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Registered Investment Adviser Caleb Lawrence

 

The major averages opened sharply lower after the drubbing Trump took on the ACA repeal Friday, losing a lot of his political luster in the process.  Despite a lack of real news the major averages recovered their earlier losses to enter the final hour about even.

The Dallas Fed regional index fell 8 points in March to a still respectable 16.9 on weakness in capacity utilization, new orders and employment giving up a lot of the post-election gains.

With the 4th quarter Standard and Poors 500 earnings season more or less a done deal, the good news is that earnings actually grew again up 29% from a very low comparison quarter.  That only after the expectation was cut by nearly half to enable the growth recorded.  In aggregate Dollar terms the $24.15 for Q4, brought the calendar year total below $95, the ninth straight quarter less than $100.  Just another sign of the muddle along weak economic and business cycle recovery.  Given valuations and a number of other relevant factors should the GOP fail to deliver on the expected tax cuts, something likely to prove difficult given the borrowing and debt status, then the “Trump” trade could well give way to the “chump” trade.

Also of note it appears based on sales volume, inventory for sale, month’s supply, and what is now an 8-month trend that the wheels are coming of the south Florida condo market.  Incidentally south Florida and Las Vegas proved to be ground zero for the 2007-2009 real estate crisis.  History may not repeat but it often rhymes.

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