{"id":18082,"date":"2012-03-02T10:15:41","date_gmt":"2012-03-02T15:15:41","guid":{"rendered":"http:\/\/www.thedisciplinedinvestor.com\/blog\/?p=18082"},"modified":"2016-09-20T19:17:45","modified_gmt":"2016-09-20T23:17:45","slug":"a-market-riddle","status":"publish","type":"post","link":"https:\/\/thedisciplinedinvestor.com\/blog\/2012\/03\/02\/a-market-riddle\/","title":{"rendered":"A Market Riddle&#8230;."},"content":{"rendered":"<p>Here is a riddle: Why were markets up on Thursday?<\/p>\n<p>For one, it could have been that initial jobless claims held in the 350k level.<\/p>\n<p style=\"text-align: center;\"><a href=\"https:\/\/thedisciplinedinvestor.com\/blog\/wp-content\/uploads\/2012\/03\/initialclaims_03012012.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-12706\" title=\"initialclaims_03012012\" src=\"https:\/\/thedisciplinedinvestor.com\/blog\/wp-content\/uploads\/2012\/03\/initialclaims_03012012.jpg\" alt=\"\" width=\"548\" height=\"341\" \/><\/a><\/p>\n<p style=\"text-align: left;\">That is where the logic of this discussion<!--more--> ends. Why? Because it surely wasn&#8217;t because of the ISM Manufacturing report. That came in below expectations and is turning lower.<\/p>\n<p style=\"text-align: center;\"><a href=\"https:\/\/twitter.com\/andrewhorowitz\" class=\"twitter-follow-button\" data-show-count=\"false\">Follow @andrewhorowitz<\/a> <script src=\"\/\/platform.twitter.com\/widgets.js\" type=\"text\/javascript\"><\/script><\/p>\n<p style=\"text-align: center;\"><a href=\"https:\/\/thedisciplinedinvestor.com\/blog\/wp-content\/uploads\/2012\/03\/ism-03012012.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-12707\" title=\"ism-03012012\" src=\"https:\/\/thedisciplinedinvestor.com\/blog\/wp-content\/uploads\/2012\/03\/ism-03012012.jpg\" alt=\"\" width=\"563\" height=\"314\" \/><\/a><\/p>\n<p style=\"text-align: left;\">This is an important indicator and closely watched by market participants. The silver lining may be that it is still above 50&#8230;<\/p>\n<p style=\"text-align: left;\">Within that same report was the prices paid component. That came in much higher and is a sign that manufacturers are paying more for their inputs.<\/p>\n<p style=\"text-align: center;\"><a href=\"https:\/\/thedisciplinedinvestor.com\/blog\/wp-content\/uploads\/2012\/03\/ismpp_03012012.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-12708\" title=\"ismpp_03012012\" src=\"https:\/\/thedisciplinedinvestor.com\/blog\/wp-content\/uploads\/2012\/03\/ismpp_03012012.jpg\" alt=\"\" width=\"575\" height=\"313\" \/><\/a><\/p>\n<p style=\"text-align: left;\">As prices go up, they will either cut into margins or be passed on to consumers.<\/p>\n<p style=\"text-align: left;\">Finally, markets surely did not take the income and spending report as a reason to rally. Income is down and spending is down on a year-over-year basis. Yes, the month-over-month showed a slight uptick in spending, but that has to be looked at in the context of lower income.<\/p>\n<p style=\"text-align: center;\"><a href=\"https:\/\/thedisciplinedinvestor.com\/blog\/wp-content\/uploads\/2012\/03\/incspend_03012012.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-12709\" title=\"incspend_03012012\" src=\"https:\/\/thedisciplinedinvestor.com\/blog\/wp-content\/uploads\/2012\/03\/incspend_03012012.jpg\" alt=\"\" width=\"558\" height=\"338\" \/><\/a><\/p>\n<p style=\"text-align: left;\">With these out of the way, there are only a couple of things that may have contributed to the resilience of the markets on Thursday. Perhaps the fact that the vote was well received telling us that the debt-swaps occurring in Greece are not default triggers for CDS (credit default swaps). How is that possible is anyone&#8217;s guess. What this means is that banks will not have to pay those that hold insurance against the non-default default. (This is why Goldman Sachs rallied 4%).<\/p>\n<p style=\"text-align: left;\">So, if we were to distill all of the news, reports and other important items of the day, the answer to the riddle is simple: The reason why the equity markets rose today was because&#8230;markets were open for business. Either that or it was Thursday. :-)<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Here is a riddle: Why were markets up on Thursday? For one, it could have been that initial jobless claims held in the 350k level. That is where the logic of this discussion<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","footnotes":""},"categories":[5,12],"tags":[100,483],"class_list":["post-18082","post","type-post","status-publish","format-standard","hentry","category-economy","category-markets","tag-economics","tag-markets","et-doesnt-have-format-content","et_post_format-et-post-format-standard"],"acf":[],"_links":{"self":[{"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/posts\/18082","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/comments?post=18082"}],"version-history":[{"count":0,"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/posts\/18082\/revisions"}],"wp:attachment":[{"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/media?parent=18082"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/categories?post=18082"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/tags?post=18082"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}