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SPDR S&P 500 ETF Trust Message Board

  • techglass1 techglass1 May 11, 2013 8:52 PM Flag

    Here is where we are in the cycle at what to watch for: 2013 into 2014

    World economies are desperately devaluing their currencies and cutting interest rates like crazy. Over 51 countries from the US to Australia, Polond, Japan, S.Korea have reduced interest rates over the last year. The EU has as well becasue of the unmanageable amount of debt they have. World economies are trying to recover from huge debt levels and anemic to recessionary growth. The starnge thing is that stock markets from Greece to the United States have taken off rising over 100% in many cases as investors have fled zero interest rate and conficatory banks and bonds for Stocks everywhere. In the United States there is marginable improvement: jobs are coming back slowly, housing is mildly improving and corporate profits are at records. The caveats are that revenue growth is very scare, corporate profits have been manufactured by stock buybacks and cost reductions, housing is only at 250,000 to 450000 units a year vs a normailized 800,000 and a huge percentage of the workforce has stopped looking for jobs and therfore are not included in the unemployment numbers at 7.5%. The stock market has embraced the QE forever policy and is up 26% since November. Most stocks are overvalued and the momentum is powerful as we make new highs every day. Shorts have been capitualting at these breakout levels. The next stage is for stocks to start melting up as valuations for growth stocks hit 40x earnings..the kaggards like the no growth cyclicals and technology stocks will move higher to 15-20x earnings despite the lack of growth. The economic reports on Industrial Production, manufacturing and consumer confidence will all be improved and become additional excuses to take already expensive stocks higher. Then as unemployment seems fixed stocks will peak and a rude awakening will befall investors as the market starts dropping. The fed will ahve no ammo left as Europe starts imploding as its huge debt levels break the EU once and for all. The US dollar becomes so strong multinationals

 
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