Friday, October 10, 2014

For comparison, the 4 major US indices

Just to get an idea of how ugly this is turning, take a look at the 4 major indices' charts.  First up, the Dow filled with monstrously large dividend paying companies. 

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Next up, the SP-500.  500 of the largest, most important companies in the world.

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Next, the trader's and amateur investors darling, the Nasdaq.  Filled with speculative Tech and Pharma stocks all with with very little in earnings and virtually no dividends whatsoever.  Today, the dow was down 115 points.  The nasdaq was down 102.  Reminder, the Nasdaq is less than 1/3 of the price of the Dow, yet was down nominally the same amount.

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And last but not least, The Russell 2000.  The small caps that fly like Superman in a Bull market, but get squashed like a mosquito in a Bear Market.  Unlike the other 3 indices, The Russell has not been in an uptrend for a while.  It has been consolidating in a range that just broke down badly.  I'm zooming this one out more so you can see it better.

Moral of the story, safety is found in large dividend paying stocks, and the speculative crap is getting tossed away.  So as the markets all begin to break major support and half a decade long uptrend lines, I will leave you with this... Have a Nice Weekend!  (And try not to spend the whole thing worrying about what is gonna happen to your life savings come Mon morning)

-Jonathan M Mergott

P.S.   That was sarcasm for those of you who haven't mastered the art of detecting it in written form over the internet.  Cause I know damn well that is the ONLY thing Wall St. and every QE made "genius investor" is going to be thinking about all weekend.

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