{"id":18378,"date":"2016-02-27T13:26:48","date_gmt":"2016-02-27T18:26:48","guid":{"rendered":"http:\/\/olduvai.ca\/?p=18378"},"modified":"2016-02-28T09:05:53","modified_gmt":"2016-02-28T14:05:53","slug":"a-blended-fundamental-and-technical-perspective-on-where-we-go-from-here","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=18378","title":{"rendered":"A Blended Fundamental and Technical Perspective on Where We Go From Here"},"content":{"rendered":"
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A Blended Fundamental and Technical Perspective on Where We Go From Here<\/a><\/h3>\n
So I\u2019m currently teaching applied financial modelling at Marquette University in the beautiful blue collar town of Milwaukee, WI; home of the Harley, the (Miller) High-Life and SummerFest.\u00a0 It\u2019s a great town and a great school.\u00a0 A few years ago the business college brought in a pretty savvy guy called David Krause who then started a program called AIM, where the top finance students actually manage more than $2M.\u00a0 Because of the program\u2019s success US News & World Report ranked Marquette\u2019s finance program 21st in the nation this year.\u00a0 Not bad for a small Jesuit school in the midwest.<\/div>\n<\/header>\n
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Now I mention this because after 15 years in banking, teaching financial modeling has forced me to reacquaint myself with some of the basic tenets of markets and valuation.\u00a0 Such things tend to get lost in the midst of \u201cgetting the deal done\u201d and chasing paper profits.\u00a0 This reacquaintance process has been quite illuminating for me and I thought perhaps for others too.<\/p>\n

A reminder of what the market actually represents is a good place to start.\u00a0 The stock market is simply an asset with some intrinsic value based on an expectation of future free cash flows to equity holders.\u00a0 Those cash flows are generated from revenues less costs of the underlying companies that make up the market.\u00a0 Let\u2019s use the Wilshire 5000 Full Price Cap Index as the proxy market for this discussion as it is the broadest measure of total market cap for US corporations.\u00a0 It\u2019s level actually represents market capital in billions.<\/p>\n

\"Screen<\/p>\n

So the market has put a valuation on those expected future cash flows to equity holders (as of today) at around $19.7T (a 55% increase from Jan of 2012) down from around $22.5T (a 77% increase from Jan of 2012) at the market peak last summer.<\/p>\n

…click on the above link to read the rest of the article…<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

A Blended Fundamental and Technical Perspective on Where We Go From Here So I\u2019m currently teaching applied financial modelling at Marquette University in the beautiful blue collar town of Milwaukee, WI; home of the Harley, the (Miller) High-Life and SummerFest.\u00a0 It\u2019s a great town and a great school.\u00a0 A few years ago the business college […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[61,12702,6454,2443,6455],"class_list":["post-18378","post","type-post","status-publish","format-standard","hentry","category-economics","tag-banking","tag-financial-modelling","tag-first-rebuttal","tag-stock-markets","tag-thad-beversdorf"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/18378","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=18378"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/18378\/revisions"}],"predecessor-version":[{"id":18379,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/18378\/revisions\/18379"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=18378"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=18378"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=18378"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}