• 847 days Will The ECB Continue To Hike Rates?
  • 847 days Forbes: Aramco Remains Largest Company In The Middle East
  • 849 days Caltech Scientists Succesfully Beam Back Solar Power From Space
  • 1,249 days Could Crypto Overtake Traditional Investment?
  • 1,254 days Americans Still Quitting Jobs At Record Pace
  • 1,256 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 1,259 days Is The Dollar Too Strong?
  • 1,259 days Big Tech Disappoints Investors on Earnings Calls
  • 1,260 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 1,262 days China Is Quietly Trying To Distance Itself From Russia
  • 1,262 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 1,266 days Crypto Investors Won Big In 2021
  • 1,266 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 1,267 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 1,269 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 1,270 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 1,273 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 1,274 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 1,274 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 1,276 days Are NFTs About To Take Over Gaming?
  1. Home
  2. Markets
  3. Other

Us Revenue, Margin and Manufacturing Recessions

Two Consecutive Quarters of Negative Growth

Full Report: Download pdf 24 Pages

Vhart 1

The NYSE Short Interest Rate (right) is at levels not seen since just before the 2008 collapse of Lehman Bros. during the Financial Crisis. Clearly there is a lot of nervousness and it is more than just the expected drop of -4.5% in the current Q3 quarterly earnings. Revenue are expected to fall -5.0% and this makes it the third consecutive fall in quarterly revenues for the S&P 500. Coupled together this reinforces the fears that the global slowdown is washing ashore in the only global hope for growth being the US Economy.

Chart 2

Corporate Free Cash Flows are additionally falling and along with widening corporate yield spreads now crimps the tsunami of share buybacks which have been holding up the US equity markets against steadily deteriorating bad economic numbers.

Sentiment & Confidence has shifted as we predicted and with it the perception of risk. The worry of a US Economic Recession is now a real possibility. Without Central Bank actions, a 2016 recession is almost a certainty. But what can the Federal Reserve realistically do with rates already near zero (see chart below)?

Chart 3

We presently see the current market activity as a counter rally in a short term correcting market. We believe we have more price downside before the central bankers are forced to rush in more triage to keep this market alive. Expect the Central Bankers to do this when the S&P 500 nears 1800. They can't afford the collateral (underpinning the debt pyramid), to be eroded any further than this level without serious consequences!


What is Coming

Central Bank Options

 

Back to homepage

Leave a comment

Leave a comment