A Journal of Independent Research, Analysis,
 Opinion and Insight

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Algos For Everyman
Tim Quast: His Data Analytics Suss Out Market Demand, Suppy, Trends
When I interviewed Tim Quast in these pages almost a decade ago, he was quite evidently a data man on a mission. “Fighting Fire with Fire,” as the headline put it, Tim and ModernIR, his then-8-year-old Denver-based investor relations consulting shop were trying to demystify and level a hyperkinetic market playing field for the companies whose shares were erratically levitating and crashing, seemingly without reason — and using algos and data analytics to do it. 

What’s changed, besides the fashionable stubble on Tim’s chin? Well, the depth and size of his data resources, of course, and the power and sophistication of his algorithms. And with that, Tim and company’s ability to decipher and sort out mathematically the forces besieging the markets.

U.S. Inventory Bloat
Coming Drawdown Likely Will Pack Deflationary Punch
6/03/22 8:00 AM
By Dave Rosenberg
With inflation mania dominating the news cycle, it’s easy to miss key developments that portend to an easing in price pressures ahead. And here we’re talking about slowing demand which, on its own, is deflationary, but is also leaving firms with excess inventories at both wholesale and retail levels — a recipe for some aggressive discounting over the coming quarters.

Making Friends With Bears
Using Math Is An Essential Survival Skill
6/03/22 7:00 AM
By John P Hussman
A fascinating aspect of the financial markets is that long-term returns are driven almost entirely by math, while short-term returns are driven almost entirely by psychology. It’s useful to consider both.

Recycling Rubles
How Will Russia Manage Ballooning Current Account Surplus?
6/03/22 6:00 AM
By Louis-Vincent Gave
Most of what Russia exports — coal, oil, natural gas, fertilizer — has been shooting up in price. Not so long ago, the revenues generated by such a surge in commodity prices would have been recycled into Mercedes cars, St Tropez holidays, Gucci loafers, London real estate, eurozone government bonds or US treasuries.

M2 Hits The Skids
Fed’s Tough Talk Transitioning Into Tightening Action
6/03/22 5:00 AM
By Doug Ramsey
The Major Trend Index remained in its negative zone for the week ended May 27th, supporting a continued cautious stance toward equities. We expect the market to slide to new lows as the summer progresses.

Coming Out Of The Dark
How Can More Displayed Liquidity Be Encouraged In Markets?
6/03/22 4:00 AM
By Joe Saluzzi
How can more displayed liquidity be encouraged?  This question has been asked for years by regulators and market participants but still has yet to be answered. The major stock exchanges continue to think that paying for order flow with liquidity rebates is the answer.

Growth Investors Facing Resistance Every Which Way
6/03/22 8:20 AM
By Andrew Lapthorne
Global equity markets were extremely volatile in May. MSCI World dropped 5.6%, only to recover those losses in the second half of the month and finish largely flat for the month. [More]

A Prudent Maneuver
Selling Into Short-Term Strength Is Likely Best Course
6/03/22 7:20 AM
By Jonathan Lin
Sell into Strength?!
The current market environment certainly makes for interesting times. [More]

Holding Patterns?
Consolidation Likely To Frustrate Bulls And Bears
6/03/22 6:20 AM
By Blaze Tankersley
The market moves generally as forecast, I want to follow up on the market note of 5/24 where I had listed a bunch of positive divergences and see how those indicators are progressing. Best to keep an eye on how the market handles this ~4198 level. [More]

Cautious But Nimble
The Lows Most Likely Are Yet To Be Registered
6/03/22 5:20 AM
By Gail Dudack
Stay Nimble
We do not believe the lows of the current bear market cycle have been found; however, technical indicators suggest a rebound in prices is likely in the near term. Supporting a short-term rally scenario is the fact that both the Nasdaq Composite and the Russell 2000 traded more than 20% below their 200-day moving averages in mid-May. [More]

Fueling Alternatives
Gas Station Choice And The Implications For Electric Charging
6/03/22 8:00 AM
By Jackson Dorsey, Ashley Langer and Shaun McRae
This paper estimates an imperfect information discrete choice model of drivers’ refueling preferences and analyzes the implications of these preferences for electric vehicle (EV) adoption. [More]

Targeted Forgiveness
Cleaning Up College Loan Mess And Redressing Failures
6/03/22 7:00 AM
By Adam Looney
When it comes to the disaster that is our student loan system, some debt forgiveness will undoubtedly be part of the solution. [More]

Pricey Hospitals Better?
Only In Competitive Markets, Study Demonstrates
6/03/22 6:00 AM
By Zack Cooper, Joseph J Doyle Jr, John A Graves and Jonathan Gruber
We analyze whether receiving care from higher-priced hospitals leads to lower mortality. [More]

Mega Firms & Inequities
Just A Few Industries Drive Left & Right Tails Of Pay Distribution
6/03/22 5:00 AM
By John C Haltiwanger, Henry R Hyatt and James Spletzer
Most of the rise in overall earnings inequality is accounted for by rising between-industry dispersion from about ten percent of 4-digit NAICS industries. [More]

Racial Disparities
Not Hard To Find In PPP Lending In Florida
6/03/22 4:00 AM
By Sergey Chernenko and David S Scharfstein
Using a large sample of Florida restaurants, we document significant racial disparities in borrowing through the Paycheck Protection Program (PPP) and investigate the causes of these disparities. [More]

Acute Observations, June 3, 2022
Perceptive Commentary from May 14-June 3, 2022
6/03/22 8:00 AM
Joe Weisenthal
You never hear about fast-growing tech companies referred to as zombies. But I think we should start referring to them as such for two reasons.

1) It’s clear that a lot of these companies only exist due to abundant investment capital.