The Market Perspective

6/19/2025

I thought the President had important things to do.

I guess not. 

This is not a political weblog. But the poll reflects growing negative mood by the public. Trump is surely the most thin skinned President of modern times finding time to argue with anything negative bout him or with Bruce Springstein. Today he is agreeing not to deport farm workers. The on and off again approach to everything makes planning difficult, hence doubts on the economy. 

 

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Donald Trump slammed a Fox News poll Thursday on Truth Social, accusing the network’s pollsters of being “always wrong and negative.”

“The Crooked FoxNews Polls got the Election WRONG, I won by much more than they said I would, and have been biased against me for years,” Trump wrote, referring to the 2020 election, which Fox correctly said that he lost. “It’s why MAGA HATES FoxNews, even though their anchors are GREAT.”

“I hate FAKE pollsters, one of the Worst, but Fox will never change their discredited pollster!” he added.

A Fox News poll released Wednesday shows that a majority of voters disapprove of Trump’s job performance by an eight-point margin. The poll, regarded as one of the best in the industry, found that a majority of voters are still feeling pessimistic about the state of the economy. 

 

Wave Two U[date

6/16/2025

While the SPX made a new high only 2% of the stocks in that index have made a new high, the reason is the over weight of tech stocks. 

Frankly there is not much else to say until this back and forth between bulls and bears is resolved.

In my post Friday I said we need more evidence the top is in, that analysis is unchanged. 

Ditto for bonds though I do not see how the FED can lower rates with oil over $70.

And see previous posts on social mood, it is only getting worse. 

Click here for a typical critical of the Trump parade.

And they are right  he never served but wants the Army now to make him look good.

The bigger point is that social mood is fragmenting and falling apart. 

 

 

Crude Vaults Over $70

6/13/2025

Crude Oil Vaults over $70

Early Friday morning, local time, Israel launched dozens of strikes against Iran and declared a state of emergency, according to Defense Minister Israel Katz.

ABC News Today

Crude oil has advanced to $64.59. This is just a few cents shy of resistance at $65. Clearing $65 gives a next target of $70.

This column last Friday

As I write this Friday morning 6/13/2025, crude oil has jumped about $5, last quote $72.67. As noted last week the chart was already in bullish formation. The event of an Iran attack was the fundamental event that verified the chart pattern. Gold by is up another $56 today to a new high of $3,459.  

Here is some historical perspective. In the last 1970s gold and crude oil were soaring Crude went from $10 in 1979 to its final high of $36 in 1981. Recall that maximum social mood occurs at the end of a pattern.  Those two markets back then were a good example.  The fear of missing out FOMO had ‘investors’ piling into gold an oil. However, the logic behind rapid rises in both markes is never good. Numerous adds for gold remind us that the dollar has lost 95 its value since, well pick a date. Then, 1979, crude was rising because of a second oil embargo.  Now it is rising because of war. Notice this is   not just the threat of war but a war between Israel and Iran. One can date this back to the Hamas attack on October 7, 2023. 

This was not good news for the stock market, The Industrials reached 1,000 for the first time ever in 1966. The index pulled back (TET offensive, US riots) and then reached 1,000+ again in 1972, It then tumbled from 1,040 to 577 from 19793 to 1974. By 1982 it was only trading at 800.

This column has suggested topping action in the indexes for some time.  Today the Industrials are down 534 points.  On my www.themarketperspective .com blog I suggested the earlier declines this week would need more drop to suggest a top to the rally from April 7. The news will cite the Mid East events as a reason and a normal pull back from the rally. The indexes gapped down on the open today. We will need more decline to confirm a top.  I expect we wil get it. We have riots unfolding amid political animus here. Wars occur in the Ukraine and Iran and Gaza. Did anyone notice the riots it Ireland?

One market that is not conforming to history are bond prices. Rises in gold and oil should depress bond prices. I suspect this is the belief that Powell  will succumb to pressure and drop interest rates. He should not do so in light of the events occurring now.

Scanning the News

5/26/2025

We are seeing the top of Wave Two and the news reflects that.

Southern California experiences the reality of Trump tariffs. A driver with a rented truck was delivering two containters a day. Now two containers a week. He says he can't do this much longer. Nick's Pizza near the docks reports business is down 15%.

Biden tried every trick to buy votes with students burdened by college debt. He managed to create the idea they would not have to pay, loan forogiveness. Now Trump is demanding payment. Money that might have gone to purchase goods and services now goes to debt, another dent in the economy.

King Charles visits Canada and opens Parliament for the first time since his Mother did 68 years ago.  Trump has irked Canadians with his 51st state talk. Travel from Canada to the US is down 15%.  So less Canadian money is being spent in the US.

The UA Government reliably attacks the most successful companies at market tops. RCA in 1929, IBM 1966, MSFT 2000 and now Apple. Trump wants the Apple phones made here. Trump is clearly out of his league in manufacturing. There is not the time to make the switch and the cost of  a phone would be  many times the current price. As always becoming friends with Trump eventually wears badly.

Chinese BYD slashes prices on electric cars.  Ford and GM cut back on EV production.

Putin senses no country really wants to challenge him on the ground in Ukraine. The war drags on.

These are just a few of unintended consequences of the not thought out tariff policies. And it comes right on time as Wave Three down begins.

Travel Hits a Brick Wall

5/25/2025

htTrave Hits a Brick Wall

Incredible Dance Scene

5/21/2025

Elanor Powell and Buddy Rich

Jamie Dimon on Complacency

Monday 5/19/2025

JPMorgan Chase (JPM) CEO Jamie Dimon warned that he sees an "extraordinary amount of complacency" in markets after investors clawed back their "Liberation Day" losses, emphasizing that the risks of higher inflation and even stagflation are still higher than people think.

"The market came down 10%, back up 10%," he said. "I think that's an extraordinary amount of complacency."

Optimism Abounds

5/15/2025

Optimism Abounds

The Roaring 20s stock market provided derivative support to real estate and automobiles.  The Auburn Cord Dueseneberg company would finally close its doors during the following Depression. Duesenberg became part of the lexicon with the phrase, she’s a duesy. It meant the object or project was really something special.

The same thing is happening now.  There are now four stand-alone Ferrari dealerships in Texas. Not to be outdone, Lamborghini has also opened stand-alones in the same four cities, Houston, Dallas, Austin, and yes San Antonio.  I mention stand alone as historically one just cold not sell enough $250K+ automobiles to make a go of it alone. But no longer apparently.

Shoppers ae bidding up Gulf Coast Properties. Some of the most expensive properties ever  now exist on the Miami Beach waterfront. However, there are now more homes for sale in San Antonio than at anytime dating back to 1990. And this includes many for over one million dollars.

Near the peak of the dot.com boom the stars of Seinfeld wanted GE stocks rather than more cash pay. They got what they wanted but GE has never seen those high prices since, and has been taken out of the Dow Industrial index.

The desire for stock is back, from Washington DC no less.  Senator Ted Cruz proposes that every child in America get $1,000 at birth to invest in the Stock Market. In a fine irony this is part of the ‘tax cut plan.’ The last minute proposal would cost billions a year.

Trump’s tariffs are finally having an effect rumored all my life. In elementary school I recall The Weekly Reader publication continually predicting that Brazil would be the country of the future. It never happened, until now. Realizing the loss of US soybeans, China’s Cofco Agriculture conglomerate is building the biggest export terminal ever outside China. It will triple the size of the Santos port. China has a 90% stake in the southern port of Paranagua. China Railway is building needed track from farmland to the coast. Cosco Shipping has built a deep water port in Peru for better trade between Asia and South America.  Careful what you ask for Donald.

The Magnificent Seven stocks are back accounting for 48% of the NASD and 28% of the SPX, which is how both have recovered this year’s loss.  Fixating on a handful of stocks is a signature event at market highs.

Keep an eye on the bond market, The thirty-year Treasury now looks to exceed the 5.2% high yield recorded last year. T Bill rates are back to 4.3% far exceeding the SPX dividend yield around 1.5%. The post April 7 rally has re-kindled bull market expectations. Don’t be so sure about that.

Best Horror Movies to Watch on Netflix in April

4/29/2025

Horror movies are a negative mood dynamic.

The fact that Polygon a games site would mention three is a sign of where social mood is headed.

The original horror movies began in the negative mood of the 1930s Depression. Frankenstein, Dracula, and the Wolf Man reflected the desire to be scare amid the scary events of that day.

This was repeated in the economic meltdown of the first oil  embargo in 1972-3 with the Exorcist and gangster movies like Godfather. Gangster movies were also popular in the 1930s with titles like Public Enemy.

 

The bear market is just getting under way.

Consumer confidence lowest since 2011.

One Year of Advance Gone in 2.5 Months

Monday 4/21/2025

 

Stocks fall seven times as fast as they rise. This is how so much capital has evaporated in such a short period of time.

I mentioned recently that to the cycle of hope, fear, and greed which is said to drive stock markets, let's add complacency.

the investing columns in the WSJ have been full of it.

Remember why you bought it

Be a long term investor

Don't look at your quotes every day.

You can't make money jumping in and out of the market.  (But you can save what you have made!)

The cable business channels are supported by mutual funds, advisory services, big banks, etc. They will never tell you to take your profits and retreat to safety. How wold they explain that to their underwriting clients?

I wonder when complacency turns to hope and then fear. Well it has happened to some investors or we would not be down 1,000 points in three hours today.

SPX looks the same

NDX looks the same as well, though it is falling faster, down 2.98% today.

All of this lines up with 1973-74. The market topped that January and then began a decline.  The President had handily won the election but the press hated Nixon as they do Trump. Inflation was alive and well, here we will have inflation due to tariffs, just now a warning about pests in CA avocadoes from Mexico.

Be sure to read my 4/16/25 short courses in currencies post on this blog. There was another article in the WSJ tday along with the market watch article I posted 4/16. Usually in a market sell off, bonds and the dollar rally. That is not the case here.

The  30 year T Bond is down a full point again today.

And the dollar index is down a full point.

 

June gold however is up $100 just today.

All of this has the makings of a great financial movie plot

the movie  Rollover in 1981 at the height of the oil crisis, inflation crisis, was along these lines. The title came from whether the Arabs would rollover or renew

their investment in US T bonds, CDs or whatever, if they didn't how would we finance our government?

 

At any rate I was showing my class the history of modern currencies since the Bretton Woods agreement of  1944, see 4/16 post. And then read the Nixon shock, no more gold convertibility, and now a new game in town the Asia Infrastructure Investment Bank.

 

All of this has the making of trouble ahead. At what point do investors lose complacency and really start selling?  If you have followed our advice you are out of stocks and in the safety of T bills which should begin a rising yield as well.

More later today.