We Have Found the Indicator, and It is Us (Maybe)
Charles Biderman's crew over at TrimTabs has interesting news for stock market longs:
"The build-up of cash in M2 savings and large-denomination CDs since 2003 and the recent slowing of the real estate market are bullish for U.S. equities," adds Schnapp. During the first four weeks of January, TrimTabs Savings and Investment Flow totaled $75 billion, which was 82% higher than the total during January 2005.
"We have long tracked the Federal Reserve's money supply data, particularly M2 savings," said Charles Biderman, Chief Executive Officer of TrimTabs Investment Research. "While this data is useful over the long-term, its short-term volatility limits its value. We've developed TrimTabs Savings and Investment Flow to measure consumer cash more fully."