Wednesday, February 3, 2021

The Morning Call--Valuations at historic highs.


The Morning Call




The Market




            Tuesday in the charts.



            Is a larger correction coming?



            Bottom line.  Market technicals remain the immediate story.  The Reddit crowd took a licking yesterday as their ‘most shorted’ targets declined substantially and their newest mark, silver, could not sustain their initially onslaught.  I said yesterday that this whole Reddit phenomena may be over and the pin action would support that judgment.  However, I think it is too early to write it off.  Stay watchful---I would not get sucked into yesterday’s Market bounce back.   


            Yellen gets ethics waiver to lead investigation of the Reddit phenomena.







              The Economy




Weekly mortgage applications were up 8.1%, purchase applications up 0.1.


The January ADP private payrolls report showed job increases of 174,000 versus predictions of 49,000.





The January Japanese services PMI came in at 46.1 versus estimates of 45.7; the Chinese Caixin services PMI was 52.0 (no forecast provided); the German services PMI was 46.7 versus 46.8; the EU services PMI was 45.4 versus 45.0; the UK services PMI was 39.5 versus 38.8.


The January Japanese composite PMI was 47.1 versus consensus of 56.7; the Chinese composite PMI was 52.2 (no forecast provided); the German composite PMI was 50.8, in line; the EU composite PMI was 45.4 versus 45.0; the UK composite PMI was 41.2 versus 40.6.


The January EU CPI was reported at 0.2% (no estimate provided); PPI was 0.8% versus 0.7%.




              December median household income.



              Regional Fed manufacturing indices overview.



              Bankruptcies declined 29.7% in 2020.



              Framing lumber prices doubled YoY.



Fiscal Policy


  The argument in favor of Biden’s $1.9 trillion stimulus plan.


  The fiscal dilemma keeps getting worse.


Bottom line.  Valuations exceed highs.



  An interview with Howard Marks.


    News on Stocks in Our Portfolios


Emerson Electric (NYSE:EMR) declares $0.505/share quarterly dividend, in line with previous.


What I am reading today


            The benefits of an open society.



            The loss of organizational IQ.



            Quote of the day.

            Quotation of the Day... - Cafe Hayek


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