The blog will be on brief hiatus until May 1, so until then I thought I’d post 5 of my most important data-points for readers to look at and ponder until then. The 5 points are the monetary base, 10 year yield, high yield spreads, US population and GDP per capita. These represent the value of the currency, the risk free rate of return, the price of risk, growth and productivity in 5 charts. Get those 5 variables right and you’re in business.
Below is a longer term chart of the ratio of the price of the S&P 500 to the GLD ETF (the data source I’m working from doesn’t have the physical gold price). It shows that despite the S&P rally since October and the pullback in gold, the “currency agnostic” value of the S&P (priced in gold) is still below where it was this time last year.
With Apple back up above $600 in aftermarket trading, the stock is now up 48% year to date. For reference, below is the performance of Apple’s stock on an annual basis going back to 1999. The most the stock ever went up in one year was 202% in 2004, when the iPhone was just a glimmer in Steve Job’s eye.
I’ve mentioned before on the blog that there are a few formations that bring out the closet technician in me. One of them is a wedge, because it must resolve itself one way or the other. There happens to be a significant wedge that’s been forming in gold over the last several months that pits the long term trend against the lower highs that have been made since September. To cap it off, the formation is culminating just in time for the Fed to speak tomorrow. Could be an interesting show…
Reposted from fcpablog.com (there really is a blog for everything I guess) below is a list of the 10 largest settlements under the foreign corrupt practices act. The largest settlement was $800m and the average of the 10 largest settlements is $317m. Based on worries about an FCPA violation, WMT’s stock has lost almost $10B worth of market cap today, 12.5x the largest settlement.
Despite the fact that it was down 2.7% today, CMG is still one of the best performing S&P 500 stocks year to date. It’s up 24% so far this year and 752% since the March ’09 lows. In order to get a sense of the company’s valuation, below is a comp table for competing restaurants centered around the number of restaurants that they own or franchise. Chipotle has 1230 restaurants that it operates with a value of $11m per store. Even Panera only has a value of $2.9m per store, while lowly Wendy’s only has a value of $283 thousand per store. If In-n-out ever came public I wonder where it would fit on this table.
The chart below is a nice info-graphic of total debt to GDP ratios (consumer/corporate/financial/govt) for different developed countries. It comes from Gundlach’s QE3 presentation which he gave earlier this week. If you haven’t looked at the presentation, it’s worth a read. The full presentation is here.
Continuing on the theme of natural gas, below is a chart comparing the price of a barrel of oil to a Barrel of Oil Equivalent of natural gas. Energy derived from a barrel of oil is roughly 8.5x more expensive than the same energy derived from natural gas.
For a longer term perspective, a multi decade chart is below: