July 1929

Is this the July 1929 Stock Market?

We just can’t get 1929 out of our minds. I say we because I know that are a few others out there who are still haunted by the crash that led to the Great Depression and World War II.

Why? I think, for one reason, the crash seemed to appear out of no where and became devastating.  And although the “Great Recession” of 2007-2009 was very bad, it did not lead to the devastation of post-1929.

I believe the Great Recession was the first shot across the bow.  And to fight it, the major central banks of the world did the only thing they knew how and that was to flood the world with cash to prevent deflation.  

So here we are, 8 years and 4 months from the low in March 2009.  And where do we find ourselves? July 1929.  Continue reading

China Still Matters

China Still Matters, so What are the Charts Telling Us?

The Chinese economy hasn’t been in the news very much lately. And maybe that’s because their economy seems to be chugging right along. As the world’s 2nd largest economy it is a major influence on global markets. China still matters, and matters a lot. 

Three economic reports were released last night. Retail Sales was expected to be up 10.6% year over year and was actually reported as 10.7%. This performance is right in the range of the last 2 years but below 2013 and 2014.

Industrial Production was expected at 6.3% year over year and reported as 6.5%.  This level was higher than most of 2016, so showing stability but well below the 2013 and 2014 levels. 

The last report released was Fixed Asset Investment which was expected at 8.9% year over year but reported as 8.6%. This was the weakest growth in year over year since last December.  So two of three key reports were on track.

The Chinese economy appears to be holding steady but China stock markets seem to be giving a little different picture.  In today’s video I look at what the charts of the Shanghai Composite and Shenzhen Composite are telling us.  Continue reading

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