SEASONALITY STOCK REPORTS

[sludgehound]

nice logo, CBSMW Money Supply article

Hi David. Neat logo design. Bit of eye candy and yes does
have that otherworldly quality. Stimulative.
Here's something that I came across last week that might
be considered regarding your comments on Money Supply
impact and stock market action.
Back in 80s there was a lot of discussion about M1-M2
and commod-stocks. In 90s the concern shifted to New
Tech and its effects on Economy. Now there seems to be a
bit of a limbo regarding finding directional tools. Some
try retail sales, job growth, deficit spending. Hard to
tell what's going on. I suspect a 70s style of stagflation with only tiny shifts here & there.
Anyway check this out. Tho writer is using a longer timeframe than you were in your piece:

That means that the stock market over the past 46 years has performed the best following months in which the 12-month change in the money supply was the lowest.

So to the extent that the newsletter editors are right to pay attention to the money supply, the conclusions they are drawing are precisely opposite to those justified by the data.

Leaving the newsletter editors aside for the moment, how much importance should you place on these few correlations that did emerge from my data mining efforts? Probably not a lot. I tested for so many different possible correlations that one would expect from randomness alone a few false positives.

But if you are inclined to draw investment implications from the correlations I found, they would appear to be bullish. M3 over the past year has grown about 4.9 percent, which is lower than 81 percent of all comparable rates of change since 1959.

http://www.marketwatch.com/news/story.as...mp;cbsReferrer=