We’ll post the Housing Price Index (C/S HPI) as a separate post when it comes out, so drop by about 8:15 Central for that. Couldn’t sleep, so up early, venom about market hype being our first topic du jour.
Aggregate Index Calls BS
1998, or so, I began to develop an Aggregate Index. Reason? Single Market Indices are terribly misleading. Which is why you can have the Techs up one percent on a day when the down’s down a quarter-percent. The “truth” is somewhere in-between.
While the hyping-heads are trying to sell the last few remaining suckers the idea of “investing in stocks” because they’re a “good idea” let’s look at the so-called record highs. I write down all the data at the close and you know what it looks like?
Can you see the problem? Can you feel my pain, brothers and sisters?
I stick my fingers in my ears when the fin-chans are on. The eyes looking only at numbers and even these are not to be trusted.
Inflation Covers the Lie, Too
The second way Big Lies (about new “record prices”) is covered is by failing to mention INFLATION.
The problem with inflation is no one can really agree what it’s doing, ergo, trying to hold a meaningful conversation with an iPhone bauble-head becomes pointless.
One measure is the latest YoY *(year-on-year) measure in the Consumer Price Index. Sure, what the hell. Here it is: 1.7% before “adjustments.” (Which shouldn’t be needed for YoY matching periods, but simple statistics don’t exist, so let’s go with that, shall we?
July 24 of this past summer the Dow Industrials closed at 27,269.97. The close yesterday? 27,090.72. No cigar.
The S&P at that time was 3,019.56. But yesterday the S&P closed at 3,039.42.
But before the S&P people celebrate, we have the matter of 96 days of continuing inflation to consider. We could argue what portion of 1.7% annual to use. We could ruse American-style “banker’s rules” (based on a 360 day year) (0.266%) or the more honest 365-day year (0.263%).
OK, you win! The honest one it is: Yes the S&P – even on an “inflation-adjusted” basis made a record as soon as it passed 3,027.51
OR Did It?
If we were investing in UHD TV’s or Apples, such an index might be “realized” by looking at just this data. Bus stocks are financial instruments and they are prices based on how “easy” money is.
Let’s look at M2 back during the week when the previous market highs were set in July. M2 then? (4 week, unadjusted rate) $14,821.3 billion. In the latest week (closest to now)? $15,072.9. 1.6975%
Yes, the four-week rolling M2 is lofting skyward on a 6-month basis of 7.6% annualized, but that’s another discussion about MUM – making up money.
For now what matters is the old record S&P 500 in July – that 3,019 number – would need to bust through 3,070.81 on a close. Of course, no practicing economist could come right out and be so cynical as to think a HUGE three-month DOUBLE TOP is possible. Chart me!
We’ll update this tomorrow on (our high roller) $40/year Peoplenomics.com subscribers -only site.
You will have to forgive me, is the point, if I seem a bit grouchy about the hype festival. “Now that stocks are at record highs, the Fed is a risk that could stop the rally…” headlined one of the fin-chans. Figured all that out without help, did they?
Even a damn fool wouldn’t trust anything on television about this market. I know – because I am one.
Ahead of the Curve
(Or, the more things change, the more they stay the same…)
Demise of medical cannabis markets might be much ado about nothing. Unless you’re a prescribing doc who’s whittled a few scrips to stay alive in the malpractice insurance eats everyone’s life world.
Where’s Boeing Going? Look for clues today and see the NYT’s DealBook: What to Expect When Boeing’s C.E.O. Faces Congress Today.
If you have Bitcoins, or you’re a true believer in blockchains, might want to consider the implications of Google claims quantum computer completed 10,000-year task in 200 seconds. In the coming A.I. rev, there is no privacy, no security either.
Meantime, anyone up for ChiCoins? China Prepares to Launch Its Own Digital Currency as Facebook’s Libra Languishes.
And several readers have reported that snow has already hit their locations – a bit earlier than normal – whatever the hell that is, anymore. Winter storm advisories are up from Montanna, down through Wyoming and Colorado, even down to Armadillo (sic) Texas with a touch of Okielahoma and into Western Misery.
On the Califires, the Weather Service at press time was reporting
“The combination of strong offshore winds with very dry conditions and fuels will continue to lead to dangerous fire weather conditions across parts of California. A number of wildfires are currently burning across the state, including the Kincade fire (largest in the state) and Getty fire (west side of Los Angeles). Critical to extreme threats are likely to persist through mid to late week. Read More >
We continue with the early Luddite view that it’s not climate, it’s weather..but who listens to old men who’ve gone to the woods to hide from digital madness?
Prime Eats on the Fly
Elaine went to the story t’other day and came home to report her feet hurt. She was pushing the cart around the store for a couple of hours because she actually shops. That is, she looks at labels, looks for GMOs to avoid, reads ingredients, unit costs,. nutrition, preservatives, salt levels, and all that.
Then in the vegetable department, there’s a chat and a thorough search to see which heads of Romaine are freshest. A chit-chat at the deli counter, where the in-store baked turkey is sliced (#4 thick, please) as is the Organic roast Beef for Mr. CompuButt. The eat department is fun, talking to Kevin and Caleb, sharing adventures and eventually a 1-1/2″ thick porterhouse is cut for me… All this takes time. It’s a social outting, local news foray, and environmental change measuring all rolled into one.
But shopping is undergoing radical surgery. Daughter #2 has been using Amazon Fresh up in the Seattle area for years and loves it. Two ofour food purveyors offer to do shopping for us…and we’re going to give it a go.
Just today we noticed that Amazon makes grocery delivery service free for U.S. Prime members, too. Got it! Except, we can’t get deliveries like that out here. We can’t get cell service, either, but that ain’t all bad, esp. with 5G coming out to cook even more ears…
Since both Wal-Mart and Brookshires.com have local outlets that can reduce the visit to the store from a 4-5 hour multi-mission adventure quest down to one hour we’re going to try it a few times. It’s almost a half-hour each way into town, or back.
Elaine’s looking forward to our pending experiments and experiences and promises comments on how it works.
But in today’s work-your-butt-off all the time world, nice that online shopping is making progress. Something we can sink our teeth into, for sure.
Readers are welcome to comment on how it’s working for them, since we do have concerns about whether personal shoppers will really get the same “pick of the litter fresh” and no dented cans, that we do.
Write when you get rich, Or full.