Record Corporate Cash or Record Debt?

zerohedge.com / by Tyler Durden / 04/30/2014 10:27 -0400

“Record corporate cash”…”Record corporate cash”… “Record corporate cash”

That pretty much covers most of the conversation on prime time financial media and TV stations when discussing corporate balance sheets.

There is, however, one big problem with that mantra. As Zero Hedge first showed in January with “Corporations Have Record Cash: They Also Have Record-er Debt, As Net Leverage Soars 15% Above Its 2008 Peak” companies indeed have tons of cash. What isn’t discussed is where that cash came from. The answer: debt. Because while companies have record cash, they have recorder-er debt.

Today, we are happy that more are starting to notice this simple math problem. Here is Deutsche Bank’s Torsten Slok who is the latest to be struck by this “revelation”.

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Long-Term Charts of AAPL & AMZN

As several tech sector giants continued to deliver a mixed bag of earnings reports, MoneyShow’s Tom Aspray takes to the charts in search of long-term opportunities.
The stock market has surprised many pundits this week as the sharp drop at the end of last week had some fearing another round of selling this week. Monday’s late reversal suggested that the buyers, not sellers, were in charge. So far, the market has held up well, and though the ratio of advancing to declining stocks has been positive, they have not been stronger than prices.
The ratio was about 3 to 2 positive Tuesday and also closed positive on Monday. The McClellan oscillator has moved back above the zero line while the NYSE A/D line is quite close to making another new high. The S&P Case-Shiller Housing Price Index was positive, Tuesday, and Monday’s Pending Home Sales were stronger than expected.(more)
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Angie’s List Inc (NASDAQ: ANGI)

Angie’s List, Inc. operates a consumer-driven solution for its members to research, hire, rate, and review local professionals for home, health care, and automotive service needs. It offers member services comprising member-generated ratings and reviews that provide reviews from members and non-members in approximately 720 categories; and service provider services for members looking for reputable providers of high cost of failure services. As of December 31, 2013, it had approximately 2.5 million paid memberships in 253 local markets in the United States.
To review Angie’s stock, please take a look at the 1-year chart of ANGI (Angie’s List, Inc.) below with my added notations:

ANGI has been trending mostly lower since July of last year. During the last 6 months though, the stock had held a clear level of support at $12 (blue). Even though the market has caused most stocks to move mostly higher over, ANGI had not been able to follow along and has recently broken below $12. This breakdown is both a new 52-week low and a break of a clearly defined support level.

The Tale of the Tape: ANGI had formed a key support level of $12, which was a 52-week low breakdown. This should signal lower prices ahead for the stock. A short trade could be entered on ANGI on a rally up to $12, with a stop set above that level. A break back above $12 would negate the forecast for a move lower and a long position could be considered instead.
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What the Collapse in Homebuilder Stocks Forewarns

Michael Lombardi
The housing market that lured institutional investors in during 2012 and 2013 is showing signs of cracking.

Before I go into more detail, you have to keep in mind that affordability is the key to the housing market and affordability for housing only increases once home buyers’ wages increase. Right now, incomes in the U.S. economy are declining. And you can add to the problem the fact that mortgage rates have been rising, too, putting further pressure on affordability for home buyers
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Dr. George Friedman: Thoughts from Ukraine | McAlvany Commentary

This week:
-The Bear is Back
-Germany dependent on Russian Energy
-Russia is never as Strong/Weak as you think
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