The Big Picture

Friday Night Soul: James Brown in Eighteen Minutes
Succinct Summations of Week’s Events 8/8/14
Structural Bull Market ?
10 Friday AM Reads
Halfway through the Correction
Economics Gurus Get Schooled at Camp Kotok
Quant’s e-Sportlimousine: Electric Revolution
Adjusted Employment to Population Ratio as an Indicator of Labor Market Strength

Friday Night Soul: James Brown in Eighteen Minutes

Posted: 08 Aug 2014 03:00 PM PDT

"Get On Up" is the new biopic out on James Brown. David Remnick of the The New Yorker calls it “the second-best film ever made about James Brown.”

But rather than watch a good impersonations, how about seeing the real thing? The following James Brown video has been called the “most thrilling, compressed, erotic, explosive form, just eighteen minutes long, and is also arguably the most electrifying performance in the history of postwar American music.”

Quite a claim. Check it out:

Source: The New Yorker

Here’s Remnick to explain:

“Brown, who had played the Chitlin Circuit for years, was genuinely incensed that the producers would put him on before pallid amateurs (in his mind) like the Stones. His performance, he later admitted, was a cutting contest that he refused to lose. As Brown puts it in his memoir, "James Brown: The Godfather of Soul," "We did a bunch of songs, nonstop, like always. . . . I don't think I ever danced so hard in my life, and I don't think they'd ever seen a man move that fast." It was a four-song set: the staccato blues number "Out of Sight"; an astonishing inside-out revival of "Prisoner of Love," which had been recorded by smoothies like Billy Eckstine and Perry Como; the dramatic centerpiece "Please, Please, Please"; and the closer, "Night Train," which the boxer Sonny Liston would play to get himself going in the gym…

This was the first time that Brown, while singing "Please, Please, Please," pulled out his "cape act," in which, in the midst of his own self-induced hysteria, his fit of longing and desire, he drops to his knees, seemingly unable to go on any longer, at the point of collapse, or worse. His backup singers, the Flames, move near, tenderly, as if to revive him, and an offstage aide, Danny Ray, comes on, draping a cape over the great man's shoulders. Over and over again, Brown recovers, throws off the cape, defies his near-death collapse, goes back into the song, back into the dance, this absolute abandonment to passion.

Its no wonder that Jagger and Richards, watching from twenty feet away, grew nervous over the thought of following the hardest working man in show business..

Previously:
James Brown, Godfather of Soul: RIP (December 25th, 2006)

On Film: The Invention of the Moonwalk (April 26th, 2014)

See also:
"Mr. Brown, On the road with His Bad Self" New Yorker, July 2002

Succinct Summations of Week’s Events 8/8/14

Posted: 08 Aug 2014 12:30 PM PDT

Succinct Summations week ending August 8th

Positives:

1. AAII bearish sentiment rose to its highest levels since August 2013, people still are so quick to call a top for this bull market.
2. Chinese exports increased by 14.5% in July, the biggest increase since April 2013
3. Initial jobless claims came in at 289k vs 304k expected, the 4-week moving average fell to the lowest levels since '06.
4. ISM service index came in at 58.7, up from 56 in July and better than the 56.5 estimated.
5. Factory orders came in better than expected, grown 1.1% m/o/m vs 0.6% expected
6. The petroleum deficit fell in June to its lowest level since 2009.
7.MBA refinancing applications rose 3.8% w/o/w.

Negatives:

1. After having its worst week since '12, U.S. stock funds suffered their largest weekly outflow in six months.
2. U.S. 10-year yields fell to their lowest level in 14-months as investors flocked to safety.
3. Italy reported a 0.2% q/o/q drop in GDP, their stocks are off 10% in just the last week and a half.
4. The Nikkei closed down 3% on Friday, its worst session since February.
5. The Dax is in correction territory; down 10% from its July highs.
6. MBA mortgage applications fell to their lowest level since February.

Structural Bull Market ?

Posted: 08 Aug 2014 11:00 AM PDT

Source: Raymond James Research

This morning, I made note of the difference between secular bull and bear markets. I described secular bear markets as being longer-term, characterized by strong rallies, vicious sell-offs and earnings contractions.

Secular bull markets include an investor willingness to pay more and more for the same dollar of earnings even as stock prices rise. (I'll revisit this issue next week.) The simplest way to think of secular markets is as longer eras driven by overriding dynamics that define the period ether positively or negatively.

Continues here

10 Friday AM Reads

Posted: 08 Aug 2014 06:45 AM PDT

My morning train reads (continues here):

• Why the Stock Market Is Struggling to Regain Momentum (MoneyBeat) but see Learning to Love Volatility (Rick Ferri)
• The 2000's Was the Worst Decade For Investors (Yahoo Finance)
• Europe’s low inflation is sending it into a lost decade (WonkBlog) but see Fed Hawks Squawk (Tim Duy’s Fed Watch)
• Of macro and micro at Leen’s Lodge (SNL)

Continues here

Halfway through the Correction

Posted: 08 Aug 2014 05:45 AM PDT

Last month, we discussed how we might be on the verge of a correction. We also noted the futility of trying to time the start and finish of such events. What actually matters is how you react — or overreact.

As my colleague Josh Brown has observed, "since the end of World War II (1945), there have been 27 corrections of 10 percent or more, versus only 12 full-blown bear markets (20 percent or worse)."

However, the data show that the distribution of corrections isn’t smooth. Indeed, almost half (45 percent) of the corrections occurred either in the 1970s or the 2000s. Both eras were part of longer-term secular bear markets, characterized by strong rallies, vicious sell-offs and earnings contractions.

It is noteworthy that almost half of the corrections occurred in two out of seven decades. I suspect this fact isn’t a coincidence. From a 30,000 foot view, it may be a key to understanding how likely a more severe correction might be.

Continues here

Economics Gurus Get Schooled at Camp Kotok

Posted: 08 Aug 2014 04:00 AM PDT

Every summer, financial luminaries like Paul McCulley of PIMCO spend four days at Camp Kotok, an annual summer retreat in a remote part of Maine.

Quant’s e-Sportlimousine: Electric Revolution

Posted: 08 Aug 2014 03:00 AM PDT

~~~

Video

From Classic Driver:

So how does it work? Quite complicatedly, as it turns out. Essentially, each wheel has its own electric motor, drawing power from a central 'Nanoflowcell', a new chemical battery system capable of storing and releasing electrical energy at extremely high densities. Allegedly, the technology is a 'beacon of hope' for the future of electric transport, owing to its compact, powerful and effective nature. It will also charge much more quickly than conventional batteries. The figures speak for themselves – 217mph, 0-60mph in 2.8sec and a range of over 600km.

Source: Classic Driver

Adjusted Employment to Population Ratio as an Indicator of Labor Market Strength

Posted: 08 Aug 2014 02:00 AM PDT