CategoryNewswire

The cyclically adjusted price-earnings ratio (CAPE) is among the most potent academic finance concepts. It estimated long-term equity returns reliably. 150 years of equity market history is plotted in the first chart below. The broad-based US equity market is currently priced at about a 34 CAPE, which coincided with a negative return during the subsequent ten …

The chart compares the COVID-19 policy response for selected countries. Efficiency is measured from a humanitarian and economic point of view. South Korea and Finland had the best response according to this benchmark. Both countries recorded a relatively low death rate and GDP impact. The United Kingdom and France performed the worst. Canada and Germany …

The job market is losing momentum. That’s typical during the late-cycle stage. It is less likely during the recovery phase. Likewise, a job market that rolls over is a statistically significant early indicator for an upcoming recession. Although a rollover is unconfirmed at this junction, the current jobs picture also fits best to a double-dip …

Economic activity is reminiscent of early 2020. The data indicates a double-dip scenario, which is not priced in the equity market. chart via @ISABELNET_SA

Multi-decade high valuations, a President pumping the stock market, robinhooders, excessive option bets, David Portnoy, crypto “assets”, central banks market-making negative-yielding government debt, and the longest expansion in U.S. history… We’ll be laughing with our grandchildren about how nobody could have seen a bubble!

Amazon is another S&P 500 heavyweight that shows a consolidation pattern. The online retailer reached an all-time high in early September. Subsequently, a 3-wave pullback initiated a correction. Price action consolidated sideways during the past three months. The pattern is typical for the consolidation of a larger trend. Most often, price action eventually resolves in …