Tag: Elliott Wave International (EWI)

Interest rates, oil prices, earnings, GDP, wars, peace, terrorism, inflation, monetary policy, etc. -- NONE have a reliable effect on the stock market

By Elliott Wave International

You may remember that after the 2008-2009 crash, many called into question traditional economic models. Why did they fail?

And more importantly, will they warn us of a new approaching doomsday, should there be one?

This series gives you a well-researched answer. Here is Part VII; come back soon for Part VIII.

Myth #7: "Peace is bullish for stocks."

By Robert Prechter (excerpted from the monthly Elliott Wave Theorist; published since 1979)

Most people would not argue that peace is bearish for stock prices. It would seem logical to say that peace allows companies to focus on manufacturing goods, providing services, innovation and competition, all of which helps the overall economy.

But does peace in fact have anything to do with determining stock prices? Continue reading "Don't Get Ruined by These 10 Popular Investment Myths (Part VII)" →

Interest rates, oil prices, earnings, GDP, wars, peace, terrorism, inflation, monetary policy, etc. -- NONE have a reliable effect on the stock market

By Elliott Wave International

You may remember that after the 2008-2009 crash, many called into question traditional economic models. Why  did they fail?

And more importantly, will they warn us of a new approaching doomsday, should there be one?

This series gives you a well-researched answer. Here is Part VI; come back soon for Part VII.

Myth #6: "Wars are bullish/bearish for stocks."

By Robert Prechter (excerpted from the monthly Elliott Wave Theorist; published since 1979)

... If the stock market is not reflecting macroeconomic realities, what else could it possibly be doing? Well, how about political news? Maybe political events trump macroeconomic events.

It is common for economists to offer a forecast for the stock market yet add a caveat to the effect that "If a war shock or terrorist attack occurs, then I would have to modify my outlook."

For such statements to have any validity, there must be a relationship between war, peace and terrorist attacks on the one hand and the stock market on the other. Surely, since economists say these things, we can assume that they must have access to a study showing that such events affect the stock market, right? Continue reading "Don't Get Ruined by These 10 Popular Investment Myths (Part VI)" →

Interest rates, oil prices, earnings, GDP, wars, terrorist attacks, inflation, monetary policy, etc. -- NONE have a reliable effect on the stock market

By Elliott Wave International

You may remember that during the 2008-2009 financial crisis, many called into question traditional economic models.

Why did the traditional financial models fail? And more importantly, will they warn us of a new approaching doomsday, should there be one?

This series gives you a well-researched answer.

Here is Part V; come back soon for Part VI.

Myth #5: "GDP drives stock prices."

By Robert Prechter (excerpted from the monthly Elliott Wave Theorist; published since 1979)

Surely the stock market reflects the nation's Gross Domestic Product. The aggregate success of corporations shows up as changes in GDP. Stocks are shares in corporations. How could their prices not reflect the ebb and flow of GDP?

Suppose that you had perfect foreknowledge that over the next 3 3/4 years GDP would be positive every single quarter and that one of those quarters would surprise economists in being the strongest quarterly rise in a half-century span. Would you buy stocks? Continue reading "Don't Get Ruined by These 10 Popular Investment Myths (Part V)" →

Interest rates, oil prices, earnings, GDP, wars, terrorist attacks, inflation, monetary policy, etc. -- NONE have a reliable effect on the stock market

By Elliott Wave International

You may remember that during the 2008-2009 financial crisis, many called into question traditional economic models.

Why did the traditional financial models fail? And more importantly, will they warn us of a new approaching doomsday, should there be one?

This series gives you a well-researched answer.

Here is Part IV; come back soon for Part V.

Myth #4: "Earnings drive stock prices."

By Robert Prechter (excerpted from the monthly Elliott Wave Theorist; published since 1979)

This belief powers the bulk of the research on Wall Street. Countless analysts try to forecast corporate earnings so they can forecast stock prices. The exogenous-cause [i.e., news-driven -- Ed.] basis for this research is quite clear: Continue reading "Don't Get Ruined by These 10 Popular Investment Myths (Part IV)" →