Operating at the Intersection of Technology and the Capital Markets
Tag: Nasdaq Composite
We've touted NASDAQ 9,000 as a bottom for over a year. That's only 14% off of current levels. Many believe that Technology stocks are cheap, but not in my book. Not in a world where the long-term Fed Funds rate settles around 300 BPS and absent QE. No more Fed put? I can easily imagine … Continue reading No Fed Put – NASDAQ 7,000?
Equity indices have rallied today as reported Headline and Core CPI increased by "only" 7.7% and 6.3% Y-O-Y respectively. Many Technology names are up double-digit percentages today on this macro news despite the fact that many companies are cutting heads (it's not just CRM, LYFT, META, MSFT, NFLX, RDFN and SHOP), given the weak economic … Continue reading Sell This Rally
This spring when I said the NASDAQ would bottom around 9,000 my thinking was as follows: 2022 would be a year where higher interest rates reset equity valuations lower, especially as it relates to the NASDAQ Composite. 2023 would be a year where poor company fundamentals reset equity valuations lower. The NASDAQ has experienced some … Continue reading Markets Have Another Leg Down
Could the NASDAQ re-test the COVID lows of March 2020 when it sat around 6,900? Yes. That would require a prolonged recession (which we expect) AND The Fed not restarting its ultra-dovish monetary policy of Quantitative Easing combined with a near zero Fed Funds Rate. Who knows how the Fed will behave in 2H 2023 … Continue reading The NASDAQ Could Re-Test COVID Lows & The Rise of High Yield
If the Fed raises by 100 BPS tomorrow we believe there is another 10% downside to the NASDAQ before October earnings. We believe the NASDAQ will continue to work lower as the Fed hikes its Fed Funds Rate and as Treasury yields climb. We expect the Fed's rate hiking will stop by early next year … Continue reading A NASDAQ Bottom. QT Or Not To QT?
We have written on a number of occasions over the past few months that we believe the NASDAQ Composite will bottom at 9,000. By when? By March 2023. That's 7 months from now if you include March 2023. We need two things to happen in order for investors to capitulate: First, we needed the Fed … Continue reading How Quick To NASDAQ 9,000?
It's a bit of an eye test and may require you to pinch and expand your phone screen. The takeaway is that the purple line that exceeds 300% year-over-year growth is the Money Supply (M1) measured at monthly intervals. When the Fed prints money and mails it to people they will spend it. In this … Continue reading Chart of The Day
This bear market rally feels more driven by FOMO than the fundamentals. What is there to get so excited about as to justify this rally off of the June lows? Inflation: Is the fact that headline CPI slowed to 8.5% from 9.1% really anything to write home about? Core CPI plus Food was up 1.4% … Continue reading This Bear Market Rally Is Overdone
The Fed's balance sheet declined modestly ending the week at $8.91 trillion, down from $8.93 trillion and up from $8.76 trillion at the beginning of the calendar year and up from $4.17 trillion in January 2020 (just before the unprecedented fiscal and monetary stimulus programs of 2020 and 2021). As we wrote on Tuesday, the … Continue reading QT Has Only Just Begun
In the pursuit of curbing price inflation Fed Chair Powell will be willing to break some glass... Speculative asset classes such as crypto, rare automobiles, fine art: YES. This has already happened to a degree, especially as it relates to crypto currencies and publicly-traded companies that have exposure to crypto such as Coinbase (COIN). There … Continue reading In Case Of Emergency Break Glass
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