Peter Dag & Friends: June 2016

6/27/16

We are in a recession

Make no mistake about it. We are in a recession according to the above important measure - capital investment in new capacity and machinery. (Shaded areas indicate recessions).

Without capital investment the economy cannot grow. It stagnates and contracts. See the above chart.

Business is confused by the class war (people vs. bureaucracy) around the world. They are being careful about how they spend their money.

This is the reason that when capex declines for so many months the economy is in a recession and more often than not you have a bear market in stocks and a strong bond market.

Investment implications are discussed in depth in each issue of The Peter Dag Portfolio.

You will encourage my timely update of this blog on the economy and financial markets by entering a subscription to The Peter Dag Portfolio.

Thank you for visiting this site.

George Dagnino, PhD

Editor, The Peter Dag Portfolio

Since 1977

Author, Profiting in Bull and Bear Markets

Disclaimer. The content on this site is provided as general information only and should not be taken as investment advice nor is it a recommendation to buy or sell any financial instrument. Actions you undertake as a consequence of any analysis, opinion or advertisement on this site are your sole responsibility.

Buy my new book now

EASY WAYS TO BEAT THE MARKET WITH ETFs .

6/26/16

Bonds and bear markets

Yields are collapsing (see above chart) and bond prices are soaring while the market sags.

I have discussed in detail how bonds are a very important asset class to protect your portfolio when the stock market declines sharply.

You may want to subscribe to my The Peter Dag Portfolio where I discuss in details how to use bonds very effectively during bear markets.

You could also reviews the many videos discussing the market (they are free) shown on my website www.peterdag.com.

Investment implications are discussed in depth in each issue of The Peter Dag Portfolio.

You will encourage my timely update of this blog on the economy and financial markets by entering a subscription to The Peter Dag Portfolio.

Thank you for visiting this site.

George Dagnino, PhD

Editor, The Peter Dag Portfolio

Since 1977

Author, Profiting in Bull and Bear Markets

Buy my new book now

EASY WAYS TO BEAT THE MARKET WITH ETFs .

6/15/16

Profits - reversion to the mean

Profits as % of GDP will have to decline much more from current levels - to a historical mean.

This is definitely going to be a very bearish development for some asset classes.

Also note that every major decline in profits as % of GDP was followed by a recession (shaded area).

Investment implications are discussed in depth in each issue of The Peter Dag Portfolio.

You will encourage my timely update of this blog on the economy and financial markets by entering a subscription to The Peter Dag Portfolio.

Thank you for visiting this site.

George Dagnino, PhD

Editor, The Peter Dag Portfolio

Since 1977

Author, Profiting in Bull and Bear Markets

Buy my new book

EASY WAYS TO BEAT THE MARKET WITH ETFs .

6/13/16

You need to be a market timer to survive

The above chart shows a very important relationship that you need to ponder and understand well. The source is the brilliant Lance Roberts.

Why is it important? Because it simply says that at the current market valuation (PE level) the annual return from equities will close to zero percent in the next 20 years.

What to do? Should you panic? No. The above relationship says that you need to acquire a new set of skills to face the market in the next 20 years.

The market will be volatile. It will go up a lot and down a lot. But, on balance it will show no returns.

Yes, you have to develop the set of tools to tell you the likely direction of the market over the next several months.

Anticipating this investment climate I just published a book that might help you in this endeavor: EASY WAYS TO BEAT THE MARKET WITH ETFs.

Investment implications are discussed in depth in each issue of The Peter Dag Portfolio.

You will encourage my timely update of this blog on the economy and financial markets by entering a subscription to The Peter Dag Portfolio.

Thank you for visiting this site.

George Dagnino, PhD

Editor, The Peter Dag Portfolio

Since 1977

Author, Profiting in Bull and Bear Markets

Buy my new book
EASY WAYS TO BEAT THE MARKET WITH ETFs .

6/12/16

Retail sales point to a weaker economy

Even the wealthy are more careful about how they spend their money. This is bad news for the economy.

Of course, a weak economy is bullish for bonds and bearish for commodities.

Which stocks perform well in this type of environment? Please read my new book now.

Investment implications are discussed in depth in each issue of The Peter Dag Portfolio.

You will encourage my timely update of this blog on the economy and financial markets by entering a subscription to The Peter Dag Portfolio.

Thank you for visiting this site.

George Dagnino, PhD

Editor, The Peter Dag Portfolio

Since 1977

Author, Profiting in Bull and Bear Markets

Buy my new book
EASY WAYS TO BEAT THE MARKET WITH ETFs .

Housing market growing more slowly

The housing market is in trouble according to the above trends.

It should come as no surprise to see the price of building materials heading south.

The business cycle is alive and well.

Investment implications are discussed in depth in each issue of The Peter Dag Portfolio.

You will encourage my timely update of this blog on the economy and financial markets by entering a subscription to The Peter Dag Portfolio.

Thank you for visiting this site.

George Dagnino, PhD

Editor, The Peter Dag Portfolio

Since 1977

Author, Profiting in Bull and Bear Markets

Buy my new book
EASY WAYS TO BEAT THE MARKET WITH ETFs .

6/1/16

A scary trend

This chart shows some scary trends. The levels of smart money sales in 2007 and now look very similar (Source: ZeroHedge).

Investment implications are discussed in depth in each issue of The Peter Dag Portfolio.

You will encourage my timely update of this blog on the economy and financial markets by entering a subscription to The Peter Dag Portfolio.

Thank you for visiting this site.

George Dagnino, PhD

Editor, The Peter Dag Portfolio

Since 1977

Author, Profiting in Bull and Bear Markets

Buy my new book
EASY WAYS TO BEAT THE MARKET WITH ETFs .