May 2011

Chicago PMI Drops in May

by Glenn Busch May 31, 2011

The big impact from this report will be on the ISM that will be released a few days from now. The Chicago region contains a large percentage of the U.S. manufacturers and the Chicago PMI usually provides and advanced lead on the ISM, the big market mover. A weaker than expected Chicago PMI will most likely mean a weaker than expected ISM.

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Durable Goods & S&P 500 Correlation

by Glenn Busch May 27, 2011

The S&P 500 and the durable goods report are highly correlated. Have we’ve seen a clear break from the durable goods recent uptrend to change our short-term correction concerns towards recessionary concerns?

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S&P 500 vs U.S. Dollar: A Strengthening Dollar is a Concern

by Glenn Busch May 27, 2011

Another reason mentioned for our tactical reduction in equity exposure is the increased debt woes in Europe again. Our short-term concern is more about a strengthening U.S. dollar rather than a sovereign debt default. Of course a sovereign default would be terrible news but the strength of the U.S. dollar has had a larger impact on the U.S. stock market as evidenced in the chart below.

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Q1 2011 GDP Estimate, Inflation, and Its Impact

by Glenn Busch May 26, 2011

At first glance it looks good with a positive growth rate but the 2nd GDP estimate came in below expectations of a revision upwards to 2.1% on an annualized basis. The number is also well below 3%, the long-term average U.S. GDP growth rate, and far below where a growing economy should be after it has emerged from a recession.

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The Scariest Financial Statistic (and it’s NOT the US Government Debt)

by Adele Canetti May 26, 2011

So why, why, why do people manage their financial lives with zip, zero, nada margin for error? I can understand that many Americans are struggling these days, but is this the case even for those who own a $400,000 home , $20,000 vehicle or a $5,000 entertainment system?

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Asset Allocator’s Dilemma

by Glenn Busch May 26, 2011

Rather than reach for yield we’ve sought out alternative investments that provide the reduced volatility the cash would’ve provided and generate a rate of return above inflation, a real positive return on capital.

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April 2011 Durable Goods Report & Investment Implications

by Glenn Busch May 25, 2011

The durable goods report is considered an important leading economic indicator because of the clues it provides about future industrial production. However, as mentioned above, the indicator is volatile and fluctuates month-to-month. The trend of the indicator becomes more important. With 2 of the last 3 months showing declines in new orders are we seeing a new negative trend in this indicator?

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The Press and Big Changes Versus Small Changes

by Adele Canetti May 25, 2011

Investors and others need to ask themselves why a less than one half of one percent change in the number of problem banks merits bigger headlines than changes of 67% upwards in profits, or 60% downwards in loan loss reserves. These are both stunningly positive numbers and huge changes in the trend, but nowhere to be found in most of the headlines.

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CDs, The Way of the Dodo

by Glenn Busch May 24, 2011

The cloud computing revolution is affecting many areas of IT and data storage. One specific area in data storage that is being affected the most is optical data storage, CDs and DVDs. What companies will be harmed by a further decline in demand for optical storage? Imation Corp (IMN), for one, is a company that has [...]

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