StockTouch Blog

Apple Selects StockTouch as Top Finance iPad App for 2011

December 9, 2011 by Jennifer

We are humbled and excited to be selected by Apple as the Top iPad Finance App for 2011 via Apple’s App Store Rewind 2011! You can read about it on Yahoo! here, or see the list in iTunes here (click on iPad apps). This is fantastic news. OK, back to work :)

 

Did we hit the housing bottom?

December 7, 2011 by Peter

It’s hard to see the bottom during long-term cycles as they are virtually undetectable in real time. This is due to the fact that they are so loooong and so flat with most market participants loosing interest in the sector, as was the case for stocks back in the early 1980s. Now according to Barclays, the long awaited bottom for the U.S. housing market will come in the year ahead, though strangely enough we think we’ve heard this before.

Barclay’s analyst Stephen Kim points out in this Housing Wire report that the non-distressed home market may have already hit bottom and believes the rest of the market will soon follow.


Kim believes that stability in these prices in the absence of government subsidies is strong signal that home buyer sentiment is improving.  Furthermore, he notes that stabilization in relevant economic indicators such as unemployment and consumer sentiment only strengthens his argument.

Let’s recall December 6, 2006, the date of a previous Stephen Kim research report on housing.

“Citigroup recommended that investors buy shares of homebuilders now as order trends are expected to turn positive in the first quarter of 2007.”

Now having the advantage of hindsight being 20/20 we know that he homebuilders haven’t been so hot since 2007. That being noted, I’m a bit cautious to say we’ve hit the bottom like Kim. As stated in a previous post we believe no twi crises are the same, as such there are a whole slew of new problems that show we haven’t yet reached the bottom. First while Kim points out that rates are low, money still isn’t flowing from the bankers/lenders to buyers which doesnt make it easy to buy. Second prices are still too high. High relative to rents, high relative to median income levels, high relative to other goods historical increases, high relative to building costs…essentially prices need to come down a lot more and Case-Shiller’s HPI futures market are indicating this. Finally inventory is huge in absolute numbers and keeps getting bigger.

Now looking at current market conditions and the haphazard balance sheets of the builders (big piles of debt, loads of inventory that’s not moving, and having more land than Ted Turner), it’s unlikely that the builders’ stocks have reached bottom. As they continue to hold this excess inventory and attempt to unload it, this will continue to prolong the problem, that is until housing supply reaches about 6 months of inventory (which is normal). Investors should also note that the last housing/home building downturn took 17 years to recover to its prior peak level of activity. Not to say we won’t get out of this scenario faster, but if we are to analyze the market in historical terms we need to consider the conditions of the current market, which is a market where lending still hasn’t picked up, where inventory is still too high, and where our best indication on pricing says prices are still too high.

 


 

Looking for good news

December 5, 2011 by Peter

With the current daily news sentiment pandering around endless government debt creation or glorifying being a professional dufus (Google Snooki), we wanted to try and find some “happy thoughts” to help tide you over till the holidays. Now we won’t promise any amazing fixes to the economic problems out there, as we’ve discussed that would require a magician. What we will hypothesize is that the markets could potentially surprise us to the upside as we have apparently discounted a double dip recession, whereas a slowdown might be a more accurate label. According Marshall Aeurback, and investment strategist with Pine Tree Capital, the current economic period might end up being closer to 1998 than 2008. What does this mean? let me explain.

Now the problem with comparing our current economic climate to 2008, is that all crises are created different. While they’re all formed differently, they all share one common element. As best stated by Auerback, crises all share “The inability of markets to perceive that when a market discontinuity is fresh in the minds of investors (e.g., 2008); it seldom repeats until that institutional memory is dissipated.

Most evidence and recent media rants allude to the fact that European banks are insolvent conditional upon the PIIGS collectively being insolvent. It’s pretty obvious for a few, we’re looking at you Greece (although the European Central Bank (ECB) could easily keep them afloat by continuing to buy Greek debt), but for the others, It’s not 100% clear and, particularly in the case of Spain and Italy, it’s more a matter of the rates at which they can borrow at (covered in another previous post). So whether or not the ECB can continue to provide a safety net of liquidity, the real problem is growth in Europe which is lacking. The Euro Zone is already looking like it’s slipped into a recession whether it cares to admit it or not. Aeurback would argue that this recession, as opposed tosystemic risk and bank runs, is already priced into European stock markets.

While the current crisis in Europe is worse than the 1998 crisis with LTCM and Russia, in 1998 it was thought that the entire system would collapse. Remember in 1998 Fed funds were 5%, not zero; 10-year notes, above 4%, not 2%+; 2-year notes were 5%; SPX was 30x earnings, not 15x. We had not gone through a 1974-style liquidation in reverse parabola terms except for the one day 1987 sell-off, as we did in 2008–2009. Real estate was not selling for prices yielding 10%–15% on lower-end real estate, but that is where the focus of foreclosures is felt. With all this said, according to Auerback, “The story will be told in the next eight trading days.” So while there is still a 100% chance we see some continuing strain on the markets moving forward this week. There is also a chance it’ll be far less 2008 like and a little more “bear”-able and 1998 like. So when looking for opportunities in the market the next couple of week, remember that we’ve seen these conditions before.

Does Houdini have a trick for this?

December 2, 2011 by Peter

With a growing number of countries looking to, or having already used some sort of policy maneuver to bail themselves out and increase their national debt. How do we know when we’ve reached a limit on the debt we can handle? Or are the Keynesian right and can we just keep spending?

In a recent letter to investors (available here) Kyle Bass of Hayman Capital, calls the current economic climate, “a conclusion to the global debt super cycle.”

His thesis is simple; the world is “saddled with too much debt”.

He explains that since 2002, “total global credit market debt has grown at more than an 11% compound annual growth rate (“CAGR”) from $80 trillion to approximately $200 trillion. Over the same time, global real GDP has only grown at approximately a 4% CAGR

He finds that right now, total credit market debt is 310% of GDP. This means that we are “saddled” with the largest accumulation of peacetime debts without much of an idea of what to do next according to Bass. If you look back at history, whenever total credit market debt breached 200% of GDP, it was usually due to deficit spending fueled by borrowing as nations prepared for and then fought wars. To the victor went the spoils (and debt pay-downs) and the loser got their cities turned to rubble and a crappy credit score (they defaulted on their debt). Given the enormity of the debt burdens of the PIIGSBF (Portugal, Italy, Ireland, Iceland Greece, Spain, Belgium and France) coupled with those of Japan (and at some point the US), lending schemes designed to lend more into an intractable debt problem according to Bass “are destined to fail miserably.” Bass eventually goes onto state “There is no savior large enough with a magical pool of capital to stave off this unfortunate conclusion to the global debt super cycle. We think hard defaults are imminent.

Bass’s argument, that eventually no one will be able to pay off their debt is certainly alarming. But in an economic environment where borrowing rates are near zero, theoretically couldn’t the debt be carried indefinitely? If we continue holding rates low, which seems to be the plan of the central banks, then the problem is not the size of the debt but the interest service it carries. Where the true obligation lies is with what is payable to the private sector and outside sovereigns debt holders. What is worrying then is for countries with large debts, a slight change in borrowing rates could cause their ability to meet debt obligations to private sector and sovereign holders (private markets), to plummet.

Continuing to pile on the pressure, Gary Shilling of A. Gary Shilling & co, thinks we will see defaults in the private markets (check out this video). Shilling’s states that, “the sovereign crisis is a symptom of the underlying loss of purchasing power by global populations.” Shilling sees the world entering, a “deleveraging in the private sector.” For us simpletons this is called deflation, or for Bass, “a conclusion to the global debt super cycle.” Deflation or a super cycle ending would then dry up private markets through a loss of purchasing power. The loss of purchasing power would force the government to increase yields on its debt to attract investors. An increase in yields would cause governments to default on both private and public debts, as they struggle to meet higher debt service obligations. So in conclusion, Bass and Shilling agree, we’re already beyond help. With both public and private credit markets drying up, we don’t have many options if we keep operating under the status quo. Unless of course the debt magically disappears, but we’d need Houdini for that and he’s got his own problems.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Can the central banks actually pull this off?

November 30, 2011 by Peter

It seems every major financial media outlet is covering (as they should), the move by just about all of the world’s central banks on a coordinated intervention to lower swap rates. In laymen’s terms, European banks have been parched for liquidity, and need access to dollars. The ECB can’t supply dollars unless it borrows them from the Fed. So today’s action makes it easier for the ECB and thus European banks to borrow dollars. This is by no means a solution to the “crisis” in the EU, it simply will just help solve small liquidity problems for the time being.

The markets as well are LOVING this move. US futures had been down by 0.5% at one point this morning, and now the Dow is up 400 points.

**Note that there are some other bullish things going on today. China lowered its Reserve Requirement Ratio also this morning, and we got a strong ADP jobs report.**

 

While this move may be a positive short-term development on its own it doesn’t do much in the long term”, writes Pimco CEO Mohamed El-Erian in an FT Alphaville column after the announcement.

 

Supporting “the supply of credit to households and businesses and help[ing] foster economic activity” may be a nice goal, but it’s not one the banks can achieve with these current measures:

 

“First, these monetary institutions feel that, again, they have to move because other entities have continued to be too slow and too ineffective; and second, they feel that they cannot, and should not ignore an actual or anticipated need to relieve acute pressures within the banking system…

The hope is that central banks are acting because, looking forward, they feel confident that other policymakers will finally catch up with a big and spreading debt crisis that has serious implications for growth, jobs and inequality. The fear is that they are acting because they feel that they must again pre-empt yet another set of potential disappointments.”

 

And from another part of the Pimco Empire Tony Crescenzi, shares the idea that this is another round of QE via the backdoor.

Keep in mind that any use of the Fed’s swap facility expands the Fed’s monetary base: all dollars, no matter where they are deposited, whether it be Kazakhstan, Japan, or Mexico, wind up back in an American bank. This means that any time a foreign central bank engages in a swap with the Federal Reserve, the Fed will create new money in order to make the swap. Use of the Fed’s liquidity swap line in late 2008 was the main cause of a surge in the Fed’s monetary base at that time. The peak for the swap line was about $600 billion in December 2008. Some observers will therefore say that the swap line is a backdoor way to engage in more quantitative easing.

Now both these men pose that this is all just smoke and mirrors essentially to keep the markets happy another month or to push a political agenda. But it gets us wondering if the Pimco gentlemen are just throwing cold water on an equity rally to get the public back to buying bonds, or if they’re actually right.

Why Germans aren’t so crazy about the idea of a Euro Bailout.

November 29, 2011 by Peter

As the clock continues to tick on Europe, like everyone else we’ve been wondering what the options are. Henry Blodget at Business Insider and Gavyn Davies at the Financial Times have both done a good job laying out several. One they both share, and one that’s been getting a lot of attention is the idea of a bail out. With all the countries in Europe seemingly in trouble, why hasn’t this happened?

Well Germany doesn’t want to play nice it seems. First they don’t even believe there is a Euro Crisis going on. Specifically Jens Wiedmann, the head of the Bundesbank (Germany’s central bank), in an interview with The Financial Times said he “doesn’t really see a euro crisis, but rather a series of individual, idiosyncratic crises in the various countries that have gotten into trouble.” When questioned on the responsibility of the European Central Bank he said its, “to ensure price stability and to support the competent authorities in ensuring financial stability”.  Which doesn’t scream bail out, it sounds a lot more an Austrian motive (economic theory).

So what’s going on? Do Germans really think there isnt a crisis? Well Germans are opposed to a bail out for two main reasons regardless of the validity of a crisis. First politically, an ECB bailout would be suicide for German politicians. Germans are culturally hardworking (or so they claim) and very judgmental of their neighboring countries for being “lazy”. For a German politician to bail out their “lazy” neighbors would not be a good idea for re-election.

Second, the German economy for the past 10yrs has relied on exports and low wage growth for stability. Thus Germans are terrified that huge ECB intervention would trigger massive inflation that would destroy the value of the Euro and cut their wages.

The challenge then for Germany is how to save the Euro without causing massive inflation. Germany needs/likes a weak Euro. A weak Euro helps with trade, and keeps inflation low, which is good for German workers and the countries economy (Germany has the lowest real wage growth in the Euro). If Germany allows the Euro to die, it will have to default to Mark which will be a strong currency (as compared to the Euro) that erodes its competitiveness and wages. Perhaps in some sinister way, Germany needs Greece, Italy and Spain to continue to devalue the Euro, which balances the currency rise and keeps Germany competitive.

What could a rise in German Yields Mean?

November 27, 2011 by Peter

 

The chart above from Morgan Stanley claims for the first time that the economic rock of the Eurozone, Germany, has its bond yields moving up. So what?

In a recent article by Joe Weisenthal over at Business insider, the claim is made that yields have risen, due to the “failed” German bond auction last Wednesday. He warns that higher yield could suggest the bond auction “failure” was not a technical matter, but a reflection of a possible credit risk in Germany. This is concerning as Eurozone stress was previously associated with lower German yields, while investors flocked to German notes from periphery debt filled countries for safety.

Now the mere rise in yield is not an alarming event in itself, but when coupled with a miserable bond auction, suggests that investors are loosing faith in the entire Eurozone, of which Germany is/[was] the safety net that held it together. This now results in a BIG issue, who can save Eurozone? Germany? The European Central Bank (ECB)?

Next week we have several more Eurozone countries auctioning off about $26bn in debt, if this trend keeps up things could get scary.

App Central Video Review

November 16, 2011 by Jennifer

Canadian TV show App Central reviews StockTouch. It’s the first app reviewed in Episode 8.1, which you can view here.

Beginning, Middle, End.

November 7, 2011 by Jennifer

Steve Gillmore ruminates, in his characteristic stream of conscious brilliance that I can barely understand (but I know I need to, even as it wobbles between insight and incoherence), on the “…Appification of the computer, web, and media…” in his latest TechCrunch missive:

“When app gets the network it becomes the sum of all its parts, aware of its possibilities, able to provide the contours and context of what feels like a coherent entity. My mind feels comforted by the notion of the app, like hot chocolate after a day on the ski slope. Some place to go, beginning middle end. Yet I want the potential for disruption, the harnessing of those great minds out there signaling on the social stream, the drumbeat of serendipity orchestrated while I savor a good book. Discovery by design.”

I especially agree with his comment that an app gives you “some place to go, beginning middle end.” This is something we’ve thought about a lot in building StockTouch – the power of an app that has focus, that you know you want to use for a specific purpose. And that the app is the best possible thing to use for that focused purpose. In the case of StockTouch, it’s monitoring the market. In the case of the StockTouch of the future, it will be monitoring the market, and monitoring things you care about.

We’ve worked really hard to build something that feels like it was made by people who really, really care. As always, we love to hear from you, our customers, so please email us, or zap us a message on Twitter, Facebook.

iPad Today

October 27, 2011 by Jennifer

iPad Today is a show on TWiT.TV hosted by Leo Laporte and Sarah Lane. Today they talked about finance apps, and StockTouch was profiled. They really took the time to understand the app and demonstrate how it can used as a mood board of the markets, as well as a way to watch stocks that you care about.

StockTouch appears from 15:00 – 20:00.

View the show »

Favorites

October 14, 2011 by Jennifer

Version 1.3 of StockTouch introduces a new feature we are calling Favorites. This feature gives you the ability to mark stocks on our heat maps (currently U.S 900 and Global 900 stocks), and easily view or hide the stocks that you have marked. This is our first baby step towards offering more powerful and flexible Watchlists. By no means are we done; consider this feature a small taste of where we want to take customization.

You favorite a stock in an obvious place: on its main screen. On the iPad you will see a Favorites icon in the upper right of a given stock’s screen, and on the iPhone it will be oriented slightly more towards the top center of the screen:

Favoriting stocks is as simple as touching that little icon. Now that you’ve started favoriting stocks, they are remembered by the app, and quietly stored in iCloud so that they will also appear if you open StockTouch on another device that is linked to your AppleID. For example, if you Favorite your stocks on your iPad, the next time you open up your iPhone, they will magically appear on the screen. Note that you need to be using iOS 5 on both devices for this quiet syncing over iCloud to work. If you are not using iOS 5, your Favorites will still work, but they will stay on your device and not utilize iCloud.

After you pinch to zoom back out of Level 3, you will notice that the screen has changed slightly. Your Favorites now stand apart from their peers slightly. The interface still looks and behaves the same way, but we’ve added some subtle effects that lift your Favorites off the screen and enable you to quickly identity them among the 900 other stocks on the screen.

Favorites can be easily turned on and off by touching the star in the menu on the right side of the screen (for both iPad and iPhone versions of the app). This menu allows you to show/hide both your Favorites and market indices.

When your Favorites are turned on, you can surf through the app to your heart’s content, and these stocks will also being quickly identifiable amidst the noise of the markets. It’s particularly helpful to see how your Favorites rank compared to their sector peers over a given time period, and even additionally against the S&P 500. Here’s an example of how Apple, Microsoft, Google and Salesforce.com have fared vs. the S&P amidst their sector peers, over the past six months:

We hope you enjoy this important new feature in StockTouch, and as always encourage you to contact us with your feedback at support@stocktouch.com, on our Facebook page, or via Twitter.

 

 

 

 

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Xignite

by Jennifer

We use Xignite as a data provider for our app, and have appreciated the ability to quickly add data and information to our app by tapping into their user-friendly APIs. The love goes both ways evidently :)

@ is my favorite financial iPad app. (powered by #xignite)
@sdubois
Stephane Dubois

New Feature: Winners

October 9, 2011 by Jennifer

Version 1.2 of StockTouch is now available in the App Store, and one of the features that we are really excited about is a feature we call “Winners.” It gives you the ability to instantly sort companies by percentage gain/loss to viscerally view top performers. To use it, touch the Arrange menu and choose Winners:

If you are already viewing price, what you will see is a descending array of stocks within each sector that places the top gainers in the upper left and arranges the subsequent gainers sequentially across and below within that sector, in lexigraphical order:

Another interesting approach is to cross reference price performance with volume. You can do this by viewing a given sector (or all 900 companies) in Winners mode, and switching back and forth between Price and Volume. Here’s an example using the Tech sector, in 1 week time mode:

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Pain Served Four Ways (with a little consolation)

October 3, 2011 by Jennifer

Another down day in the markets. The first day of Q4, concerns about the European debt crisis, and Bank of America’s continued woes eventually pulled down a mixed market into deep loss territory. At the end of the day, StockTouch looked like this:

If you prefer your pain served up in a more organized way, you might like our new view (not yet in the app) which allows you to arrange winners and losers of a given measure (in this case price) in lexigraphical order:

Another interesting way to view the mayhem, which we hope lightens your load just a touch, is our new “vs. S&P 500”  which provides a nice signal to noise filter on a day like today. At least now you can see who’s outperforming and underperforming the broad market movement. Consolation prize: larger cap companies in Consumer, Services, Technology and Utilities outperformed their smaller cap peers, except in Finance, where B of A and Citigroup led the negative charge:

And finally, a picture of symmetry that hopefully provides some balance and hope in the midst of another painful down day in the stock market. This is the “vs. S&P view” combined with our not-yet-in-the-app view of winners and losers in lexi order:

 

Gracias.

September 27, 2011 by Jennifer
Blown away by the new @ app for iOS. They've done some incredible data visualization work with real-time stock market data. Wow.
@thedelk
Ryan Delk
@ Absolutely love your app. Quickly becoming a powerful & valuable tool for me. Thank you!
@boseyjones
josh appel

Tutorial: Display vs. S&P 500

September 23, 2011 by Jennifer

A nifty feature included in the latest update to StockTouch enables you to benchmark your view of StockTouch relative to the S&P 500. This is something that our customers have requested since we launched in the end of June, and we are happy to bring it to life in this latest update. You access this capability via the Display menu on the right sidebar of the app (see image to the right).

Viewing stocks relative to the S&P 500 (or any other index for that matter) is especially valuable when the market is moving up or down as a whole. For example, on Wednesday September 21 the market was sharply down across the board. StockTouch as a whole was showing an impressive amount of red. As a matter of fact, only 26 out of 900 stocks in our U.S. view gained more than .5%. So looking at StockTouch without any filtering gave you a sense of a market in distress.

But which stocks outperformed and underperformed the S&P? This became much more salient, and even patternistic, with our new feature:

Note how much more obvious it is that Finance, Materials, Industrial Goods and Energy were underperforming the S&P 500. Also, note how Technology did its best to hang onto some decent numbers, while Utilities held up (relatively) well, possibly due to demand for dividend yielding stocks.

This feature is useful not only intraday, but looking out across longer periods of time. Enjoy, and as always, please don’t hesitate to let us know what you think.

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Tutorial: Display Price, Volume, vs. S&P 500, vs. Sector

September 21, 2011 by Jennifer

Here’s a short video that walks you through the basic display of price, volume, vs. S&P 500 and vs. sector in StockTouch, with an eye towards understanding how benchmarking off the S&P 500 can be very helpful on days (or periods of time) when the market is uniformly up or down.

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Twitter Love from @DuaneKing

September 8, 2011 by Jennifer
Watching stock market trends has never been better. Art meets science in @. http://t.co/Q4bTuox #datavisualization
@DuaneKing
King, Duane

Restarting the App

September 7, 2011 by Jennifer

Here’s a quick explanation of how to restart StockTouch on an iPad.

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So What

August 24, 2011 by Jennifer

We appreciate data visualization in all its forms here at StockTouch. Check out this thoughtful combination of Miles Davis’ seminal song “So What” with its animated sheet music. Via Kottke.org.

Here We Go Again

August 18, 2011 by Jennifer

Here we go again. Another global selloff on concerns about the global economic forecast, European woes and the U.S. job market. The Dow is down 4% at the time of writing, and StockTouch is showing the pain.

iShares likes StockTouch

August 11, 2011 by Jennifer

iShares Managing Director Sue Thompson talks about her favorite financial iPad apps, and StockTouch makes the cut. Thanks for the props! It looks like her iPad was off the network during the video shoot, as our time series graphs didn’t show up when she dove down into Apple Computer’s screen, but that’s ok. It’s gratifying to see that people are noticing the power and utility of our app.

Two Historic Days

August 10, 2011 by Jennifer

Two unbelievable and historic days of market gyrations in response to S&P’s unprecedented downgrade of U.S. government debt. Monday August 8th saw a 5.5% drop in the Dow Jones Industrial Average, followed by a 3.98% rise on Tuesday August 9th in response to the Federal Reserve’s announcement that it will keep short-term interest rates near zero through at least the middle of 2013.

This time-lapse video was created by taking successive screenshots of the StockTouch iPad app at 1-minute increments during both trading days.

Bloom and Retreat?

August 9, 2011 by Jennifer

Earlier today we posted an image that showed how the early rally in prices bloomed from the large cap stocks out into smaller cap stocks within each sector. Now at 2:31pm EST you’ll notice how there’s been a slight retreat from the center of each sector once again. A bloom and a retreat? Here are the two images, one after the other:


A Break in the Clouds from the Center

by Jennifer

The markets opened immediately up, with rumors that the U.S. Federal Reserve will be giving an assist to the economy, and word that insiders are buying. Whatever the talk is, it’s very clear from the patterns in StockTouch that larger cap stocks in each sector are benefiting first. Notice how the green is blooming from the center. This is within five minutes of the market opening.