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Strategies & Market Trends : Ask Vendit Off-Topic Questions -- Ignore unavailable to you. Want to Upgrade?

To: Vendit™ who wrote (2215)	11/16/2004 9:02:38 PM
From: Walkingshadow	Respond to of 8752

Very nice. If you adjust the time frame of the regression channel between 110 and 250, the slope of the channel changes from up to sideways to down, but the inflection point reached yesterday remains constant. I am also not particularly optimistic about things after the beginning of the year. Notwithstanding the current Bull-mania and the associated gushing hype, there are a lot of economic problems that are simmering on the back burner that sooner or later will come home to roost. My guess is this will take at least 6 months, but the overall picture could get rather gloomy next year. T

To: Vendit™ who wrote (2215)	11/18/2004 7:38:55 AM
From: Walkingshadow	Read Replies (1) \| Respond to of 8752

Here's something amusing.... stock prices are closely linked to ice cream production! Yet another piece of evidence (if any was needed) that Mark Twain was right when he said "There are three kinds of lies: lies, damned lies, and statistics." papers.ssrn.com Is it the Weather? BEN JACOBSEN Erasmus University Rotterdam - Rotterdam School of Management, Financial Management Department/RIFM WESSEL MARQUERING Erasmus University Rotterdam (EUR) - Department of Financial Management Abstract: We show that results in the recent strand of the literature that tries to explain stock returns by weather induced mood shifts of investors might be data-driven inference. More specifically, we consider two recent studies (Kamstra, Kramer and Levi, 2003a and Cao and Wei, 2004) that claim that a seasonal anomaly in stock returns is caused by mood changes of investors due to lack of daylight and temperature variations, respectively. We confirm earlier results in the literature that there is indeed a strong seasonal effect in stock returns in many countries: stock market returns tend to be significantly lower during summer and fall months than during winter and spring months. However, we also show that at best, these two studies offer two of many possible explanations for the observed seasonal effect. As an illustration we link ice cream production and airline travel to the stock market seasonality using similar reasoning. Our results suggest that without any further evidence the correlation between weather variables and stock returns might be spurious and the conclusion that weather affects stock returns through mood changes of investors is premature. Keywords: Stock market seasonality, Sell in May, Seasonal Affective Disorder, temperature, spurious correlations