Green Book May 1997
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Featured Articles
1997 Volatility: Indicating a Major Stock Market Transition
Market volatility 1997 to date well above 1992-1995 levels and also above median levels 1957 to present...characteristic of transition years and bear markets.
Bond Market Summary
Economic expansion long in the tooth...Fed working to slow down the economy...Inflation cool...U.S. rates very competitive with foreign yields...strong dollar should continue to stimulate foreign bond buying.
Earnings Up/Down Ratio: Momentum Remains Healthy
Big cap earnings momentum is best and seems to be reaccelerating. Small cap earnings lagging by a bigger margin.
Equity Fund Flows…Short Term
Mutual fund investors less enthusiastic as they learn stock market is not a one way street. Mutual fund investor speculation monitor remains at low levels.
Getting Back Together On The Upside
Impressive rally did not alter Negative status of Major Trend Index. S&P 500 beat 90% of sectors in April. Earnings holding up well in Q1, but margins likely to shrink as the year progresses.
Index Fund Update
Index fund assets approaching $78 billion, 6% of U.S. focus fund assets... Year to date, index fund flows now account for about 14% of domestic total.
Joke of the Month
We received a number of good jokes this month, but considering this issue’s religious humor theme, it was decided that a joke from Weeden’s Peter DeOteris should be anointed the May winner.
Risk/Reward Stock Substitutes
Bonds as attractive Risk/Reward substitutes...disguise them with fictional names such as Bondo Ltd., etc.
Scanning the Markets
Narrowness in the stock market was very evident in April, as the DJIA’s 6.3% gain was better than 70 of the 78 sectors we track (90%).
View from the North Country
Human behavior demonstrates that individuals as a group are risk averse…studies of investor behavior have yielded some interesting findings. Also, Japanese low interest rates in themselves have not yet converted caution and pessimism into confidence and optimism.
Table of Contents
Stock Market
- Getting Back Together On The Upside
- 1997 Volatility: Indicating a Major Stock Market Transition
- Index Fund Update
- Equity Fund Flows…Short Term
- Risk/Reward Stock Substitutes
- View from the North Country
Of Special Interest
Macro Monitor
Equity Strategies
At Random
1997 Volatility: Indicating a Major Stock Market Transition
Market volatility 1997 to date well above 1992-1995 levels and also above median levels 1957 to present...characteristic of transition years and bear markets.
Bond Market Summary
Economic expansion long in the tooth...Fed working to slow down the economy...Inflation cool...U.S. rates very competitive with foreign yields...strong dollar should continue to stimulate foreign bond buying.
Earnings Up/Down Ratio: Momentum Remains Healthy
Big cap earnings momentum is best and seems to be reaccelerating. Small cap earnings lagging by a bigger margin.
Equity Fund Flows…Short Term
Mutual fund investors less enthusiastic as they learn stock market is not a one way street. Mutual fund investor speculation monitor remains at low levels.
Getting Back Together On The Upside
Impressive rally did not alter Negative status of Major Trend Index. S&P 500 beat 90% of sectors in April. Earnings holding up well in Q1, but margins likely to shrink as the year progresses.
Index Fund Update
Index fund assets approaching $78 billion, 6% of U.S. focus fund assets... Year to date, index fund flows now account for about 14% of domestic total.
Joke of the Month
We received a number of good jokes this month, but considering this issue’s religious humor theme, it was decided that a joke from Weeden’s Peter DeOteris should be anointed the May winner.
Risk/Reward Stock Substitutes
Bonds as attractive Risk/Reward substitutes...disguise them with fictional names such as Bondo Ltd., etc.
Scanning the Markets
Narrowness in the stock market was very evident in April, as the DJIA’s 6.3% gain was better than 70 of the 78 sectors we track (90%).
View from the North Country
Human behavior demonstrates that individuals as a group are risk averse…studies of investor behavior have yielded some interesting findings. Also, Japanese low interest rates in themselves have not yet converted caution and pessimism into confidence and optimism.
Stock Market
- Getting Back Together On The Upside
- 1997 Volatility: Indicating a Major Stock Market Transition
- Index Fund Update
- Equity Fund Flows…Short Term
- Risk/Reward Stock Substitutes
- View from the North Country