The Market Continues to Ride the Wind

A healthy market, according to the fundamental and technical watchers of yore, climbed a "wall of worry." Right now, our equity markets continue to ignore both poor macroeconomic and corporate developments in ways that resemble the already forgotten 2006 period.

Looking at our own economy, what are some of the facts we've discounted?

• According to Fed presidents, the labor markets remain weak, unhealthy, in flux or whatever euphemism is acceptable to the Yellen regime;
• The housing "recovery" has stalled, weakened, sputtered.
• The Fed won't tie monetary policy to rules, but some Fed Presidents feel that rates may rise sooner rather than later. 
• Our larger, more concentrated banking sector is shelling out billions in shareholder equity to the government without admitting any crime they've committed.  Meanwhile, their fundamental businesses, with some lending growth, are lackluster.
• Trading revenue continues to flounder for the investment banks.
• Top line revenue continues to be hard to come by, and earnings gains continue to be of low quality, especially in the tech sector, where retirement plan commitments are excluded from "normal" earnings.

Let's move to Europe, where strategists have said the better values were from the fourth quarter of 2013.

• From daily press releases, Chancellor Angela Merkel has gone missing, to be seen only at the World Cup in shades suddenly becoming a fan of the Champions.  
• Is anyone still in the Elysee Palace?  
• Britain put on a dismal performance at the World Cup, but the semi-comatose Roy Hodgson declared satisfaction with his efforts. The British economy seems to be like a Morris Minor with vapor lock.  
• The Russian wolf is reconstructing his empire a bit at a time, alternatively threatening and blaming vast Western conspiracies.  Merkel and Hollande have gone from hectoring the EU periphery to becoming like pet poodles to the Russian wolf. 
• No one knows what's going on in the EU banking sector, and Banco Espirito Santo wasn't on anyone's top ten list of troubled banks, but they are shown to have no clothes. 
• What will a cold winter do to Russian gas prices coming through Europe?  

In the rest of the world, there's a mixed bag at best.

• China's hoarding of raw materials seems to be an expensive and inefficient use of their assets.  Growth rates continue to be strangely high and no one seems worried.
• India's elections were won on an anti-corruption platform, but what's really needed now is a pedal to the metal for infrastructure construction to match the pace of construction (much not completed) growth, apartment and condo development, and new corporate parks.  This will be impossible due to the corrupt program of rural subsidies to buy votes.  Economic policy for the past five years under the former Congress regime was an unmitigated disaster.
• Brazil hosted a World Cup, spent $11 billion or so, and gave up their veneer of artistic and technical supremacy in the beautiful game.  The corporate environment is rife with inefficiency and corruption, the state enterprises leading the way.  Interested in issues of inequality?  Take a walk in a favela---with armed guards and an armored car, though.  
• The Middle East has finally begun to be redrawn.  No one knows how it will settle out, and what the costs will be, especially for the U.S. and Israel.  Normally, this should cause some alarm. Not for these heady markets.