Mark Hulbert: Stocks as overvalued now as at 2007 high

Here’s yet another reason to be worried about the stock market: A valuation model with an impressive record says that stocks are as overvalued today as they were at the 2007 stock market peak.

The model comes from Dan Seiver, a member of the economics faculty at Cal Poly State University. Seiver also is editor of an investment advisory service named The PAD System Report. Though Seiver created the model nearly 30 years ago, he recently co-authored an academic study of the model’s effectiveness that appears in the current issue of the Journal of Wealth Management.

Seiver’s model is based on a single number that is published each week in the famed Value Line Investment Survey, published by Value Line, Inc. The number represents the median of the projections made by Value Line’s analysts of where the 1,700 widely followed stocks they closely monitor will be trading in three to five years’ time. Followers refer to this number as the VLMAP, which stands for Value Line’s Median Appreciation Potential.  (more)

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Canadian Government Blows-Up Housing Bubble

Stephen Harper’s Ultimate Crime is almost complete.
His campaign to destroy Canada’s economy began with his relentless, meticulous efforts to duplicate the disastrous U.S. housing bubble in Canada (along with piling up years of record deficits). We can be absolutely certain of Harper’s criminal intent here because he chose to duplicate the U.S. housing bubble in Canada after that market had already collapsed in an orgy of fraud-and-foreclosure.
But creating a bubble he intended to blow-up was only Harper’s first step in this malevolent plan. Step Two was preparing for after he blew-up his own bubble. Canada is the first – and only – Western nation to write “bail-in” provisions into its own, current budget.
For those readers, who were snoozing during the Cyprus Steal (and the details revealed about that crime in its aftermath); let me refresh your memories. The governments of Europe (under the control/direction of the One Bank) staged a carefully-planned “bank robbery” in Cyprus.
Continue Reading at BullionBullsCanada.com…
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Consolidation or Exhaustion?

This is a big question going around some of my circles these days. I’ve heard valid arguments from both sides. The bulls are convinced that any dip, or even pause, is an opportunity to just buy US Stocks. And the bears are convinced (and have been) that the rally can’t keep going like this without correcting first. The last few weeks of trading have caused both of these camps to question their conviction. At least that’s how it appears from where I’m sitting.

As you guys know, I try not to be a bull or a bear, but just take what the market gives us and look for good risk/reward opportunities that way. Most of the time, my positions have nothing to do with the direction of the S&P500. But it’s important to have an idea of which way we’re headed, especially if the resolution out of this might be to the downside. You see, during violent sell-offs, it doesn’t matter how “good” your stock is, or how much cash it has on the books, or how many times momentum has confirmed new highs. When assets are being liquidated and your stock, or commodity becomes a “source of funds”, they will sell your stock harder than you could ever imagine. This happens much less often on the way up.

So? Is this a consolidation in the S&P500 before a new leg higher? Or was that it? Was that the bull market?  (more)

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McAlvany Weekly Commentary

Ian McAvity: Gold is Pouring from the West to East

Posted on 14 August 2013.

About this week’s show:
-Summers at Fed would be bad news for us
-Price drop in April caused rush to physical gold
-PB of China to be 2^nd largest holder of gold

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Abercrombie & Fitch Co. (NYSE: ANF)

It is very common for me to discuss Head and Shoulders (H&S) patterns in my articles. An H&S pattern is a reversal pattern that forms after an uptrend. A textbook H&S pattern starts to form when a stock rallies to a point and then pulls back to a particular level (shoulder #1). Next, the stock will rally again, but this time to a higher peak (head) than the previous shoulder. After forming the head, the stock will pull back to the same support as the first shoulder did. Finally, the stock rallies a 3rd time, but not as high as the head (shoulder #2). The level that has been created by all 3 of the pullbacks is simply a support level referred to as the “neckline”. The formation of an H&S pattern warns of a potential reversal of the uptrend into a possible downtrend. As with any chart pattern, a trader will usually not want to act on the pattern until the stock “confirms” the pattern. Confirmation is the break of the key level that has been created by the pattern. In the case of an H&S, confirmation would be when the stock breaks the neckline (support).

H&S patterns can also form upside-down and the pattern would be called an Inverse Head and Shoulders. It too is considered a reversal pattern after a downtrend, but it can also be a continuation pattern in an uptrend. The neckline would be a resistance rather than a support.

To see such an Inverse H&S pattern potentially being formed, please take a look at the 1-year chart of ANF (Abercrombie & Fitch, Co.) below with my added notations:
After trading mostly sideways for the last (8) months ANF has formed what appears to be an Inverse H&S (blue). I have noted the head (H) and the shoulders (S) to make the pattern more visible. (If it helps to visualize, imagine this pattern flipped upside down and you would have a regular H&S pattern.) ANF's “neckline” resistance is at the $52 level (red). ANF would confirm the pattern by breaking up through the $52 resistance, and if it does, the stock should be moving higher from there.
Keep in mind that simple is usually better. Had I never pointed out this Inverse H&S pattern, one would still think this stock is moving higher simply if it broke through the $52 resistance level. In short, whether you noticed the pattern or not, the trade would still be the same: On the break above the key $52 level.

The Tale of the Tape: While moving sideways ANF seems to have formed an Inverse Head & Shoulders pattern. A long trade should be entered on a breakout above the $52 level with a stop placed under that level.
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P&G: 56 years of rising dividends

Procter & Gamble (PG) is not a gamble for investors; indeed, it is one of the most financially sound companies among the Dow 30.

The company the leading consumer product company in the world; it is famous for its products in beauty, grooming, health care, fabric care, home care, baby care and family care.

Everyone is familiar with Gillette, Tide, Pampers, Head & Shoulders and Crest toothpaste, among its 100,000 consumer products. But P&G is aggressively introducing new products to stay ahead of the competition, and it recently introduced three of the top ten most successful new products last year.

One of the recent innovations of P&G is in the laundry segment. It was the introduction of detergent pods, which are easier to use, create less waste and have less potential for a mess.(more)Please share this article