Wednesday Night #1874 with Peter Berezin

Written by  //  February 7, 2018  //  Wednesday Nights  //  No comments

Last Wednesday, Ron Meisels treated us to an optimistic forecast “We continue to expect that a pullback in this overbought market will occur – certainly by the end of Q1, as Part 4 of Leg-5 , adding “ this will then be followed by more new all-time highs later this year, during the last and final move of the current bull market” and  “Longer-term the New York bull market remains healthy. There are no signs of internal erosion or deterioration that normally appear as a bull market approaches its end.”  But he did not indicate that the pullback might be quite so imminent!

Since Friday’s startling market slide, almost every commentator we have seen or read has reminded us that “the stock market is not the economy.”

Has the latter influenced the former’s giddy performance?
Paul Krugman says “ the market plunge of the past few days might mean nothing at all. On one side, don’t assume that there was a good reason for the slide” – he could not resist this parenthetical dig (“although the fact that the Dow fell 666 points on Friday hints either at satanic forces or at some mystical link with the Kushner family’s bum investment at 666 Fifth Avenue”). … And on the other side, don’t assume that the stock price decline tells us much about the economic future, either.”

In her interview last Friday aired on PBS Newshour, Janet Yellen stated “I feel great about the economy. I think things are looking very strong. The economy’s growing at a healthy, solid pace.” Ant on Wednesday morning, Reuters reports The 4.5 percent drop in the benchmark S&P 500 over the last five days has not dented strategists’ expectations for mild to moderate gains in the U.S. stock market by the end of the year, with corporate earnings and interest rates not expected to derail equities.

Donald Trump has trumpeted (sorry!) the rise in the market as a reflection of his policies. Now he is (perhaps) learning a tough lesson: “if you claim the rise, you own the fall.”
By Tuesday evening, the market was settling down, but many pundits/experts expect more volatility in the future.

Some of our Wednesday Nighters have for many years talked about ‘sentiment’ with respect to markets. We have a question. With more and more ‘programmed trading’ e.g. by machines following algorithms, will ‘sentiment become  a thing of the past?   A down day on the markets? Analysts say blame the machines

We are particularly pleased that Peter Berezin is with us this Wednesday to share his views on long-range outlooks. On February 2, the BCA Global Investment Strategy Report, titled  Take Out Some Insurance, stated that “stocks are vulnerable to a near-term correction and that long-term returns are likely to be lackluster at best. As such, it is sensible to take out some insurance against a market selloff.”

If puzzling over markets and the economy is not a sufficient challenge, you might want to have a look at the Quartz Obsession story on The Voynich manuscript  described as “no mere book—it’s a cash cow of the attention economy.”

Poland is in the news for all the wrong reasons: the recent draft law outlawing accusations of Polish participation in the Holocaust and other war crimes that took place during the German occupation of Poland. The NYT op-ed Poland Digs Itself a Memory Hole by Marci Shore . associate professor of history at Yale, is a chilling account of the Kaczynski government’s program to repress freedoms and to re-write Polish history.

Turkey’s deteriorating relations with the U.S., recently compounded by  reports that the US would form a new border force in Syria comprising mainly Kurdish fighters which resulted in Turkey’s  assault on the YPG in Afrin is of deep concern although other global events may be receiving more attention at present.  Therefore, we welcome the timely presentation on March 6th  by CIC Montreal   Turkey Today and Tomorrow”: A talk by Dr Chris Kilford addressing the challenges facing this major regional power and NATO ally and what the future may hold 

What’s in a name? Quite a lot if the name is holding  up your country’s  prospects of joining the European Union and NATO. Macedonia may not have been  a top-of-your-list preoccupation recently, but Ken Matziorinis will join us and tell us what is behind the mass protest in Athens and why it is important.

On the eve of the opening of the 2018 Olympics, Mike Pence aka Banquo’s ghost is headed to South Korea, apparently  bringing the father of American student Otto Warmbier, who was jailed and tortured by the North Korean regime, and later died from his injuries after returning to the US. One of the more obscene props we have heard of, and fully in line with Trump’s use of human props for SOTUS. Not sure this will impress Kim Jong Un’s 28-year-old sister or the other members of North Korea’s official delegation.

Excellent news from the successful launch of Elon Musk’s Giant Rocket . SpaceX’s 27-engine Falcon Heavy successfully blasted off from Florida with a cherry-red Tesla convertible in tow. Latest reports indicate that the car overshot Mars’ orbit and is headed to the asteroid belt.

In Canada, the spat between Alberta and BC over the Kinder Morgan pipeline calls for judicious handling by Ottawa. We were not impressed by the Prime Minister’s statement in Nanaimo that climate change and spill protection programs won’t go ahead unless the Kinder Morgan pipeline expansion is built. NOT helpful – these are not quid pro quos.  With Caroline Mulroney’s entry into the Ontario PC Leadership race, it becomes even more interesting, but a Leader with no political experience?  The bloom is wearing off the Plante administration awfully quickly.  Certainly the proposal  [Motorists will no longer be able to cross Mount Royal starting in spring, city says ] to block Camillen-Houde to through traffic should bring on some serious blight! But it is still at the proposal stage and reaction from Les amis de la montagne was swift “the plan could create more problems than it solves.” Precisely.
You may be interested in the Feb 22-23  2018 Annual Conference of the McGill Institute for the Study of Canada  WHO PAYS FOR CANADA? TAXES & FAIRNESS  with a number of familiar names on the program, including Anne Lagacé Dowson.

As we listened to the familiar sounds beneath our windows of heavy equipment clearing the snow, our hearts went out to les parisiens coping with temperatures as low as minus 10C (14F) – pretty spring-like in Montreal – and an expected snowfall of  5-10cm (two to four inches)   Sacré blanc! Eiffel Tower closes as snow blankets Paris and northern France Not so funny, the more than 700km (430 miles) of traffic jams.

You may note the paucity of references to the occupant of the White House, or in fact, any of the current Washington shenanigans – we simply cannot keep up with the war of the memos; the battle over government shutdown or the number of personalities masquerading as pots and kettles! When/if there is any resolution to the DACA or to renewal of the nation’s Infrastructure, we will resurface (actually, probably before), but for now – we need a rest.

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