Subject: stock chart
From: "Adam Downs ex:116" <[email-masked]>
To: <[email-masked]>, <[email-masked]>, <[email-masked]>
Date: Tue, 25 Mar 2014 08:48:26 -0400

What is surprising is how strong the market is compared to the previous
bull market.

Stocks continue to follow bull market script

By: Ed Yardeni 

Published: March 24, 2014

 

Earlier this year, the bears noted that the Dow Jones industrial average
might be following the 1928-1930 Great Crash script. Fortunately, it
hasn't played out that way so far. Now the bears are focusing on
1938-1939, when Hitler invaded Austria, Czechoslovakia and Poland.

The concern is that current geopolitical developments are eerily
reminiscent of that period. I noted a week ago that in October 1938,
Hitler marched unopposed into Sudetenland a month after Britain and
France gave him this territory that was part of Czechoslovakia. The
Sudeten Nazi Party had set the stage for this annexation by instigating
strikes and riots, which were shown in German newsreels as evidence of
Czech atrocities against German-speaking Sudetens. Hitler threatened war
unless he was appeased, which he was at the infamous meeting in Munich.
Putin seems to be following the same script in the Ukraine.

Nevertheless, the S&P 500 rose to a new intraday record high of 1,883 on
Friday before closing at 1,866. It managed to gain 1.4% for the week,
following the previous week's 2% decline. That's despite last
Wednesday's 0.6% decline in response to Fed Chairwoman Janet Yellen's
off-the-cuff statement that the Fed might start raising interest rates
six months after QE is terminated probably by the end of the year. That
would mean that rates will start rising around mid-2015.

Stocks rebounded 0.6% the next day, Thursday, as investors realized that
Ms. Yellen's forward guidance depends on inflation rising back to 2% and
the unemployment rate falling probably closer to 5.5%. That might take
longer to happen than mid-2015. In any event, the Fed's latest "dot
plot" showed that in the latest economic projections of the FOMC's
participants, the federal funds rate is expected to be just 1% at the
end of 2015, hardly an impediment to higher stock prices.

So far, the stock market is continuing to follow a bull market script
similar to the bull markets that started in 1982 and in 1990. That's
mostly because forward earnings for the S&P 500/400/600 continue to rise
to record highs.

Source: Ed Yardeni
<http://blog.yardeni.com/2014/03/stocks-continue-to-follow-bull-market.h
tml>  - Ed Yardeni is the president and chief investment strategist of
Yardeni Research Inc., a provider of independent investment strategy and
economics research for institutional investors.

Original Story Link: 
http://www.pionline.com/article/20140324/INTERACTIVE/140329966/stocks-co
ntinue-to-follow-bull-market-script
<http://www.pionline.com/article/20140324/INTERACTIVE/140329966/stocks-c
ontinue-to-follow-bull-market-script> 

 

Adam M. Downs

Fund Administrator

Laborers' National Pension & Retirement Funds

5th Floor

905 16th Street NW

Washington, D.C. 20006-1765

Telephone:  202-737-1664

Cell:  301-332-4569

E-mail:  [email-masked]

 

 

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