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Fiscal Y/E 2014 US Federal Government Budget


Where do your tax dollars go? Let me count the ways! This is a high level look at the 20% Government Expenditures Category of GDP. It has been fairly consistent over the years, except during recessions when spending increases to 23-24% of GDP. Please remember that in periods of contraction, level government spending automatically goes up on a percentage basis.

The “Hoopla” in Congress during recessionary periods is merely a game of strong wills and misleading information, especially during election years. You can expect the same during this election season, the Mid-Term 2014 election.

image15 292x600 Fiscal Y/E 2014 US Federal Government Budget


I have to admit though that Mandatory Spending (Social Programs) has expanded, while Discretionary Spending has contracted over recent years. See below!

image16 Fiscal Y/E 2014 US Federal Government Budget

Mandatory vs. Discretionary Government Spending

Tweet Peeks at 1Q2014 GDP for Week Ending 04/19/2014


The Best Stock Market Indicator illustrates that the stock market is Un-Tradable. RSI, MACD and STO are all NEGATIVE. http://t.co/NwYLAc6Xk1

World Stock Markets continue to be volatile & a mixed bag. World Average has contracted for the first time in 4 wks. http://t.co/yy95ytaeP2

1Q2014 GDP Forecast is 1.5% based on Wall Street Journal’s Economists Crystal Ball. At least that is the consensus. http://t.co/vOpQSNvk3S

March Advance Retail Sales increases 1.1% over Feb’14, & beats estimate. The trend leading into 2nd Quarter is good! http://t.co/lU5zllzqmk

The US Economy in Pictures! No words needed here. Take a closer look at these charts! Are you prepared for a downturn? http://t.co/CWMab4qTH7

Retail Sales and Industrial Production accelerate in March from the Seasonal lows caused by poor weather conditions. http://t.co/yn41fPwXA0

1Q2014 Stock Performance by Industry http://t.co/L1Ad7Mu4Na

Steve Blumenthal’s CMG Trade Signals clearly show that we can expect a seasonal negative adjustment from May-to-Oct. http://t.co/GiFIc5g3iA

1Q2014 Stock Performance by Industry

image3 300x225 1Q2014 Stock Performance by Industry

Is the 2014 Stock Market Correction Over?

Let’s take a look at stock performance by industry in the 1st Quarter of 2014. Generally, we saw a correction during the 1st half of the quarter, a recovery to index highs, and most recently another correction. It was a volatile quarter overall. I decided to take these pictures as of April 16, 2014 shortly after potential tax moves on T-Day, April 15th.

Since we are not in the business of making any investment recommendations, we are just illustrating stock market performance in graphic form, and do not promote any particular stock or industry at this time. We are leaving that up to the experts, although there is plenty of bias in this environment.

Click on each image to read the percentage gains or losses.


image4 300x146 1Q2014 Stock Performance by Industry

Industry Performance in Utility Sector During 1Q2014


image5 300x159 1Q2014 Stock Performance by Industry

Industry Performance in Electronic Technology Sector During 1Q2014


image6 300x151 1Q2014 Stock Performance by Industry

Stock Performance in Energy Minerals Sector During 1Q2014


image7 300x155 1Q2014 Stock Performance by Industry

Stock Performance in Consumer Non-Durables During 1Q2014


image8 300x153 1Q2014 Stock Performance by Industry

Stock Performance in Communications Sector a During 1Q2014


image9 300x141 1Q2014 Stock Performance by Industry

Stock Performance in Health Services Sector During 1Q2014


image10 300x159 1Q2014 Stock Performance by Industry

Stock Performance in a Consumer Durables Sector for 1Q2014


image11 300x150 1Q2014 Stock Performance by Industry

Stock Performance in Finance Sector During 1Q2014


image12 300x150 1Q2014 Stock Performance by Industry

Stock Performance in a Commercial a Services Sector During 1Q2014


image13 300x151 1Q2014 Stock Performance by Industry

Stock Performance in Retail Trade Sector During 1Q2014


image14 300x150 1Q2014 Stock Performance by Industry

Stock Performance in Technology Services Sector During 1Q2014


Tweet Peeks at 1Q2014 GDP for Week Ending 04-11-2014


We are close to calling the current cycle a Secular Bull since the low in Mar’2009. It needs to break Year 2000 high. http://t.co/YZ8BqgQ1d4

ADP Jobs Report shows 191k net jobs created in Feb’2014. This was consistent with consensus. .weather effect negated? http://t.co/5VUiSd9W5i

The drama continues in the stock markets, stopping the 3-day sell off in its tracks. Will we see a 10% correction? http://t.co/wbADcJADgY

Philly Fed’s Leading Index falls again, but still above 1% indicating no recession in sight for at least 6 months. http://t.co/rP00xFhnaL

Big 4 Leading Economic Index has reversed its negative trend. Will the current Business Cycle continue its growth? http://t.co/DcG32iqcyM

Labor Force Participation Rate is still contracting for those Aged 25 to 64. Growth in jobs is for Age 65 & older. http://t.co/GqLJe9MxV7

Stock market sell-off continues. Interested to see whether yesterday’s 10% drop in jobless claims will prompt buying. http://t.co/YkubUa1p1P

New Jobless Claims plunged 10%, which was more than expected. Will the unemployment rate restart its trend down? http://t.co/DjhFrxeSqv

Vrba’s forecast to the next recession is now 40 months out! It’s unlikely the US Economy can sustain growth 3+ years. http://t.co/J3eaHbWNTn

Stock Market Correction or Crash!

image1 300x225 Stock Market Correction or Crash!

The US Economy and Its Good Ride on the Bull

Unknown to many, April marks the seasonal point for falling stock market prices. Where this date comes from, I do not know, but what I do know is this . . . The stock market is overvalued. Look at this chart for illustration of the current bull run.

CrestmontResearch.com is a great resource for stock market analysis. There are many sites that provide the same type of graphs, but their analytics are second to none.

If you want to learn about macroeconomic trend analysis, then this site is a great resource for education about P/E ratios, the Stock Market, Interest Rates, Secular Bull & Bear Markets and the overall economy. Now, let’s get back to the stock market trends.

We have been in a Secular Bear market for 14 years. The average time in either market is about 18 years with a few exceptions since World War II. The question is when will the current Secular Bear end, or has it already ended?

Based on recent history, the current cycle could go on another 4 years. Since we are near the top of the current business cycle and P/E values are historically high, I expect the current stock market correction will continue through the seasonal adjustment period. The following is Doug Short’s analysis of the current week’s S&P 500 performance:

image3 300x218 Stock Market Correction or Crash!

S&P500 Percent Off High Since March 2009

We are sitting at just under a 3% correction over the last week and 4% off the March 2009 high. Will the stock markets rebound and resume growth, or will we slide into a double digit correction? Only time will tell, but it will be sooner than the “Bulls” think. The only good thing in my mind is that economic indicators appear to be turning more positive than negative after the Weather-Effect slowdown in the 1Q2014.

Both Consumer Sentiment and Small Business Optimism increased in the latest polls. Employment, Personal Income and the Labor Participation Rate notched up a bit in March. And, Manufacturing activity continues on its slow growth trend.

Residential Construction Starts and Residential Sales for March come out over the next 2 weeks. I expect a rebound over the February numbers. Will it be enough to fend off a double-digit correction? Unfortunately, it appears that the stars and moon are in line for a continued downturn.

A Total Lunar Eclipse will occur on April 15, 2014, the deadline for filing US individual tax returns. For some, a Blood Red Moon means the beginning of the end. For others, like me, it means people doing unusual and irrational things during a full moon.

I believe the stock market correction will continue its downward trend this week, but for a different reason . . . Institutional Investors are just taking some of their profits out of the market for later investment. Let’s hope that the influence of the moon and stars do not create negative and emotional world events that may impact stock market this week.

All I know for sure is that it is time for a major correction, but not a crash. However, there is a lot of hedging moves going on at this time. Of course, now is the time to protect or take some profits. Unfortunately, the crowd is fickle and may eventually prove me wrong. So be it!


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