed 9.6 percent since Trump’s election, notching a series of record highs along the way. But the rally has stalled recently, and Tuesday’s 1.2 percent drop set off concerns about the beginning of a larger fall.

“The economy and earnings were doing better since before the election,” said Paul Zemsky, chief investment officer for multi-asset strategies and solutions at Voya Investment Management in New York. “If people want to drop the S&P by 300 points because this doesn’t pass, I and others will be down there to buy it.”

Shares of hospital operators finished sharply higher, with Tenet Healthcare (THC.N) up 7.4 percent. The potential dismantling of Obamacare has pressured hospital stocks over concerns the benefits the companies gained from coverage expansion would diminish.

In corporate news, Micron Technology (MU.O) jumped 7.4 percent after the chipmaker’s revenue and profit forecasts beat expectations. The stock was the biggest percentage gainer on the S&P and helped lift the Nasdaq.

GameStop (GME.N) tumbled 13.6 percent after the company’s profit projection fell below estimates.

Advancing issues outnumbered declining ones on the NYSE by a 1.07-to-1 ratio; on Nasdaq, a 1.30-to-1 ratio favored advancers.

The S&P 500 posted 19 new 52-week highs and three new lows; the Nasdaq Composite recorded 58 new highs and 40 new lows.

About 6.2 billion shares changed hands in U.S. exchanges, below the 7.1 billion daily average over the last 20 sessions.

(Additional reporting by Rodrigo Campos, Sam Forgione and Chuck Mikolajczak in New York and Tanya Agrawal in Bengaluru; Editing by Nick Zieminski and James Dalgleish)

 

Published at Fri, 24 Mar 2017 22:56:35 +0000

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Vehicle Sales Forecast: Sales Over 17 Million SAAR in March

 

Vehicle Sales Forecast: Sales Over 17 Million SAAR in March

by Bill McBride on 3/24/2017 02:20:00 PM

The automakers will report March vehicle sales on Tuesday, April 4th.

Note: There were 27 selling days in March 2017, unchanged from 27 in March 2016.

From WardsAuto: Forecast: U.S. March Sales to Reach 17-Year High

A WardsAuto forecast calls for U.S. automakers to deliver 1.61 million light vehicles in March, a 17-year high for the month. The forecasted daily sales rate of 59,776 over 27 days is a best-ever March result. This DSR represents a 2.6% improvement from like-2016 (also 27 days). March is anticipated to be the first month in 2017 to outpace prior-year.

The report puts the seasonally adjusted annual rate of sales for the month at 17.2 million units, below the 17.4 million SAAR from the first two months of 2017 combined, but well above the 16.6 million from same-month year-ago. …
emphasis added

From J.D. Power: March U.S. auto sales seen up nearly 1.9 pct -JD Power and LMC

U.S. auto sales in March will increase almost 1.9 percent from a year earlier, even as consumer discounts continue to remain at record levels, industry consultants J.D. Power and LMC Automotive said on Friday.

March U.S. new vehicle sales will be about 1.62 million units, up about 1.9 percent from 1.59 million units a year earlier, the consultancies said.
The forecast was based on the first 16 selling days of the month.

The seasonally adjusted annualized rate for the month will be 17.3 million vehicles, up from 16.8 million a year earlier.

Looks like another strong month for vehicle sales, but incentives are at record levels and inventories are high.

Published at Fri, 24 Mar 2017 18:20:00 +0000

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Premarket: 5 things to know before the bell

 

premarket stocks trading future
Click chart for in-depth premarket data.

  @AlannaPetroff

1. It’s a pullback, not a sell-off: Global stocks are in retreat mode Wednesday, but losses are relatively minor.

Investors are taking some money off the table following a record-setting, Trump-inspired rally. And they’re putting their cash into government bonds.

“There is no obvious explanation for the poor performance but markets might be starting to question President Trump’s ability to deliver on his policy promises,” said Andreas Johnson, an economist at Swedish bank SEB.

Crude oil futures also declined to trade at their lowest levels of the year, just below $47.50 per barrel.

U.S. stock futures were edging down a bit.

European markets declined in early trading, with many indexes down by about 1%.

Asian markets ended the day with losses. Japan’s Nikkei notched the biggest drop of 2.1%.

The moves follow a sizable drop for U.S. stocks on Tuesday. The Dow Jones industrial average fell 1.1%, the S&P 500 declined 1.2% and the Nasdaq was down 1.8%.

The pull back started on the same day that Bank of America Merrill Lynch released a survey showing that 34% of fund managers believe stocks are “overvalued”.

2. Stock market movers — FedEx, Nike, Fiat Chrysler, ING: Shares in FedEx(FDX) were being delivered up in extended trading while shares in Nike(NKE) were kicked down after both companies released new quarterly earnings.

Shares in Fiat Chrysler(FCAU) declined by 3% in Europe on reports that French prosecutors are investigating the auto group over cheating on emissions tests. The company did not immediately return requests for comment.

Shares in the Dutch bank ING(ING) dropped by about 6% after the company said it’s being investigated in Europe and the U.S. for issues related to “money laundering and corrupt practices.” It warned that potential fines “could be significant.”

3. Takeover turned down: U.S. firm PPG Industries(PPG) is not having much luck with its attempts to woo and acquire the Dutch chemical firm AkzoNobel.

AzkoNobel, which makes Dulux paint, said Wednesday is rejected a second unsolicited offer from PPG. The offer of cash and stock was valued around €22.4 billion ($24.2 billion).

Shares in AzkoNobel declined 3% in Europe after hitting an all-time high on Tuesday.

4. Housing market in the Trump era: Economists expect a report from the National Association of Realtors to show that sales of existing homes in the U.S. cooled off in February. The report is out at 10 a.m. ET.

Existing home sales increased 3.3% in January, which was the strongest pace of sales since early 2007.

5. Coming this week:

Wednesday – U.S. existing home sales report; Starbucks(SBUX) annual shareholder meeting
Thursday – Accenture(ACN) reports earnings; U.S. new home sales report
Friday – Samsung annual shareholder meeting

Published at Wed, 22 Mar 2017 10:16:44 +0000

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Dow slides nearly 240 as fear returns to market

Dow slides nearly 240 as fear returns to market

  @lamonicabuzz

Is the honeymoon period between Wall Street and President Trump over?

The Dow fell by about 238 points Tuesday, a drop of more than 1%. It was its biggest slide of the year and biggest decline since the election. The broader S&P 500 was also down more than 1%.

Neither index had ended the day with a 1% drop since mid-October. This was their worst day since September.

The Nasdaq, which includes many hot tech stocks such as Apple (AAPL, Tech30), Facebook (FB, Tech30) and Amazon (AMZN, Tech30), fell nearly 2%.

This recent market weakness seems to be a sign that the market tone has shifted to a more negative one, at least temporarily.

CNNMoney’s Fear & Greed Index, which tracks seven measures of market sentiment, is now showing signs of Fear. The index was in Extreme Greed territory just a month ago. It all just goes to show how quickly emotions on Wall Street can change.

In fact, some market watchers noted that when everyone is bullish, that’s usually a sign that the market could be due for a drop. Too much of a good thing cannot last.

“We are currently experiencing multi-decade high extremes of optimism, and we view this euphoria as a warning sign,” said Brad Lamensdorf, founder of research firm LMTR, in a report Tuesday.

Other market experts were suggesting that the slump was due to investors growing skeptical about how quickly things can actually get done in Washington.

“President Trump’s legislative agenda is getting mired in a congressional swamp, as starry-eyed optimism runs headlong into bloodshot realism,” wrote BMO chief investment officer Jack Ablin in a note to clients Tuesday.

Ablin alluded to concerns that some members of Trump’s own party are having with the Republican leadership’s plans to repeal and replace Obamacare, lower taxes and spend “bigly” on infrastructure spending.

Shares of the Health Care Select Sector SPDR ETF (XLV), which includes drug makers, insurers and other big health care companies, fell about 1%.

Caterpillar (CAT), which could be a big beneficiary of any new funding to build roads, bridges and a wall on the Mexican border, was down 3%.

“[Trump’s] health care proposal appears to be losing momentum faster than most NCAA brackets,” Ablin quipped, adding that some Republicans in Congress are “loath to racking up more debt” to pay for stimulus.

Some traders also cited a Reuters story that quoted Sen. Sherrod Brown of Ohio saying that Democrats would not support a “a wholesale rollback” of the Dodd-Frank financial regulation rules put into place during the Obama administration.

Brown is the top Democrat on the Senate Banking Committee. Reuters reported that he made the remarks at an American Bankers Association conference.

Bank stocks, which had rallied sharply since November on the hopes Trump would undo Dodd-Frank, were among the biggest losers Tuesday. Bank of America (BAC) plunged nearly 6% while JPMorgan Chase (JPM) and Wells Fargo (WFC) were down about 3%.

One market expert said that the recent slump in stocks shows that investors are now coming to the realization that Trump won’t be able to get everything he wants done as fast as he’d like.

“Trump is trying to be the CEO president. That doesn’t work in politics,” said KC Mathews, chief investment officer with UMB Bank. “Right now, it’s all about hope.”

But the selloff was broader than banks and health care stocks.

Detroit’s Big 3 auto stocks GM (GM), Ford (F) and Fiat Chrysler (FCAU) all fell about 3% even though oil prices were sliding. Auto sales tend to go up when gas is cheaper. But there are growing concerns that the best days for the car companies could be behind them.

Tech stocks fell too, even as the Nasdaq hit record highs earlier Tuesday.

This could be just a healthy pullback after a strong run for the market. Stocks are all still up for the year after all.

And White House press secretary Sean Spicer said Tuesday that the administration has “always cautioned” against looking at “one day” and noted that the market “still continues to be up tremendously.”

Few experts are predicting a correction — which is a 10% pullback from a market high. Even fewer see a bear market, a 20% drop or more, on the horizon.

Mathews said that if Trump doesn’t make any significant headway with Congress on some of his key initiatives by late summer, then that could spark a correction.

Bruce Bittles, chief investment strategist with Baird, agreed that it will be key for Trump and Congress to actually get something done in order for the market rally to keep going.

The bull market celebrated its 8th birthday earlier this month. Can it survive to hit a 9th next year?

“It’s usually buy the rumor and sell the news. But there is no news yet. There is optimism, but still a lot of caution,” he said. “If Washington gets gridlocked, then we run into headwinds.”

–Matt Egan contributed to this report

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Schedule for Week of Mar 19, 2017

 

Schedule for Week of Mar 19, 2017

by Bill McBride on 3/18/2017 08:11:00 AM

The key economic report this week are February New and Existing Home sales.

—– Monday, Mar 20th —–

8:30 AM: Chicago Fed National Activity Index for February. This is a composite index of other data.
—– Tuesday, Mar 21st—–

No economic releases scheduled.
—– Wednesday, Mar 22nd —–

7:00 AM ET: The Mortgage Bankers Association (MBA) will release the results for the mortgage purchase applications index.9:00 AM: FHFA House Price Index for January 2017. This was originally a GSE only repeat sales, however there is also an expanded index.

Existing Home Sales10:00 AM: Existing Home Sales for February from the National Association of Realtors (NAR). The consensus is for 5.55 million SAAR, down from 5.69 million in January.

Housing economist Tom Lawler expects the NAR to report sales of 5.41 million SAAR in February.

During the day: The AIA’s Architecture Billings Index for February (a leading indicator for commercial real estate).

—– Thursday, Mar 23rd —–

8:30 AM ET: The initial weekly unemployment claims report will be released.  The consensus is for 240 thousand initial claims, down from 241 thousand the previous week.8:45 AM, Speech by Fed Chair Janet L. Yellen, Opening Remarks, At the 2017 Federal Reserve System Community Development Research Conference, Washington, D.C.

New Home Sales10:00 AM ET: New Home Sales for February from the Census Bureau.

This graph shows New Home Sales since 1963. The dashed line is the January sales rate.

The consensus is for a increase in sales to 565 thousand Seasonally Adjusted Annual Rate (SAAR) in February from 555 thousand in January.

11:00 AM: the Kansas City Fed manufacturing survey for March.

—– Friday, Mar 24th —–

8:30 AM: Durable Goods Orders for January from the Census Bureau. The consensus is for a 1.5% increase in durable goods orders.10:00 AM: Regional and State Employment and Unemployment (Monthly) for February 2017

Published at Sat, 18 Mar 2017 12:11:00 +0000

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Wall Street flat as tech gains offset weakness in banks

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Wall Street flat as tech gains offset weakness in banks

By Anya George Tharakan

U.S. stocks were little changed on Friday as bank shares fell on lingering effects of the Federal Reserve’s less aggressive stance on future rate hikes, while a jump in Adobe lifted the technology sector.

The S&P 500 financial sector .SPSY was off 0.82 percent, led by losses in big banks including Wells Fargo (WFC.N) and Bank of America (BAC.N).

The index has outperformed in a post-election rally on bets of simpler regulations and on heightened expectations of higher interest rates.

The rally lost some steam after the Fed on Wednesday stuck to its outlook for a gradual tightening in policy following a widely expected quarter point rate hike.

“We got the rate increase that the market was looking for, albeit some of the future expectations were a little bit more muted then investors had been bracing for,” said Eric Wiegand, senior portfolio manager at the Private Client Reserve at U.S. Bank.

However, the S&P 500 is on track to score gains for the week, helped by the technology sector.

The S&P tech index .SPLRCT was supported on Friday by Adobe’s (ADBE.O) surge to a record high of $130.30 after the Photoshop software maker reported strong earnings.

At 12:33 p.m. ET the Dow Jones Industrial Average .DJI was down 0.74 points, at 20,933.81 and the S&P 500 .SPX was up 0.17 points, or 0.01 percent, at 2,381.55.

The Nasdaq Composite .IXIC was up 2.44 points, or 0.04 percent, at 5,903.20.

Eight of the 11 major S&P sectors marked slight gains, topped by a 0.54 percent rise in utilities .SPLRCU.

Amgen (AMGN.O) dropped 6.7 percent, weighing down the healthcare sector .SPXHC after analysts were unimpressed by results of a study on its cholesterol drug.

Amgen was also the biggest drag on the broader S&P 500 index and the Nasdaq.

Tiffany’s (TIF.N) shares rose 2.8 percent to $92.48, after the high-end jeweler’s fourth-quarter profit topped estimates.

Advancing issues outnumbered decliners on the NYSE by 1,696 to 1,181. On the Nasdaq, 1,437 issues rose and 1,315 fell.

The S&P 500 index showed fifty one 52-week highs and three lows, while the Nasdaq recorded 110 highs and 38 lows.

(Reporting by Anya George Tharakan and Yashaswini Swamynathan in Bengaluru; Editing by Anil D’Silva)
Published at Fri, 17 Mar 2017 16:59:13 +0000

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Market may stall if Trump can’t live up to the hype

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NY Fed president: Market sentiment improved under Trump
NY Fed president: Market sentiment improved under Trump

 Market may stall if Trump can’t live up to the hype

Has the easy money in the Trump bump rally already been made?

The stock market has cooled off a bit lately following its euphoric post-election run from November through the end of February.

Yes, the Dow, S&P 500 and Nasdaq are all still at or near record highs.

But it’s worth noting that CNNMoney’s Fear & Greed Index, a measure of seven different gauges of market sentiment, is now in Neutral mode. It had been showing signs of Greed — and even Extreme Greed — earlier this year.

One important indicator in the index, safe haven demand, is flashing Fear levels. Essentially, more investors are starting to flock to bonds over stocks. Bonds are perceived to be less risky, so this could be a sign that the market is growing a little more worried.

Two other measures in the index, that look at options trading and market volume, have even dipped into Extreme Fear territory.

That could be a worrisome sign.

Experts think that for the market to continue rising, Trump needs to prove that his economic policies can kick GDP growth into a higher gear as promised.

And there are some doubts.

Jeffrey Cleveland, chief economist at Payden & Rygel, said investors may be just a little too bullish on Trump.

He’s not suggesting that the markets are going to crash or that the economy is going to suddenly slow. But he does think it will be difficult for the president to fulfill his promise of getting the economy growing at 4% annual rate anytime soon.

The main reasons? There is just simply so much to do, and it’s not yet clear that Trump will be able to quickly reach a consensus with even Congressional leaders in his own party — let alone Democrats.

Tax reform. Unwinding Obamacare. Tweaking Dodd-Frank. Getting an infrastructure bill that could cost $1 trillion or more. All of this will require a lot of compromises, patience and time.

“The post-Trump optimism may not translate into real growth that quickly,” Cleveland said. “I’m not bearish, but I can’t make the 4% GDP math work. Wall Street could be disappointed.”

Frances Hudson, global thematic strategist at Standard Life Investments, is also a little wary of how bullish the market has become.

She argues that investors may be underestimating how tough it will be for Trump to convince hardline, deficit-hating fiscal conservative Republicans to buy into his plans for stimulus.

“There could be opposition to stimulus from some in the GOP. The Trump administration is more fiscally liberal than a lot of Republicans in Congress,” she said.

Of course, if Trump is able to get many, if not all, of his economic proposals approved in a somewhat speedy fashion, then stocks could wind up going off to the races again.

Ed Campbell, a managing director and portfolio manager with Prudential subsidiary QMA, noted that earnings for the fourth quarter were pretty solid.

He added that Corporate America’s profits should continue to improve thanks to some of Trump’s plans and the boost to consumer and corporate sentiment that has occurred since the election.

But he concedes that the market may be just a little too giddy and that there is still “risk and uncertainty in the U.S. political environment.”

The good news is that you’d be hard-pressed to find a strategist or economist predicting outright doom and gloom.

The so-called animal spirits that have been unleashed since Trump’s win do seem to be real — and maybe even spectacular for any Seinfeld fans out there.

The problem is that nobody seems to be worried about anything. And that’s often a recipe for a letdown.

“The economic expansion is still intact. It may last another 2 to 3 years if we get capital investment and productivity improvement,” said Atul Lele, chief investment officer of Deltec International Group. “But the rate of growth and momentum may slow.”

Published at Fri, 17 Mar 2017 15:01:03 +0000

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Fed raises rates as job gains, firming inflation stoke confidence

 

Fed raises rates as job gains, firming inflation stoke confidence

By Howard Schneider and Jason Lange| WASHINGTON

The U.S. Federal Reserve raised interest rates on Wednesday for the second time in three months, a move spurred by steady economic growth, strong job gains and confidence that inflation is rising to the central bank’s target.

The decision to lift the target overnight interest rate by 25 basis points to a range of 0.75 percent to 1.00 percent marked one of the Fed’s most convincing steps yet in the effort to return monetary policy to a more normal footing.

However, the Fed’s policy-setting committee did not flag any plan to accelerate the pace of monetary tightening. Although inflation is “close” to the Fed’s 2 percent target, it noted that goal was “symmetric,” indicating a possible willingness to allow prices to rise at a slightly faster pace.

Further rate increases would only be “gradual,” the Fed said in its policy statement, with officials sticking to their outlook for two more rate hikes this year and three more in 2018. The Fed lifted rates once in 2016.

Business investment “appears to have firmed somewhat,” the Fed said in language that reflected a stronger sense of the economy’s momentum.

Fresh economic forecasts released with the statement showed little change from those of the December policy meeting and gave little indication the Fed has a clear view of how the policies of Donald Trump’s administration may impact the economy in 2017 and beyond.

“With gradual adjustments in the stance of monetary policy, economic activity will expand at a moderate pace,” the Fed said, maintaining language it has used in previous statements.

Stock markets extended their gains .SPX and bond yields fell on the benign economic outlook and the continued steady path of interest rate rises signaled by the central bank.

“It relieves some of the fears we’ve had that perhaps the Fed was going to raise rates faster in the future. They’ve chosen not to signal that,” said Brad McMillan, Chief Investment Officer at Commonwealth Financial.

The Fed’s projections showed the economy growing by 2.1 percent in 2017, unchanged from the December forecast. The median estimate of the long-run interest rate, where monetary policy would be judged as having a neutral effect on the economy, held steady at 3.0 percent.

The unemployment rate Fed officials expect by the end of the year was unchanged at 4.5 percent, while core inflation was seen as slightly higher at 1.9 percent versus the previous 1.8 percent forecast.

Fed Chair Janet Yellen is scheduled to hold a press conference at 2:30 p.m. ET to discuss the policy statement.

The rate increase comes amid a broad improvement in the world economic outlook and a sense among Fed policymakers that the U.S. economy is close to the central bank’s employment and inflation goals.

According to the policy statement, risks to the outlook remained “roughly balanced,” the Fed said.

Minneapolis Fed President Neel Kashkari was the only official to dissent in Wednesday’s decision, saying he preferred to leave rates unchanged.

(Reporting by Howard Schneider and Jason Lange; Editing by Paul Simao and David Chance)

 

 
Published at Wed, 15 Mar 2017 19:46:04 +0000

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Wall Street dips as drug stocks drag; Fed meeting in focus

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 Wall Street dips as drug stocks drag; Fed meeting in focus

By Yashaswini Swamynathan

The S&P 500 and the Dow trended lower in afternoon trading on Monday as drug stocks fell, while investors awaited a widely expected interest rate hike later this week.

The 11 major S&P 500 sectors were all trading within small ranges, with the healthcare sector .SPXHC slipping 0.34 percent and on track to snap a three-day winning streak.

The index, which has been the second-best performer year-to-date, was dragged down by Merck (MRK.N) and Bristol-Myers (BMY.N).

A report by the Congressional Budget Office on costs associated with the Republican plan to replace Obamacare could harden opposition to the proposal, adding to the obstacles facing President Donald Trump’s first major legislative effort. The report is due as soon as Monday.

“There is a lot of uncertainty in the healthcare sector,” said Brant Houston, managing director at CIBC Atlantic Trust Private Wealth Management in Colarado.

“Until this whole debate plays out, investors are going to be a little bit concerned about how these stocks will perform.”

At 12:38 p.m. ET (1638 GMT), the Dow Jones Industrial Average .DJI was down 41.76 points, or 0.2 percent, at 20,861.22, the S&P 500 .SPX was down 2.34 points, or 0.09 percent, at 2,370.26.

The Nasdaq Composite .IXIC was up 5.93 points, or 0.1 percent, at 5,867.66, helped by Facebook (FB.O).

Investors also took on a wait-and-see stance ahead of the Federal Reserve’s two-day meeting that starts on Tuesday, where the central bank is widely expected to lift interest rates for the first time this year.

Traders have placed a 94 percent bet that Fed Chair Janet Yellen will announce an increase on Wednesday.

Her comments will closely tracked for clues on whether the central bank could become more aggressive on rates as the U.S. economy shows signs of improvement.

“I think all eyes will be on what the Fed does and, more importantly, what they say in their comments,” Houston said.

Shares of Mobileye (MBLY.N) jumped nearly 30 percent to $61.11 after chipmaker Intel (INTC.O) agreed to buy the driverless technology maker for $15.3 billion. Intel’s shares were off 1.9 percent.

Chipmaker Nvidia (NVDA.O), also involved in developing driverless technology, rose 2.2 percent.

Wynn Resorts (WYNN.O) was the top stock on the S&P, up 4 percent at $103.58 after Morgan Stanley reiterated its “buy” rating and said the company could gain a meaningful market share in Macau.

Advancing issues outnumbered decliners on the NYSE by 1,717 to 1,132. On the Nasdaq, 1,741 issues rose and 1,023 fell.

The S&P 500 index showed 31 new 52-week highs and three new lows, while the Nasdaq recorded 81 new highs and 34 new lows.

(Reporting by Yashaswini Swamynathan in Bengaluru; Editing by Sriraj Kalluvila)
Published at Mon, 13 Mar 2017 17:11:45 +0000

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Goldman sees U.S. rate hike in June after one in March

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 Goldman sees U.S. rate hike in June after one in March

Goldman Sachs economists said on Friday they stuck with their call that the Federal Reserve will increase interest rates next week but now see its next hike in June rather than September in the wake of a stronger-than-forecast jobs report for February.

 

They also revised their forecast on the timing for the Fed to begin balance sheet normalization, or a shrinkage of its bond holdings, to the fourth quarter from an earlier view of mid-2018, they wrote in a research note published on Friday.

 

(Reporting by Richard Leong and Jennifer Ablan; Editing by Chizu Nomiyama)
Published at Fri, 10 Mar 2017 15:32:39 +0000

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Schedule for Week of Mar 12, 2017

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By SideHustleCoach from Pixabay

Schedule for Week of Mar 12, 2017

by Bill McBride on 3/11/2017 08:11:00 AM

The key economic reports this week are Retail Sales, Housing Starts, and the Consumer Price Index (CPI).

For manufacturing, February industrial production, and the March New York, and Philly Fed manufacturing surveys, will be released this week.

The FOMC meets on Tuesday and Wednesday, and the FOMC is expected to raise rates at this meeting.

—– Monday, Mar 13th —–

10:00 AM ET: The Fed will release the monthly Labor Market Conditions Index (LMCI).10:00 AM: Regional and State Employment and Unemployment (Monthly) for January 2017

—– Tuesday, Mar 14th—–

6:00 AM ET: NFIB Small Business Optimism Index for February.8:30 AM: The Producer Price Index for February from the BLS. The consensus is for 0.1% increase in PPI, and a 0.2% increase in core PPI.

—– Wednesday, Mar 15th —–

7:00 AM ET: The Mortgage Bankers Association (MBA) will release the results for the mortgage purchase applications index.Retail Sales8:30 AM ET: Retail sales for February will be released.  The consensus is for 0.2% increase in retail sales in February.

This graph shows retail sales since 1992 through January 2017.

8:30 AM: The Consumer Price Index for February from the BLS. The consensus is for 0.1% increase in CPI, and a 0.2% increase in core CPI.

8:30 AM ET: The New York Fed Empire State manufacturing survey for March. The consensus is for a reading of 15.7, down from 18.7.

10:00 AM: The March NAHB homebuilder survey. The consensus is for a reading of  66, up from 65 in February. Any number above 50 indicates that more builders view sales conditions as good than poor.

10:00 AM: Manufacturing and Trade: Inventories and Sales (business inventories) report for January.  The consensus is for a 0.3% increase in inventories.

2:00 PM: FOMC Meeting Announcement. The FOMC is expected to increase the Fed Funds rate 25 bps at this meeting.

2:00 PM: FOMC Forecasts This will include the Federal Open Market Committee (FOMC) participants’ projections of the appropriate target federal funds rate along with the quarterly economic projections.

2:30 PM: Fed Chair Janet Yellen holds a press briefing following the FOMC announcement.

—– Thursday, Mar 16th —–

Total Housing Starts and Single Family Housing Starts8:30 AM: Housing Starts for February.The consensus is for 1.266 million, up from the January rate of 1.246 million.

8:30 AM ET: The initial weekly unemployment claims report will be released.  The consensus is for 242 thousand initial claims, down from 243 thousand the previous week.

8:30 AM: the Philly Fed manufacturing survey for March. The consensus is for a reading of 32.5, down from 43.3.

Job Openings and Labor Turnover Survey10:00 AM: Job Openings and Labor Turnover Survey for January from the BLS.

This graph shows job openings (yellow line), hires (purple), Layoff, Discharges and other (red column), and Quits (light blue column) from the JOLTS.

Jobs openings were mostly unchanged in December at 5.501 million compared to 5.505 million in November.

The number of job openings (yellow) were up 4% year-over-year, and Quits were down 3% year-over-year.

—– Friday, Mar 17th —–

Industrial Production9:15 AM: The Fed will release Industrial Production and Capacity Utilization for February.This graph shows industrial production since 1967.

The consensus is for a 0.2% increase in Industrial Production, and for Capacity Utilization to increase to 75.4%.

10:00 AM: University of Michigan’s Consumer sentiment index (preliminary for March). The consensus is for a reading of 97.0, up from 96.3 in February.

Published at Sat, 11 Mar 2017 13:11:00 +0000

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Fresh evidence women are better investors than men

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State Street: Why we commissioned the Wall St. 'Fearless Girl'
State Street: Why we commissioned the Wall St. ‘Fearless Girl’

  @byHeatherLong

Have you seen the statue of the “fearless girl” facing the Wall Street bull?

State Street Global Advisors put up the statue to mark International Women’s Day and it’s getting a lot of attention.

Here’s one more reason to sit up and take notice: Women are better investors than men, according to a growing body of evidence.

The big investment firm Fidelity says that female investors outperformed males last year by 0.3%. In fact, Fidelity found that females outdid men in the past decade.

Data from Openfolio, an investment tracking app, also found the same trend. Women have topped men every year for the past three years since Openfolio began tracking results.

“Women are doing better than men and with a lot less risk,” says Kathy Murphy, president of personal investing at Fidelity.

Men have a bad tendency to buy and sell stocks too often. Very few people have mastered the art of timing the market. So too much trading eats into the guys’ returns.

2017: The year of ‘financial feminism’

Terrance Odean, a professor at Berkeley’s Haas School of Business, who has spent his career studying investor trends, found that men traded 45% more than women in the 1990s. He blamed it on male overconfidence.

Women, in contrast, tend to be “buy and hold” investors. It’s exactly the advice famous money gurus like Warren Buffett and Jack Bogle give people: Put your money into cheap index funds and then don’t touch it for years — or decades.

“Women have long-term goals, and they stick with the plan,” says Murphy. They focus on saving and investing for retirement or a kid’s college fund, not on outsmarting the market.

But here’s where women still mess up: They tend to be great savers, but they are often fearful of the stock market. They lack confidence about investing, despite a growing body of evidence that women are gifted at it.

Former Wall Street power woman Sallie Krawcheck is on a mission to empower women to be financially savvy. She’s declared 2017 the “year of financial feminism.”

“We women will not be fully equal with men until we are financially equal with men,” Krawcheck told CNN’s Maggie Lake at the New York Stock Exchange. Krawcheck recently launched Ellevest, a financial firm geared entirely toward women. Ellevest’s tagline is “Invest like a woman, because money is power.”

Why women can’t rely on men to handle money

Nearly 90% of women are going to have to take sole control over their finances at some point in their lives, notes Kate Warne an investment strategist at Edward Jones. Women are getting married later, divorcing more and frequently outliving their spouses. They can’t rely on men to handle the money.

“Whether you’re afraid or not, investing is something you need to learn how to do,” says Warne.

She started reading investment advice books after college when she landed her first job. She realized she liked it so much, she changed careers and became an investment adviser.

Women don’t beat men by a huge amount — Openfolio found women outperformed men by about 0.2% last year — but that’s still a “win,” and can really add up over time if women keep their money in the market for decades.

Published at Wed, 08 Mar 2017 20:45:37 +0000

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Trump adviser is betting against the Trump stock rally

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Trump speech sends Dow above 21,000
Trump speech sends Dow above 21,000

Carl Icahn is such a fan of President Trump that on election night he literally left the victory party early to buy stocks that were crashing in the overnight markets.

Icahn was one of Trump’s earliest backers on Wall Street and the billionaire investor even agreed to serve as the president’s special adviser on regulatory reform.

Despite all that Trump enthusiasm, Icahn’s hedge fund seems to be positioning for the end of the Trump party.

Icahn Enterprises(IEP), which Icahn controls and serves as chairman of, quietly disclosed last week that it had a net short position in its investment portfolio of 128% as of the end of last year. That’s a fivefold increase from the end of 2015.

The net short position means Icahn’s firm is betting against 1.3 shares for every one share it’s betting on. In other words, Icahn’s investment portfolio will generally gain value when prices decline, and vice versa.

“I am concerned at this point that the market has run ahead of itself,” Icahn told CNNMoney in a phone interview on Tuesday.

Icahn said one “worrisome thing is that so much money has run into ETFs.” Icahn voiced concern that the flood of retail money into passive investments like ETFs will create a stampede when markets turn south.

However, Icahn explained that his firm isn’t as negative as suggested by the net short figure, which only covers its investment segment and not its various other holdings.

He noted that Icahn Enterprises has a lot of control positions that are not counted in the investment segment. For instance, Icahn Enterprises owns Pep Boys and manufacturer Federal-Mogul.

But Icahn Enterprises’ top executives sounded very cautious during last week’s conference call.

“We continue to have a fairly bearish view,” Icahn Enterprises CEO Keith Cozza said during the call.

“The market does seem to be priced for perfection,” he said.

Besides the short position, Icahn’s firm is also taking some defensive maneuvers. In December, it sold American Railcar Leasing for up to $3.4 billion and last week it unloaded the shuttered Trump Taj Mahal casino in Atlantic City to the company behind the Hard Rock Café for an undisclosed sum.

The investment company also refinanced $1.2 billion of debt and raised $600 million in cash through a stock offering. The firm’s balance sheet has slashed its total debt to the lowest level in nearly three years.

“It’s not the greatest time for large, long investments,” Icahn’s CEO said during the call.

Icahn executives voiced concern about “very high market multiples.”

The S&P 500 is trading at 17.9 times forward earnings, the highest P/E ratio since 2004, according to FactSet.

Valuation levels have climbed to high levels because the big Trump rally — the S&P 500 is up 11% since November 8 — has been fueled by expectations of tax cuts and other stimulus, not fundamental improvement in corporate profits.

Icahn Enterprises declined to explain which specific industries the firm is betting against. However, Cozza seemed worried about Trump’s trade plans, saying that “certain industries” are “especially susceptible to potential border adjusted tax plans.”

House Republicans have proposed a border adjustment tax that aims to encourage more companies to make things in the U.S. by imposing a tax on imported goods. Retailers are strongly opposed to a BAT because it could make the imported goods they sell a lot more expensive.

Icahn’s cautious positioning stands in contrast to his opportunistic stance back in early November. As global markets panicked over Trump’s victory, Icahn literally left the victory party in Manhattan early to buy “a lot of stock” in overnight markets.

“I’m sad I didn’t buy a lot more,” Icahn told CNN’s Poppy Harlow in early December.

But Icahn also signaled uneasiness over the rally in that interview, which was conducted as the Dow was fast approaching the 20,000 milestone. The billionaire said the rally had “gone too far.”

Of course, the markets have only gotten higher since then. Last week, the Dow zoomed past the 21,000 level following Trump’s well-received speech to Congress. CNNMoney’s Fear and Greed Index is flashing “greed” and last week it even tipped over into “extreme greed” mode.

This is hardly the first time Icahn has gone negative on the market. He emerged as a vocal bear in 2015, warning of a “catastrophe” in a September 2015 video dubbed “Danger Ahead.”

Icahn’s firm was 149% net short as of last June amid worries about a bubble in risky junk bonds.

But the numbers put out last week show that Icahn’s firm remains very cautious despite Trump’s victory.

Published at Tue, 07 Mar 2017 17:14:49 +0000

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Arizona Challenges the Fed’s Money Monopoly

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A police officer keeps watch in front of the U.S. Federal Reserve building in Washington, DC, U.S. on October 12, 2016. REUTERS/Kevin Lamarque/File Photo

Arizona Challenges the Fed’s Money Monopoly

By: Ron Paul | Sun, Mar 5, 2017


History shows that, if individuals have the freedom to choose what to use
as money, they will likely opt for gold or silver.

Of course, modern politicians and their Keynesian enablers despise the gold
or silver standard. This is because linking a currency to a precious metal
limits the ability of central banks to finance the growth of the welfare-warfare
state via the inflation tax. This forces politicians to finance big government
much more with direct means of taxation.

Despite the hostility toward gold from modern politicians, gold played a role
in US monetary policy for sixty years after the creation of the Federal Reserve.
Then, in 1971, as concerns over the US government’s increasing deficits led
many foreign governments to convert their holdings of US dollars to gold, President
Nixon closed the gold window, creating America’s first purely fiat currency.

America’s 46-year experiment in fiat currency has gone exactly as followers
of the Austrian school predicted: a continuing decline in the dollar’s purchasing
power accompanied by a decline in the standard of living of middle- and working-class
Americans, a series of Federal Reserve-created booms followed by increasingly
severe busts, and an explosive growth in government spending. Federal Reserve
policies are also behind much of the increase in income inequality.

Since the 2008 Fed-created economic meltdown, more Americans have become aware
of the Federal Reserve’s responsibility for America’s economic problems. This
growing anti-Fed sentiment is one of the key factors behind the liberty movement’s
growth and represents the most serious challenge to the Fed’s legitimacy in
its history. This movement has made “Audit the Fed” into a major national issue
that is now closer than ever to being signed into law.

Audit the Fed is not the only focus of the growing anti-Fed movement. For
example, this Wednesday the Arizona Senate Finance and Rules Committees will
consider legislation (HB 2014) officially defining gold, silver, and other
precious metals as legal tender. The bill also exempts transactions in precious
metals from state capital gains taxes, thus ensuring that people are not punished
by the taxman for rejecting Federal Reserve notes in favor of gold or silver.
Since inflation increases the value of precious metals, these taxes give the
government one more way to profit from the Federal Reserve’s currency debasement.

HB 2014 is a very important and timely piece of legislation. The Federal Reserve’s
failure to reignite the economy with record-low interest rates since the last
crash is a sign that we may soon see the dollar’s collapse. It is therefore
imperative that the law protect people’s right to use alternatives to what
may soon be virtually worthless Federal Reserve notes.

Passage of HB 2014 would also send a message to Congress and the Trump administration
that the anti-Fed movement is growing in influence. Thus, passage of this bill
will not just strengthen movements in other states to pass similar legislation;
it will also help build support for the Audit the Fed bill and legislation
repealing federal legal tender laws.

This Wednesday I will be in Arizona to help rally support for HB 2014, speaking
on behalf of the bill before the Arizona Senate Finance Committee at 9:00 a.m.
I will also be speaking at a rally at noon at the Arizona state capitol. I
hope every supporter of sound money in the Phoenix area joins me to show their
support for ending the Fed’s money monopoly.


Buy Ron Paul’s latest book, Swords into Plowshares, here.


Ron Paul

Dr. Ron Paul
The Foundation for Rational Economics & Education

Ron Paul

Congressman Ron Paul of Texas enjoys a national reputation as the premier
advocate for liberty in politics today. Dr. Paul is the leading spokesman
in Washington for limited constitutional government, low taxes, free markets,
and a return to sound monetary policies based on commodity-backed currency.
He is known among both his colleagues in Congress and his constituents for
his consistent voting record in the House of Representatives: Dr. Paul never
votes for legislation unless the proposed measure is expressly authorized
by the Constitution. In the words of former Treasury Secretary William Simon,
Dr. Paul is the “one exception to the Gang of 535” on Capitol Hill.

Copyright © 2006-2017 Dr. Ron Paul

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Published at Sun, 05 Mar 2017 15:11:10 +0000

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What Is Fueling This Rally

What Is Fueling This Rally

No matter where you stand politically and what you may think of President Donald Trump, you’ve got to admit that he’s a pure breed optimist. And just maybe, despite all the media poison and the political infighting, it is that very sense of good old fashioned American can-do optimism that continues to fuel the flames of the Saturn V mega rocket that has propelled equity markets to all time highs with apparently no end in sight.

2017-03-01_spoos_update

I wonder how many participants had a chance to enter before the rocket launch. Perhaps 2 or 3 percent tops? Now ask yourself this: How many are now still riding this campaign? A fraction of a percent maybe? So if you’re a loyal reader here and traded along your humble host then consider yourself part of a very small and exclusive group of traders.

I’m not saying that to pad our own backs or reel in momentary glory. First of all this is not the first time we’ve caught a trend (although this one thwarts almost everything I have witnessed) and secondly you’re only as good as your last trade. But the take away message for all of us once again is that you do not need to be a genius, that you don’t need to attend expensive seminars or buy dozens of trading books, to become a consistent trader. That’s the good news. The bad news for many however is that there are no shortcuts.

What is required most of all are the qualitative aspects of trading: determination, diligence, consistency, and discipline. Trading is an acquired skill and not a academic one. As such it’s much more comparable to playing the piano than studying for an exam. The educational aspects are of course an essential part of it, but just like studying the law doesn’t make you a good lawyer, reading books on how to trade doesn’t make you a good trader. You simply become a good trader by trading, and by making many small mistakes. By following a simple set of rules which we post here on a daily basis and have been doing so over the past eight years.

2017-03-01_gold_update

Gold was unfortunately taken to the woodshed overnight and our campaign ended before it managed to get out of the gate. We raked in 1.5R plus minus here which ain’t bad but not what we had hoped for.

2017-03-01_silver_update

Silver on the other hand is still in the running and I’ve advanced my trailing stop to < 18.275. It either gets going now or most likely we’ll see another visit of those daily NLSL near the 18 mark. Where I incidentally may enter again if conditions favor it.

2017-03-01_corn

Corn is a potential long here but not just yet. I’m waiting for a pronounced spike low preferably followed by a retest. Reason for my interest in a long position is the daily panel which requires little explanation.

2017-03-01_AUDUSD

AUD/USD joined gold in the woodshed and I’m actually re-entering here, which is something I very rarely do. My justification is technical of course and based on the daily panel which shows us a touch of two Net-Line Sell Levels (NLSLs) as well as the still rising 25-day SMA. If that won’t hold then the Ozzie Dollar is most likely going to slide to 0.76 or lower.

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Published at Wed, 01 Mar 2017 14:00:52 +0000

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The Trader’s Wire Market Update for Friday, March 3, 2017

The SPX declined 14.04 points yesterday to close at 2381.92, giving back 43% of Wednesday’s gain.

TOT daily traders, who had been 200% long for Wednesday’s big rally, were on the sidelines  yesterday and gave back none of Wednesday’s gains.

Short-Term

The daily model is bearish again today.  TOT daily traders are advised to go 200% short at SPX 2380 stop; 2377 limit.  If and when you go short, use a protective buy stop at SPX 2404.

Intermediate-Term

The Intermediate Term Model is bearish.  This signal was wrong for a surprising amount of time, but at the present time, it seems more likely than the more commonly held bullish perspective.

Long-Term

The super long term perspective (a prediction, not a forecast!) for the stock market remains bearish (as it has been since January 2000 after having been bullish for over 25 years, from December 1974 until then).  I believe that, adjusted for REAL inflation (not the funny numbers the Social Security Administration uses) the stock market will be lower in real dollars in 2020 than it was in 2000.  For a long time, I’ve been saying, “I also expect that our new 2016-elected President will have some very serious problems during his/her single term in office.”  That belief stands.

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Schedule for Week of Mar 5, 2017

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Schedule for Week of Mar 5, 2017

by Bill McBride on 3/04/2017 08:09:00 AM

The key report this week is the February employment report on Friday.

Also the January Trade Deficit, and the Q4 Quarterly Services and the Fed’s Q4 Flow of Funds reports, will be released this week.

—– Monday, Mar 6th —–

10:00 AM: Manufacturers’ Shipments, Inventories and Orders (Factory Orders) for January. The consensus is a 1.1% increase in orders.
—– Tuesday, Mar 7th—–

U.S. Trade Deficit8:30 AM: Trade Balance report for January from the Census Bureau.This graph shows the U.S. trade deficit, with and without petroleum, through December. The blue line is the total deficit, and the black line is the petroleum deficit, and the red line is the trade deficit ex-petroleum products.

The consensus is for the U.S. trade deficit to be at $48.5 billion in January from $44.3 billion in December.

3:00 PM: Consumer credit from the Federal Reserve.  The consensus is for a $18.3 billion increase in credit.

—– Wednesday, Mar 8th —–

7:00 AM ET: The Mortgage Bankers Association (MBA) will release the results for the mortgage purchase applications index.8:15 AM: The ADP Employment Report for February. This report is for private payrolls only (no government). The consensus is for 183,000 payroll jobs added in February, down from 246,000 added in January.

10:00 AM: Monthly Wholesale Trade: Sales and Inventories for January.

—– Thursday, Mar 9th —–

8:30 AM ET: The initial weekly unemployment claims report will be released.  The consensus is for 238 thousand initial claims, up from 223 thousand the previous week.10:00 AM: The Q4 Quarterly Services Report from the Census Bureau.

12:00 PM: Q4 Flow of Funds Accounts of the United States from the Federal Reserve.

—– Friday, Mar 10th —–

8:30 AM: Employment Report for February. The consensus is for an increase of 195,000 non-farm payroll jobs added in February, down from the 227,000 non-farm payroll jobs added in January.The consensus is for the unemployment rate to decline to 4.7%.

Year-over-year change employmentThis graph shows the year-over-year change in total non-farm employment since 1968.

In January, the year-over-year change was 2.34 million jobs.

A key will be the change in wages.

Published at Sat, 04 Mar 2017 13:09:00 +0000

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