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IBDvalueinvestin (98.52)

Get ready for Ugly Jan. Data starting next week.

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January 30, 2014 – Comments (6) | RELATED TICKERS: DOG , QQQ , SQQQ

We all know how cold its been in nearly 3/4 's of the USA this January. It should not come as a surprise to investors when all the bad news of January starts hitting the market in Feb.  This will include many sectors like construction, manufacturing and retail. The only sector that should benefit is gas sales and home heating oil. 

6 Comments – Post Your Own

#1) On January 30, 2014 at 4:38 PM, Lordrobot (91.42) wrote:

Value, is it your take that the bad news or as it were bad data was simply a function of the cold winter or is there perhaps something more fundamental going on here?

I am reminded that Bernanke never even saw the housing crash until it fell down on his head. Fed comments would seems useless in a larger more fundametal event. 

My background with data centers around the velocity of bad data. It is my sense that the velocity of the missed employmet fell into a category of shock data rather than a mere miss. This has been followed by other shock data and some vapors that indicate emerging markets may be suffering from a lack of liquidity. 

In the USA, new housing and existing housing took a nosedive. Since closings generally run greater than 30 days, I am perplexed as how this data could be related to the Thermal Vortex.

US Corporate earnings has been pretty good but guidance terrible. I don't see how a Thermal Vortex would alter this. 

Lastly, there appear to be cracks in the foundation of various retailers especially mall related retailers, JCP starting last year, Radio Shack starting last year. Is this a sign that the middle class consumer is fatigued or just cold weather?

My concern is that the data velosity was high and it appears to be converging. That usualy portends a big unpleasant future event. Seasonal cold weather has never triggerd what we are seeing in terms of data velocity. Is there a possibilty this is just the tip of the iceberg? 

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#2) On January 30, 2014 at 5:11 PM, ThisIsFor2053 (28.83) wrote:

I find it comical that you are using retailers like JCP and Radio Shack to gauge consumer sentiment.  Why don't you throw Best Buy in there too?

Do you know what all of these stores have in common?  How about I haven't stepped foot into any of them in about 8 years?  I'm 26, and I can pretty confidently say that the majority of people my age also haven't stepped foot into them in that long.

You know what stores I have stepped foot into?  Under armour. Apple.  Williams Sonoma (yes, I really have).  Costco.  Nordstrom Rack.  Home Depot.

Do you know what those stores have in common?  They are selling things that people want.

Cracks in the foundation of retailers? You make me openly laugh by calling JCP and Radio Shack the foundation of retailers.

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#3) On January 30, 2014 at 6:03 PM, EnigmaDude (51.43) wrote:

Agreed that some retail and construction related stocks may take a hit but not so sure about manufacturing (why would cold weather affect them?).  Also believe that some airlines will take a hit - I recently red thumbed Jet Blue for that very reason.

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#4) On January 31, 2014 at 10:31 AM, Mary953 (84.17) wrote:

Thisisfor2053,  I find your list of stores interesting.  You are 26, I am 60 and yet we both choose the same stores to shop at and avoid the same stores.  We don't have Nordstrom here, but other than that.....

The first time that I bought Apple stock, it was at 95.  I bought it because it was packed with people looking at the merchandise.  On an entire street full of empty stores, it was the only one with customers and they were buying.  That is the sort of sign that you pay attention to.  As long as the stores are busy, I will be holding Apple.  I plan to go to Potbelly for lunch today to check them out.   Same principle. 

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#5) On February 03, 2014 at 11:10 AM, IBDvalueinvestin (98.52) wrote:

I knew manufacturing was going to be down because of the weather. I did not want to be called on insider trading information by providing any type of specifics.

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#6) On February 03, 2014 at 11:13 AM, IBDvalueinvestin (98.52) wrote:

I knew manufacturing was going to be down because of the weather. I did not want to be called on insider trading information by providing any type of specifics.

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