Derek Moore reflects on market reaction to the 2011 US debt downgrade and explains what S&P, Fitch, and Moody’s have for ratings. Plus, are markets poised for more positive returns based on several indicators? The bear case against the markets would be a reduction in profit margins. Later, Derek reviews some data of future 12-month returns when consumer confidence is low as a contrarian indicator. Finally, looking at several current indicators and random musing in markets for clues about the future. All that and more this week.

S&P 500 Index net profit margins for Q1 2025

Consumer confidence and consumer sentiment are low but is that a good thing?

Looking at how often intra year lows on average are -14% but often markets end higher

12-month inflation expectations are now 7.3% highest since 1981

Hard vs soft data

Velocity of M2 Money Stock

What has been working asset class wise in 2025 YTD

15 biggest rallies since 1950 and subsequent forward total returns

Atlanta Fed GDP Now

Investment banks starting to reduce recession probabilities

Attribution of earnings EPS growth

DeGraaf and Zweig Breadth Thrusts occurring within 1 month of each other

Explaining the difference between Moodys, Fitch, and S&P bond ratings

Moodys downgrades US Debt

Mentioned in this Episode

Derek Moore’s book Broken Pie Chart https://amzn.to/3S8ADNT

Jay Pestrichelli’s book Buy and Hedge https://amzn.to/3jQYgMt

Derek’s book on public speaking Effortless Public Speaking https://amzn.to/3hL1Mag

Contact Derek derek.moore@zegainvestments.com