Author Archives: Brian Johnson

About Brian Johnson

I have been an investment professional for over 30 years. I worked as a fixed income portfolio manager, personally managing over $13 billion in assets for institutional clients. I was also the President of a financial consulting and software development firm, developing artificial intelligence based forecasting and risk management systems for institutional investment managers. I am now a full-time proprietary trader in options, futures, stocks, and ETFs using both algorithmic and discretionary trading strategies. In addition to my professional investment experience, I designed and taught courses in financial derivatives for both MBA and undergraduate business programs on a part-time basis for a number of years. I have also written four books on options and derivative strategies.

ECRI Cries Wolf – Again

Posted on May 30, 2013 by

The Economic Cycle Research Institute (ECRI) is one of the leaders in business cycle forecasting, but they had one spectacular and very public forecasting failure in the fall of 2011 – when they predicted an imminent U.S. recession. Until that … Continue reading →

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S&P 500 Overvalued Based on Price to Sales Ratio

Posted on May 23, 2013 by

In a recent article “Earnings-Price Divergence Always Followed by Negative Returns,” I noted that every extreme divergence (-20% or lower) between year-over-year corporate profits and equity prices in the past 50 plus years was followed by negative year-over-year equity returns.  … Continue reading →

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Recession Models Indicate Risk Remained Low in April

Posted on May 16, 2013 by

The following article updates the diffusion index, recession slack index, aggregate recession model, and aggregate peak-trough model through April 2013.

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Posted in Economic Indicators, Fundamental Analysis, Recession Forecasting Model | Tagged , , , , , , , , | 1 Comment

Warning – The Perils of Annuities

Posted on May 9, 2013 by

The concept is simple: write a single check to an insurance company and receive monthly income for the rest of your life, even if you live to be 100.  No more worries about market crashes, bursting bubbles, interest rate fluctuations, … Continue reading →

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Non-Farm Payroll (NFP) Model Forecast – April 2013

Posted on May 2, 2013 by

This article presents the Trader Edge aggregate neural network model forecast for the April 2013 non-farm payroll data, which will be released tomorrow morning.

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Posted in Economic Indicators, Fundamental Analysis, NFP Forecasting Model | Tagged , , , | 2 Comments

Q1 2013 GDP Model Forecast Below Consensus Estimate

Posted on April 25, 2013 by

In January, I introduced a new aggregate neural network model that I developed to forecast the seasonally-adjusted, annualized, real rate of change in U.S. GDP.  The GDP growth rate is only reported quarterly, but the model provides a new rolling … Continue reading →

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GDP Model Forecast Improves in March

Posted on April 21, 2013 by

In January, I introduced a new aggregate neural network model that I developed to forecast the seasonally-adjusted, annualized, real rate of change in U.S. GDP.  The GDP growth rate is only reported quarterly, but the model provides a new rolling … Continue reading →

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Earnings-Price Divergence Always Followed by Negative Returns

Posted on April 14, 2013 by

I recently wrote about the extreme divergence between earnings and equity prices, but did not have access to comprehensive historical earnings data until recently.  In the article above, I referenced the past few years of earnings data, which was provided … Continue reading →

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Posted in Economic Indicators, Fundamental Analysis, Market Commentary, Market Timing | Tagged , , , , | 5 Comments