Author Archives: Rick Pendergraft

Mixed Signals from Manufacturing Index and Employment Report

There have been various entities putting pressure on the Fed to back off on its rate increases in recent months as the stock market has come under pressure. The most vocal critic has been President Trump himself. The president even tweeted on Christmas Eve, “The only problem our economy has is the Fed.” The Fed has stated that they intend ...

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An Interesting Observation About High Short Interest Stocks

I am a creature of habit. At the beginning of each month, I comb through the thousands of stocks in Investor’s Business Daily’s database. I look for stocks that meet three criteria: an EPS rating over 80, an SMR rating of an A, and average daily trading volume of 500K or more. The EPS rating measures how the company has ...

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Market Swoon Takes a Toll on Consumer Confidence

The latest Consumer Confidence report was released on Thursday and it showed a sharp drop in December. The index dropped to 128.1 for the month and that is down from 136.4 in November. The index peaked at 137.9 in October and has ticked down since then. If you are frequent reader of my articles, you know that I view the ...

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Huge Shift to Bonds Could Be a Good Sign for Stocks

Bank of America Merrill Lynch released its monthly Global Fund Manager survey on Tuesday and the results showed a huge shift in asset allocations. The allocation to bonds jumped by 23 percentage points and that is the biggest one-month rotation ever. The survey also showed that the equity allocations dropped by 15 percentage points. Given the way equity markets have ...

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The Landscape has Changed for the Fed’s Rate Path

Over the years I have heard many different sources, from economics professors to Fed Chairmen, say that the Federal Reserve doesn’t pay attention to the stock market when it comes to deciding rate policy. I think we all know better than that. When the Fed stepped in and started lowering rates at the end of 2007, you can bet that ...

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Wall Street has a Trust Issue with President Trump

In poker, when a player has a habit that indicates that they are bluffing or another one that indicates they have a strong hand, it is called a tell. In criminal law when a criminal uses a certain method to commit the same crime over and over, they call it an M.O.—or modus operandi. Right now, Wall Street seems to ...

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