MTS Insights

Hey guys, over Thanksgiving break, I wrote a little paper on some of the ways Ben Bernanke communicated with the market in order to try and fight the financial crisis. He called it "open mouth operations" a very catchy name that is referenced in my paper. If you would like to read it, go to the second tab on the website! Also, commenting is available for anyone who wishes to share their opinion. Enjoy, Jacob

Trading resumes on the last full week of November with one of the biggest retail days in sight. After Thanksgiving feasts in the United States, consumer, both online and off, will spend copious amounts of money trying to capitalize on their favorite stores' sales. Like a proverbial"run of the bulls" at Pamplona, hordes of people will wake up early just to partake in the opening of the most robust season of spending in the world, the road to Christmas. Just like those charging bulls in Pamplona, investors will tend to trade in an uptrend as many sectors feel a boost of demand. While prospects for consumption are sure to increase going into December, trading sentiment is currently dragged down by bearish energy shares. Therefore, we should see a lot of flat movement as buying and selling in the overall market will be about equal. individual industries might experience different trends, but broad-based gains and losses should cancel any clear trend through the rest of Novemb...

Today, investors trade off of gains in Wednesday from the release of the FOMC meeting minutes that supported rate hikes in December. As a result, the S&P 500 gained 1.35% at the signal of stronger economic growth as well as the conveying the belief that rate hikes are the right move. Some of the more hawkish Fed members already voiced regrets of not raising rates earlier and the tide seems to be turning in their favor. In my opinion, the major delay of rate hikes this year has splotched Janet Yellen's credibility as a central banker who can rule on the middle ground. Her decisions demonstrate her dovish tendencies in FOMC meetings which may have appeared desirable coming out of the financial crisis with a sizable unemployment but not during stabilization periods of the business cycle. While most lost faith in the free market system during 2008, it remains the single most effective pricing mechanism for the value of goods and the value of capital. The Fed cannot facilitate limit...

The biggest story of the weekend, which has already begun to pour into the following week, was the terrorist attacks in Paris along with the manhunts and retaliations that followed. Most people understand the political ramifications of the ISIS attacks but aren't often as privy to the consequences in the markets. This is exactly the premise of successful terrorism, that the target experiences detrimental changes in political, social, and economic structures which either hinders growth or disrupts the ability to strike back. In this case, ISIS sought to limit the political will to conduct an air campaign in Iraq and Syria. The results? Well, let's say they came out in favor of solidarity. The S&P 500 of the United States actually grew  1.51% over the past two days with Monday's movement more intense than today's flat movement. Small cap stocks remained solid as well despite bearish movement last week and the attacks in Paris. Gains of 0.73% were sustained even thou...

Just three days after horrific attacks in Paris that leave over 120 dead on a Friday night, military responses intensify as France and coalition-lead forces have revenge on their minds. Consequently, dozens of air raids over some of the Islamic State strongholds occurred early today.Among the targets, spread over lands in Syria and Iraq, French bombers leveled the unofficial capital of the terrorist organization in Raqqa. While many military bases and industrial structures were successfully hit, a news website associated with ISIS reported that there were no casualties from the attacks although that is most likely not the case. These attacks introduced the conflict to more aggressive plans from Western forces that include President Obama's "amplification: of air campaigns as well as special operations that will be employed strategically in order to continue towards the objective of containing the Islamic State and the organization's desire to increase the amount of terrori...

Once again, the busy trading week ends with decisive movement to take into the doldrums of Saturday and Sunday. Investors are left with a particularly bad taste in their mouth after stocks turn bearish on them. Across the globe, we are seeing a systematic loss hit securities that may or may not have been at speculated highs. Let's look at a chart. Provided by FactSet Here, we have three of the major national indexes plotted over the past three months, from the correction in August to trading now. Most of the trading that is represented by the graphs is in October, the month with the largest bullish gains so far this year. As can be seen, equity growth during that month surged up to pre-correction heights (except for the Shanghai Composite Index). The S&P 500 reached a new high. in fact, just 0.87% higher than pre-correction levels, and the Euro STOXX 50 capped at just under that point. Even though the Chinese stock market only gained to about 90% of their previous price,...

Tonight, just across the Atlantic Ocean, the night of Friday the 13th has been painted with terror. In five different spots around Paris, either gunman or explosions sought to kill and destroy the everyday life that only terrorists would desire to end. Crowds of spectators at an international soccer exhibition were evacuated to safety after two explosions alerted the local authorities to converge upon the street in search of the attackers. Just miles away gunman walking down Parisian streets, entering various popular Friday night locations, and killing dozens of civilians were neutralized after the massacre ensued. Immediately after, emergency relief personnel flooded the scenes with firefighters, policemen, and eventually French military units assisting survivors, both injured and uninjured. The death count is estimated to be between 80-100 with higher estimates at 120. French President François Hollande declared an official state of emergency as well as closed borders as his gove...