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Stocks New Highs in 2017

Blog Feb 22, 2017

Youtube Translation

Hi everybody and then chief market analyst here at ITM Trading a full-service physical precious metals brokerage house and we all probably heard about the stock market globally making new highs yet again and beating the longest streak of new high ever cetera et cetera so this is what that looks like but let’s ask let’s just kind of look a little bit beneath the surface is just the dojo that’s all we know that’s low level of local belgium ok now this graph is from golden facts and it shows she’s declining earnings while the market is going up we’ve talked about this before it should be pretty clear that the markets are going up even when people are willing to or mutual funds pension funds hedge funds etc are willing to pay more for stock as their earnings go down so why are they doing it how are they doing it keeping in mind that stocks for a lot of the compensation for a lot of these corporate the top of the corporate food chain that’s why they want the stock market to go up plus when you open up your k statement if every single it’s okay so we know we want them to stay in the market but take a look at this I think this is interesting this happens to be hsbc but in reality since the early s when the market really started trouble even though nobody knew it stock buybacks from corporations exploded now look there could be good reasons for stock buyback but this is really more about lifting the stock price the no profits fell -percent and they’re announcing bigger stock buyback but look at this state the incorporation that actually pay out and make sure remember lower the links that you can see these specifically but these are corporations that payout war and dividend then they are so in this low interest rate environment number one if they’re paying higher dividend it can attract more people to it but again who really has the lion’s share of the stock it’s the corporate executive so that’s another tool to push the stock price higher i reward those insiders and transfer wealth this is from the Federal Reserve and this is showing or debt I mean how long can accompany payout war in dividends than they are and how can they do that anyway they could do it for a little while as long as they’ve got the cash where they can borrow the cash to maintain this so what happens when they take on debt they buy that shares they pay out more in dividends and they’re earning who’s really going to be left holding the bag that’s the question that you have to ask yourself because what we’re also hearing and remember we’ve talked about the lack of liquidity that’s really about when a lot of people want to sell who is going to lie this is from Bloomberg an article on the hedge funds and look at that look at on that bottom piece right here where your actual lowest level ever and typically when that happens you get a market correction there are no buyers in this market so I don’t know if you’re in or not personally I am NOT in my opinion it’s a much safer place to be on the sidelines and then obviously in an undervalued ask that which is gold and silver as well but now i also want to show you one thing and i’m going to be talking more about this as time goes on because i don’t think people understand the securitisation process securitisation is when they take something that’s real and they turn it into to a financial product so today we’re going to just look at what’s happening in the auto industry this blue line here where I’ve indicated it and this is from New York Fed report take you can see that in that blue line during the crisis and drop dramatically but look at where it is right now so there are a whole lot more loans being put out by those with lower credit ok this is how that giving who’s giving out those walls now here’s the problem ok problem is is that most of those loans are coming from the car manufacturers themselves so we know let’s see i’m going to read this according to this report from the federal reserve of New York the year and shopping push vehicle loans to . trillion okay why is that a problem because of this this again from the Federal Reserve shows you vehicle loans that have been securitized ok in other words turned into a financial product and salty you in the form of mutual funds etc this is where we were in the crisis this is this is where it is right now can you see the problem we’ve got growing delinquencies that are days plus it’s not the bank or even necessarily the lauder companies are the auto companies that are going to take it on the chin its all the people that unknowingly is a reach for yield in the current low interest rate environment that have put beans is the pension funds and mutual funds DPS and all these different products and nobody ever bothers to take the time to read the prospective why am I really holding my well in we’re going to talk a lot more about securities nation and really important part in here and I want to understand it so that’s my time for today i hope you found it beneficial go ahead and subscribe to our YouTube channel that you know what we’re doing a live event follow us on twitter like us on Facebook

2-22-17 S&P companies with the highest div payout ratios

2-22-17 S&P Rallied as consensus adjusted EPS were revised down

2-22-17 Insider buys sells ratio at 120 2 1

Thumbnail Photo We believe that everyone deserves a properly developed strategy for financial safety.

Lynette Zang

Chief Market Analyst, ITM Trading

Sources & References In This Article


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