Capitalogix

Are You an Optimist, Pessimist, Realist or Opportunist?

A simple explanation of what happens in the Market.

 

 

 

 

Are you an Optimist, Pessimist, Realist or Opportunist?

Some Interesting Links for Your Weekend Reading

 

Here are some of the posts that caught my eye. Hope you find something interesting.

Lighter Links:

• What's an Entrepreneur?  Here’s a Great 25-Word Definition. (Inc)
• Jeremy Lin Applies for Trademark on 'Linsanity'. (HuffingtonPost)
• You're More Likely to Win if You Trail at the Half. (HBR)
• Special Deals at Whole Foods Often Come at a Higher Price. (DanAriely)
• Electric Shock Machine Can Boost Learning & Memory. Will it be misused? (DailyMail)

 

Trading Links:

• What Does Wall Street Do for You? (NYTimes)
• Hedging Against Something Going Right: How to Play Global Growth. (Barrons)
• Quantitative Trading Ideas from a Psychologist. (EPChan)
• Economic Indicator? How About Picture Framing? (NYTimes)
• A Real Market Economy Ensures that Greed is Good. (FT)

The Market Rally Seems Longer Than It Really Has Been

Is This Market Rally Too Overbought to Trust?

While the optimists, pessimists and realists argue about whether the rally has gone too far (or is 'fake' because of government intervention) ... opportunistic traders have enjoyed the ride.

So how far and long has this rally really come?  Despite all the worrying, objects in the rear-view mirror may be closer than they seem.

The graphic (below) from Chart of the Day, puts over a century of market rallies in context.

As the Dow Jones Industrial Average flirts with post-financial crisis rally highs (and the 13,000 level), it may seem as if the current market rally has grown long-in-the-tooth ...

Nonetheless, history says rallies can go much longer and higher than this.

To provide some perspective to the current Dow Jones market rally that began back in early October 2011, all major market rallies of the last 111 years are plotted on this chart. Each dot represents a major stock market rally as measured by the Dow.

 

 As the chart above illustrates, the Dow has begun a major rally 28 times over the past 111 years which equates to an average of one rally every four years.

Also, most major rallies (78%) resulted in a gain of between 30% and 150% (29.8% to 150.5% to be exact) and lasted between 200 and 800 trading days (9.5 months to 3.2 years) -- highlighted in this chart with a light blue shaded box.

As it stands right now, the current Dow rally (hollow blue dot labeled you are here) would be classified as well below average in both duration and magnitude.

Interesting.

Related articles

• SPX Update: Why This Rally Is One for the History Books (minyanville.com)
• The Rally Is Going Into Overdrive Right Now (businessinsider.com)

A Quick Look at the Where the S&P 500 Sits

Sometimes reading a chart is simple. 

Here is the obvious question: Will the the S&P 500 Index be able to stay above its 2008 to 2012 resistance line (marked by red arrow on this weekly chart)?

 

 

The recent highs (at 1370) are directly overhead.  A move above that would be decidedly bullish.

 

Nonetheless, the recent rally is extended and happened on low volume. 

Bears will note that there are many negative divergences, too.  

However, the key indicator is the price action ... and it has been un-relentingly higher (despite many logical reasons for it not to have happened).

Related Articles

• Some Divergence Here (by Springheel Jack) (slopeofhope.com)
• SPX Update: Do-or-Die Week for the Big Picture Wave Counts (minyanville.com)
• Keeping an Eye on NYSI and S&P 500 Index (slopeofhope.com)

Some Fun Links for Your Weekend Reading

With all that is going on ... here is a clear and present danger for the economy.

 

 

 

Here are some of the posts that caught my eye. Hope you find something interesting.

Lighter Links:

• Another Lesson from Steve Jobs. A Driving Vision Has 4 Key Elements. (FastcoDesign)
• Facebook Worm Steals Log-In Credentials, Tests Against Other Services. (eWeek)
• A Happier Meal. McDonald's Agrees to Stop Using Ammonia in 'Meat'. (TheDaily)
• Carbs Are Killing You.  This Infographic is worth a look. (Food&Tech)
• Electronic Security a Worry in an Age of Digital Espionage. Check-out this piece on travel safety. Interesting. (NYTimes)

 

Trading Links:

• How Wall Street Turned a Crisis Into a Cartel. (Bloomberg)
• Was the $25 Billion Foreclosure Settlement a Stealth Bank Bailout? (Time)
• The Fed Will Publish Forecasts on Rate Moves to Guide Expectations. (NYTimes)
• Six Top U.K. Investors Share Their Views on the Markets. (Citywire)
• Saudi Arabia Said It Would Not Let Oil Go Above $100. (CNBC)

Funny Video: Using "S*** Happens" to Explain Economics

You don't normally see an economist do a stand-up routine.

And you could assume that economist Yoram Bauman doesn't usually swear while giving a speech ... but it's unavoidable in this routine ("S*** happens: the economics version").

 

 

This take-off on the old joke about explaining world religions (using the same construct) was filmed at the 2012 American Economic Association humor session.

It's even a little funny that the AEA had a humor session.

Click here for more Stand-up Economist videos.

Related articles

• What's so funny about money? (newscientist.com)
• Interview with Stand Up economist Yoram Bauman (calculatedriskblog.com)

Social Media Explained with Donuts

So much social media ... so little time.

This photo of a whiteboard (titled "Social Media Explained") went viral on many social networks last week.

So, chances are you've seen it.  If not, it's worth a glance.

Simple, clever, and so true.

 

 

For me, Twitter is a serendipity engine;  I dip into it and hope to find something cool. LinkedIn is a bit more serious and I often find a link worth spending some time reading.  While Facebook is a guilty pleasure, where I browse to catch-up on what people are doing and to get a glimpse into their lifestyle and interests.  The rest ... (and texting) ... not so much.

What about you?

Related articles

• 10 Social Media Tips for Bloggers (mashable.com)
• Your Friends Are Now Your Customers (blogs.hbr.org)

Why Did the Clint Eastwood "It's Halftime America" Ad Cause Such a Stir?

Did you see the Clint Eastwood "It's Halftime America" video that ran during halftime of the Super Bowl?

It starts with Clint Eastwood's voice and an image  of a lone man casting a big shadow as he walks down a darkened football stadium corridor.

 

"It's halftime ... Both teams are in their locker room discussing what they can do to win this game in the second half. It's halftime in America, too."

 

 

 
Well, it got noticed ... and it's causing a controversy in some circles.

So much so that SNL made fun of the issue in this spoof.

 

 

 

"I don't care if Obama runs the ball, or Romney throws a touchdown, or Ron Paul kicks a field goal with his tiny little chicken legs," Hader-as-Eastwood warns. "I tell you right now, though, I ain't puttin' Santorum in the game. He can stand on the sideline doin' cheers in his little sweater vest."

 

Sometimes it seems that we become so focused on pointing fingers and finding fault that we forget our real purpose.

To paraphrase Freud, sometimes an ad is just an ad. 

And in this case, it could simply be an inspiring ad paid for by Chrysler (perhaps to say " we faced some hard times, but showed resiliancy and resolve ... and the best is yet to come.")

On a related note, check-out Bob Buford's book, Halftime: Moving from Success to SignificanceHalftime: Moving from Success to Significance. It is about making the second half of your life better than the first.

Buford reminds that in order to have a better second half, you must first figure-out what you
want.

In Halftime, Buford focuses on 'transition'---the time when, he says, a person moves beyond the first half of the game of life. It's a time of revitalization and for catching a new vision for living the second half, the half where life can be lived at its most rewarding. Halftime doesn't have to be a time of crisis. It can be a catalyst for purpose, impact, and growth. It can be about setting a new course away from mere success to true significance---and something better.

This message applies to the market and our economy as well.  What if we are half-way there?  What do you really want?  Where are you committed to go?  What adjustments are needed?  What do you want to do more of? What do you want to do less of?  What do you need to start doing?

It's half-time, and the best is yet to come.

 

Related articles

• Clint Eastwood: I am not 'politically affiliated with Mr Obama' (thegrio.com)
• 'Halftime in America': Clint Eastwood Hates Car Company Bailouts, but Loves Car Company Commercials (minyanville.com)
• A Better "Halftime In America" Commercial (zerohedge.com)

Some Links to Browse This Weekend

I don't know about you, but the Euro thing doesn't seem "done" to me ...

 

 

Here are some of the posts that caught my eye. Hope you find something interesting.

Lighter Links:

• How Will You Use Your Leap Second? (NYTimes)
• Big Data: Why All the Fuss? (InformationWeek)
• Kurzweil On Prediction Accuracy: Adjusting to Change & Neuroscience. (Wired)
• NASA's 'Impossibly Beautiful' Photo of Earth. An Ultra High-Def Update. (TheWeek)
• Dallas Opera Will Simulcast Its Performance at Cowboys Stadium. The fat-lady really is singing. (WFAA)

 

Trading Links:

• How to Play the Five Big 'What-Ifs' Affecting the Markets. (WSJ)
• How Long Can the Stock Market Forget About the Pain? (NYTimes)
• Spotting Winners Is Not Always Rational. (FT)
• Why 2012 Will Be the Year of the Entrepreneur. (Moneyland)
• Will Collecting State Taxes Slow Amazon Down? (Barrons)

Expect Extraordinary - Here's a Video of Something Not to Try at Home

Sometimes normal isn't enough.

Playing safe is often a good strategy ... But, sometimes you have to expect the extraordinary.

Did you see the strange guy doing a modified tight-rope circus routine during Madonna's Super Bowl half-time performance.

 

 

 

 
Well, it was more than that ... did you see the guy bounce up and down as though that little rope was a trampoline?

What in the world was going on?

Well, the short answer is: slacklining. Or, if you want to get technical and specific, tricklining. According to California's Adventure Sports Journal , slacklining was invented in the early 1980s by two rock climbers.

As you may have guessed, the Super Bowl halftime cameo was a big moment for the young sport of slacklining—and for the talented, curly-haired slackliner who got the spotlight: Andy Lewis, aka Sketchy Andy . You've got to watch what he can really do!

 

 

 

Imagine what went into developing this skill.  Was it thought ... or something you forgot you could exercise?

What are you committed to expecting extraordinary about ... starting now?

Related articles

• Acrobatic Urban Films - The 'Slackline Trickline Video and Project X' is Full of Stunts (TrendHunter.com) (trendhunter.com)
• About Slacklining (neatorama.com)