Got yet-another crackpot view of the market that has evolved since our discovery of the “Market Heartbeat” that was laid out for Peoplenomics.com subscribers (Report 880B, “July 14, 2018: Heartbeat of the Market found! (Golem #1)“).
This new theory says the recent spike in selling could break and the markets could recover between now and early January. Then we will head down again into mid-to-late January.
I call this new tool The Timing Box and we’ll lay out how to construct your own in tomorrow’s Peoplenomics report. Key thing about this approach is that it is a hybrid of math and visuals. In other words, the construction of Timing Boxes isn’t something (like Elliott waves) where you just look at graphical wave counts – admittedly a subjective approach since the “counts” in Elliott are in the “eyes of the beholder.”
Timing Boxes are different in that they offer definable beginnings and estimated ends. One end is a buy zone and the other a sell zone. At the moment, this crackpot theory says we’re in a reasonable buy zone as of the Monday close. But, what they don’t offer is any insight as to the Fed’s rate decision tomorrow. Unless, saying we’re in a buy mode now, they are telling us the Fed won’t raise… We shall see…
What we think will happen will be something like a small rally today, perhaps fading late. Then, nervous selling by the markets ahead of tomorrow’s rate announcement.
THEN, hint the Trading Boxes, we have either put in the low yesterday OR will tomorrow, but then we could rally for a couple of weeks. It doesn’t eliminate judgement calls because either a) the Fed takes a pass tomorrow and we begin going up immediately of b) the Fed hikes and a wash-out low comes along Friday. Whatever.
Somehow in all this is the suicidal calculus of a government shutdown over the Border Wall.
Obviously, I’ll be watching the Fed closely. But, tomorrow’s Peoplenomics report should be of great interest to people who manage their own investments and carry the spreadsheet gene..
We’re at a point right now where it’s possible that the Markets have factored in about all the bad news than can be thought of. Year-end tax-loss selling has probably come close to running its course. The specter of a trade war is in limbo for another month, or two. And, in that period, we expect the democrats will take over the House and instantly move forward with Articles of Impeachment.
That, in turn, will pressure the Trump administration on trade because he will need to “put points on the board.”
Meanwhile, out in We The People Land, a lot of upper-middle and upper families will be discovering (to their horror) that yes, there really IS a cap on state, local tax deductibility of $10,000. In other words, while property taxes used to be uncapped as a write-off, so many people have bought “lake houses and second homes” that it may come as a rude spring awakening that anything over $10,000 worth of state income tax, property, and sales tax, will NOT be allowed. Tough on snowbirds?
When we take a longer view of “growth industries” one of the biggies is government. And since failure to “pay as you go” results in depreciated money and massive deficits, people ought to be solidly in the “pitchforks at the gate” mode in 2019, says our political consultant, Ben Dover.
The republicans will spew how it wasn’t their doing. (It was) and the democrats will offer options that will lock-in their retake of the White House (ala FDR) once we have finished the Trump rhyme off Herbert Hoover. Except, it is likely to have a “light Nixonian finish” to it.
In what we see as a 2019 where we scale-up a political clone of the present French tax microlution, the free lunch socialists will be making their moves in the US during 2019. The lefties are resting up for it, too, as we found in “Ocasio-Cortez takes time off for ‘self-care,’ laments loss of yoga sessions due to politics.”
So that, and this Only Chart That Matters…
Is how things kick off today. A bounce at the open, but seriously? We will refrain from going long, just yet. With the Fed decision in 30-hours a rally now could be buying the rumor before selling the news. Which resonates with our native bearishness.
You know, there’s an old saying: “No man’s home or property is secure when the state legislature’s in session.” The recycled thought template to remember today is “No man’s investments are secure when there’s a Fed rate decision pending.”
Since we’re not rushin’ to play “Powell Roulette” we take solace in cash during uncertain times. Not exciting as leverage day trading, but we can buy rum with it. Especially when our Trading Boxes tell us a short relief rally should be along to wrap up 2018. But, from which low?
This is always a dandy because economists and sociologists don’t communicate very well. Sociologists would argue that with a growing LBGTQ sector, we won’t need as many bedrooms since the birth rates will decline. Besides, everyone is living somewhere already, right?
Building Permits Privately-owned housing units authorized by building permits in November were at a seasonally adjusted annual rate of 1,328,000. This is 5.0 percent (±1.6 percent) above the revised October rate of 1,265,000 and is 0.4 percent (±1.7 percent)* above the November 2017 rate of 1,323,000. Single?family authorizations in November were at a rate of 848,000; this is 0.1 percent (±1.4 percent)* above the revised October figure of 847,000. Authorizations of units in buildings with five units or more were at a rate of 441,000 in November.
Housing Starts Privately?owned housing starts in November were at a seasonally adjusted annual rate of 1,256,000. This is 3.2 percent (±9.8 percent)* above the revised October estimate of 1,217,000, but is 3.6 percent (±9.4 percent)* below the November 2017 rate of 1,303,000. Single?family housing starts in November were at a rate of 824,000; this is 4.6 percent (±8.4 percent)* below the revised October figure of 864,000. The November rate for units in buildings with five units or more was 417,000.
Housing Completions Privately?owned housing completions in November were at a seasonally adjusted annual rate of 1,099,000. This is 0.4 percent (±8.7 percent)* above the revised October estimate of 1,095,000, but is 3.9 percent (±11.5 percent)* below the November 2017 rate of 1,144,000. Single?family housing completions in November were at a rate of 772,000; this is 5.4 percent (±7.6 percent)* below the revised October rate of 816,000. The November rate for units in buildings with five units or more was 314,000.
The economists will wring hands and say trickle this and tax cut that. But, in the end Reality appears in today’s Housing Start report from Census.
Weather begins to matter as up to 46-million may travel over the holidays: “Valley rain, mountain snow continue in Northwest; East Coast storm could bring travel delays.”
Stocking up on any government services provided may be a good idea because that has been Little Progress Made As Partial Government Shutdown Looms. The good news? Social Security will not stop because both political parties know that would be political self-destruction.
Social media is still dangerous as always. While Twitter tumbles on concerns about hacking activity, we see social media as eventually making it into the world of psychiatrists and social workers as Digital Diseases become apparent.
Madness on Bordering
The Media is still wrongly framing the Border. Notice in the headline 3 illegal immigrants indicted for murder of American whistleblower: report the use of “immigrants”? I would argue that unless they are papered in they are aliens. And yes, the term appears in federal law which people just conveniently forget.
(See 8 U.S. Code § 1611 – Aliens who are not qualified aliens ineligible for Federal public benefits OR 8 U.S. Code § 1365 – Reimbursement of States for costs of incarcerating illegal aliens and certain Cuban nationals, if you doubt it.
Reason for mentioning this? Apply your Labguage Filters carefully as you read “Asylum Seekers Stake Claims on a Patch of U.S. Soil at the Border With Mexico.”
As son George II quoted to me the other day: “If you’re a conservative and want to piss-off a liberal, tell ’em the truth. If you’re a liberal and want to piss-off a conservative, lie to ’em.”
And speaking of conservatives, did you see “‘Junk News’: Russia Report Done By Anti-Conservative Academics”? Everyone’s got an angle, huh?
Freedom of religion, meantime, is something we hold sacred (so to speak). And we think the West will have its hands full totally trashing and demonizing Vlad Putin who is standing up for religion as much (or more) than Western courts have. See Vladimir Putin Decries Prosecution of Jehovah’s Witnesses in Russia, if you’re not clear.
Had enough fun for now? Me too! Moron the ‘morrow!