As expected, the 20 day moving average of the change in the growth rate of S&P 500 stock prices topped and fell back toward the level where the year over year change in the growth rate of the S&P 500's dividends per share expected for the first quarter of 2014 would have them. Mind the notes in the margin of our chart below and note the differences from the previous version....)
What was different about the past week was a new outbreak of noise in the market, mainly concerned with the future of the Federal Reserve's current quantitative easing programs, which exerted a negative influence that pulled stock prices lower during the week. Here, we can expect a reaction following the Fed's two day meeting this week, with the direction and magnitude of the response dependent upon how convinced serious investors are of the Fed's intentions for sustaining the program.
We'll recommend two posts by Scott Sumner for discussions of why that response matters so much:
To which we'll also point to our own analysis of how the U.S. economy performed in the first quarter of this year:
Like it or not, that's the world investors and the Fed live in now. If it helps, think of today's professional traders who are so distressed over the slightest possibility that the QE punch bowl may be taken away at some distant point in the future as a bunch of pansies that need frequent watering so their confidence can grow....
Welcome to the blogosphere's toolchest! Here, unlike other blogs dedicated to analyzing current events, we create easy-to-use, simple tools to do the math related to them so you can get in on the action too! If you would like to learn more about these tools, or if you would like to contribute ideas to develop for this blog, please e-mail us at:
ironman at politicalcalculations.com
Thanks in advance!
This site is primarily powered by:
CSS Validation
RSS Site Feed
JavaScript
The tools on this site are built using JavaScript. If you would like to learn more, one of the best free resources on the web is available at W3Schools.com.
Other Cool Resources
Blog Roll
Materials on this website are published by Political Calculations to provide visitors with free information and insights regarding the incentives created by the laws and policies described. However, this website is not designed for the purpose of providing legal, medical or financial advice to individuals. Visitors should not rely upon information on this website as a substitute for personal legal, medical or financial advice. While we make every effort to provide accurate website information, laws can change and inaccuracies happen despite our best efforts. If you have an individual problem, you should seek advice from a licensed professional in your state, i.e., by a competent authority with specialized knowledge who can apply it to the particular circumstances of your case.
