There are three negative inputs to the current market action.And one ginormous positive.From my seat, the positive gives the bulls an edge.

It seems there will be no stimulus anytime soon.Depending on the election, it may be months before a new one is agreed.This a risk that has not been priced into the market yet.

The Chicago Fed's National Activity Index is pointing towards more growth.South Korea has emerged from its recession.The weekly charts for the larger indexes show double-tops, which probably means the 4Q20 will be a tough trading environment.

We have a perfect storm on the horizon that is approaching fast.Election turmoil, another wave of the pandemic, and an economy absent needed stimulus are the three fronts of this storm.The market implications between now and year end are a correction at best and another bear-market decline at worst.

With record economic growth and hiring this summer, we may soon learn that the recession is already technically over.But the end of the recession doesn’t mean the economy has recovered, only that the worst is behind us in terms of lost economic output, income, and jobs.Expect the recovery in GDP to take another year, while regaining the lost jobs to take closer to two years. Getting back to the former trajectory will take longer still.Investors should be mindful that the path forward will be slow and uneven, even after the recession is declared to be over.

This is probably the first recession that inflated rather than popped financial asset bubbles.Panicked governments and central banks are dumping trillions of play-money dollars into the system, a big part of which flow directly into the brokerage accounts of the 1%.Another effect of long equity bull markets is a growing population of companies that are only viable in the easiest of easy money environments.

Initial claims for regular state unemployment insurance totaled 787,000 for the week ending October 17, down 55,000 from the previous week's revised tally of 842,000.The number of ongoing claims for state unemployment programs totaled 8.982 million for the week ending October 3, down 1.22 million from the prior week.The total number of people claiming benefits in all unemployment programs including all emergency programs was 23.150 million for the week ended October 3, down 1.046 million from the prior week.

What the VIX futures are telling us.What the market is telling us about election expectations.Using options to take advantage of market uncertainties.

The flip side to this is that what we are seeing is catchup purchases by consumers and inventory repletion by businesses.I'm of the opinion what we are seeing is simply a snapback in spending due to repressed demand but these levels will fall.A certain level of inventory is always required to run an efficient goods-to-consumer pipeline.

Historical data on average one-year, five-year and fifteen-year returns for the S&P 500 since 1871, with all dividends continuously reinvested.Historical data on the range of returns for one-year, five-year and fifteen-year holding periods.History’s shocking surprise about risk and returns.

We've clearly never been here before - no one has ever tried to lock down an economy then restart it again. We thus don't know how it all works, we're hoping.We have a decent enough basic structure to use as a logical base but there are definitely things we still don't know in any detail.Further, we've definitely got a change in what we can do and how as well as in just a recession.

Five of the eight broad PMI sectors showed signs of recovery from July.Technology and Consumer Services lag, while Telecommunications Services sees second downturn.Consumer Services, Telecommunications Services, Industrials and Financials likely to be hit hardest by further lockdowns.

The dollar is consolidating yesterday's losses.Equities are lower, and benchmark yields are little changed.The S&P 500 is trading a little lower following yesterday's 0.2% decline.Gold rose almost 1% yesterday, the most in a couple of weeks, on the back of the weaker dollar.WTI for December delivery slumped 4% yesterday and slipped below the $40-mark and straddled today.

In response to the global COVID-19 recession, central banks across the world unleashed synchronized monetary stimulus to backstop the economy.With the lack of inflation pressure, and higher tolerance for inflation overshoots, central banks globally are likely to keep interest rates low for a long time.Today’s low-interest rate environment creates some challenges for investors looking for adequate returns through bonds, but great opportunities for borrowers and equity investors.

The cry is almost unanimous around the world - governments, in this age of pandemic and economic recession, must open up the government spigots and stimulate their economies.The "shock" of the coronavirus pandemic, throwing economies into recession and creating financial distress, seems to be the culmination of sixty years of credit inflation.The next five years or so, will be a time of rebuilding, both the economy and the ideas about how the economy works, so that we may construct better policies.