In an April 30 video I said that income tax collections have been surging this year due to higher taxes, both from higher tax rates and capital gains payments resulting from sale of assets prior to 2013′s higher rates. The facts I reported April 30 are now coming to light three weeks later. The bullish twist on the news, that deficit reduction means we must have economic lift off has become an overnight feel good phenomena for those fully 100 percent long stocks. Read More
April income tax payments sent in by individuals are surging, up by more than $50 billion over April 2012 and higher by $63 billion year to date. That means to me that year end 2012 income from asset sales and bonuses had to have spiked by around $300 billion to generate that $63 billion in bigger tax payments. I know, this is a lot of numbers and some of you should read the transcript instead of this video. To go back, in other words anticipation of this year’s higher taxes created a one time 10 percent pop in income over those few months the $300 billion became income! Read More
As we start the last week of March, seasonal factors are likely to create a very volatile stock market through April, taking investors on a rollercoaster ride. That’s despite the two underlying bullish realities: The Fed is pumping up stocks by creating $4 billion of fake money every day. Meanwhile, companies are shrinking the float of shares by at about $2 billion every day. Read More
Hit the play button on commentary from bullish Wall Street portfolio managers and their major explanation for why stocks will head higher is that the U.S. economy is obviously recovering. I agree that stock prices are more likely than not to keep rising over the next few months. But the gain has nothing to due with the U.S. economy and everything to do with the Federal Reserve creating $1 trillion of new money annually on the top of the U.S. government creating $900 billion out of thin air this year. Read More
The Bureau of Labor Statistics guessed that 236,000 jobs were added in February and everybody applauded. Yay, or should we say, “boo.” What most everyone missed is that even the BLS admits in a footnote to its February jobs press release that historically its initial number can be revised as much as 90 percent. A 90 percent revision to me means that the February 230,000 job number is meaningless. Read More
In a two-part conversation, TrimTabs’ Charles Biderman and Jim Bianco discuss a variety of topics, including the sequester’s over-blown impact and a risk-less stock market created by the government’s never ending quantitative easing. Click Here to see the videos’ talking points.
Welcome to the new recession. TrimTabs tracking of real-time wages and salaries shows that the United States has entered into a recession this year. I had been predicting a slowdown after the big bump in December incomes due to the hike in taxes. It has taken a while for us to get a handle on income this year given all the changes in tax rates. But now enough time has passed that I can say I was right. The U.S. economy has slowed enough to enter into recession. Read More
This government sequestration BS is driving me nuts. I can no longer watch the TV talking heads describing how horrible sequestration will be. The talking heads are saying that if sequestration happens, airports will close, aircraft carriers won’t sail, national parks will close and hundreds of thousands of jobs will be lost. Read More
Driving down to Sausalito this morning I was listening to someone on the radio talk about how, in hindsight, he wished he’d acted differently.
That resonated with me, considering how I have misjudged the impact of central bank money creation on stock prices since 2009. That’s because I did not know, along with most everyone else, that Fed money creation had been invisibly increasing demand for equities. However, I did know enough to realize that there was something seriously out of whack in terms of normal supply and demand and the markets’ big gains. So while I did get the direction of the markets wrong, I knew enough to consistently hedge. And that has minimized capital losses for both me and Biderman’s Market Picks model portfolio. Read More