Stocks go gaga; gold's (foreseen) falling saga

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Stocks go gaga; gold's (foreseen) falling saga

As we on occasion do, let's start with stocks, their prices having gone gaga. And with respect to the S&P 500, the following may be deemed obscene; thus parental discretion is advised as we go to a favoured graphic, courtesy of the "Others Parrot; We Do The Math Dept.

Oooh, and then there the Economic Barometer which as noted a week ago dropped like a stone per its Q4 metrics ... and yet The Bureau of Economic Analysis' initial report of Q4 Gross Domestic Product came in at +2.9%. How does this happen? A gob-smacker, that. Further as we've ad nauseam pointed out, the S&P's riskfull yield of now 1.622% is well less than half the three-month U.S. T-Bill's riskless 4.523% annualized yield. And amongst the S&P 500's heavy-weights are some ridiculous price/earnings ratios: for example Nvidia's 88.6x, Amazon's 92.7x, Berkshire's 308.5x and Salesforce's 613.7x.

Thus: was the Federal Open Market Committee premature in reducing its Bank's Funds Rate increase from +50bp to +25bp? After all, the Bureau of Labor Statistics came up with Non-Farm Payroll creation for January of 517,000, a six-month high and a +99% increase from December, albeit ADP's calculation of only 106,000 jobs was a -58% decrease. But it all depends upon who's counting what ... and perhaps to what end.

As to how low does Gold then go? Again we emphasize the 1800s as being supportive, so don't get overly nervous out there: however for the past 10 parabolic Short trends, the average decline from the flip price is -153 points, which in that vacuum from 1856 suggests 1703. That'd be quite the untoward hit but hopefully avoidable as"Gold Awareness" becomes more hip.

 

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