• [WEBCAST] Raoul Pal & Neil Howe: A Sobering U.S. Economic Reality Check

    Prepare your portfolio for “big picture” paradigm shifts with Real Vision co-founder Raoul Pal and Demography analyst Neil Howe. Watch the replay from this webcast.

The trend remains the friend of the consumer and discretionary stocks…..

Last weekend we highlighted the trend is gas prices as a potential stimulant to consumer spending or at least the trend might be less bad in the coming months……

I guess it should not come as surprise that confidence among U.S. consumers improved this month from the lowest level in 28 years. The University of Michigan index reportedly reflected a record drop in gasoline prices that gave temporary relief to household budgets.

The average price for a gallon of gas now stands at $1.69, 60% below the peak set in July 2008. Next to Financials, Consumer Discretionary stocks are the most heavily shorted stocks in the S&P 500. Next to Energy, Consumer Discretionary stocks are trading at the lowest valuations of any S&P 500 sector. Short covering rally?

I like continue to think there is some tremendous value in the oversold Casual Dining sector – think EAT and DRI.