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Are Apple shares cheap? Now that they've fallen over 10 percent on the back of Apple's recent product launch, it seems to be a fair question. But even though Apple now has a lower price-to-earnings ratio than do slow-growth companies like Microsoft, Intel, or IBM, Doug Kass says the stock still doesn't present an attractive value.
"Apple has become a value trap," the founder of Seabreeze Partners Management said. "This is a company with no growth, and profit margins that are way too high vis a vis the competition."
Indeed, at its latest media event, Apple disappointed many investors but not releasing a much cheaper iPhone, as some had been pining for. Instead, Apple released more high-end phones that will keep profit margins high, but threaten to do further damage to the company's already-declining market share.
(Read more: At a crossroads, Apple must make one huge decision)
"We remain disappointed with Apple's decision to remain a premium priced smartphone vendor," Credit Suisse analyst Kulbinder Garcha wrote in a note that downgraded the stock to "neutral" from "outperform" after the event. "On our new estimates, Apple's smartphone share will decline to 15.5 percent/13.1 percent this year and next from 18.1 percent last year."
But Kass says that there's a second issue at work: While Apple's prices have stayed high, the company has not delivered innovation to keep pace.
The S&P 500's revenue growth for the fourth quarter is expected to be 1.0 percent, the research company FactSet reports. That might not sound terrible, but if not for a weird quirk in one company's accounting, the expected revenue growth would be more than double that.
The culprit is Prudential. In the fourth quarter of 2012, the insurance giant reported revenue of $46.1 billion, which was almost five times what the insurance giant reported in the fourth quarter of 2011, and amounted to more than half of the company's total revenue for the year.
The revenue surge was due to two "pension risk transfer" transactions, one associated with General Motors and one associated with Verizon. This led to a major increase in revenue in the fourth quarter, but also led to a big boost in "insurance and annuity benefits." Since the benefits were expensed against the increase in revenue, earnings were not impacted like the revenue number was.
But because of the one-time boost, Prudential's revenue in the fourth quarter amounted to a massive 1.7 percent of the entire Q4 revenue for the S&P 500, according to S&P's Howard Silverblatt.
Prudential, then, is expected to show a massive (and misleading) decline in year-over-year revenue in Q4 2013. And that, in turn is dragging down the revenue growth expectation for the entire index. So while the estimated revenue growth rate is 1.0 percent, "if Prudential is excluded, the revenue growth rate improves to 2.2 percent," according to FactSet.
(Read more: Where did earnings go? Profit outlook gets gloomy)
As the Larry Summers news boosts the gold market, December gold futures should be well supported above $1,308.30.
With news that Summers withdrew his name from consideration to replace Ben Bernanke as Fed chairman, gold opened higher Sunday night. This continued the bullish momentum we saw into the electronic close on Friday.
On Sunday, gold traded up more than $25 from its Friday floor close, reaching a high of $1,336. This may look like a monstrous open, since gold closed the floor session on Friday at $1,308.60, but in reality, the electronic session went off just below $1,330, and gold traded less than $10 higher on Sunday night.
As gold's trend line fails, the bears smell blood. And now, $1,285 to $1,280 is in the cards.
Gold plummeted through $1,352 early in Thursday's session, and even found itself trading below its 50-day moving average at $1,331.80 for most of the day. Thursday's floor trading session closed at $1,330.60, but gold finished the electronic session with a bounce off of $1,320, which only served to set it up for a further washout overnight.
(Read more: Gold heads for worst week in 2 months on Syria, Fed)
With an overnight session high of $1,330.80, traders can see how Thursday's floor close and 50-day moving average came back into play as a strong resistance level. When gold touched that level overnight, it gave aggressive bears one last shot to sell.
Gold's low in early Friday trading was $1,304.60, which is below the $1,308.60 retracement-related support level. The momentum is undoubtedly to the downside, and we have consistently said that a close below $1,352 will put $1,300 into the cards within the next session or two.
(Read more: Gold price: 'Last hurrah' may be on its way)
As the S&P 500 approaches a fresh all-time high, what's a timid investor to do? If you're still on the sidelines, economist Robert Shiller thinks that you can still buy in to the market. He would just advise you to take it easy on the bullish enthusiasm.
"I'm not really saying don't invest in stocks," the Yale economist said Thursday on CNBC's "Futures Now." But "don't expect miracles."
After all, stocks might be more expensive that you think. The commonly used 12-month trailing price-to-earnings ratio shows that the market is currently valued at about 19 times earnings—which is only slightly higher than the historical average of 15. But Shiller's cyclically adjusted price-to-earnings ratio (or CAPE) casts things in a different light. CAPE compares the price of the market to inflation-adjusted returns from the prior 10 years, and shows that the market is now valued at 24 times earnings. That is well above CAPE's average reading of 16, and according to Shiller, that means that stocks are now somewhat expensive.
The current reading is "high by historical standards, but it's not super-high," Shiller said. "I'd say it's suggesting—based on historical evidence—real returns of something like 3 percent a year for the next decade."
Shiller says CAPE is "a better measure of price earnings, and it predicts the stock market better than the traditional" P/E ratio. But his metric has recently come under some fire.
In an August piece in the Financial Times ("Don't put faith in Cape crusaders"), Wharton professor of finance Jeremy Siegel wrote: "I believe the CAPE ratio's overly pessimistic predictions are based on biased earnings data. Changes in the accounting standards in the 1990s forced companies to charge large write-offs when assets they hold fall in price, but when assets rise in price they do not boost earnings until that asset is sold."
Instead of using S&P earnings data, Siegel suggests using the after-tax profits reflected in the government's national income and product accounts (NIPA) data. "When NIPA products are substituted for S&P reported earnings in the Cape model, the current market shows no overvaluation," Siegel writes.
In many ways this is a complicated academic argument, but the economists' dueling models have serious ramifications for the average investor. Shiller's belief that the market is relatively expensive leads him to predict that stocks won't move much higher. On the other hand, Siegel's call that stocks are reasonably priced supports bullish calls like the one he made on Aug. 6 on "Futures Now," when he argued that the Dow could easily hit 18,000 by the end of 2014.
(Read more: Siegel: Keep buying—you 'can't lose')
Dennis Gartman told CNBC's "Futures Now" on Thursday that his gold call last month couldn't have been more off the mark.
"I think the stock market has a little bit further to go on the downside, perhaps another 25 or 30 S&P points," Gartman said on the Aug. 22 episode of "Futures Now." "So if I had 'X' amount of money to put to work, I'd put it to work in the gold market."
What's happened since then? To put it bluntly, that turned out to be dead wrong.
From Aug. 22 to Sept. 12, the S&P added 30 points, while gold slid $40. Overall, the metal underperformed the S&P by about 5 percent.
"Clearly I'm wrong on the gold, and there's no reason to be anything other than truthful about it," Gartman said.
(Read more: 'Pre-emptive selling' pushes gold to 4-week low)
"What's happened? Peace, or whatever, has broken out. And peace—or at least a lessening of the discord—is always bearish of the gold market," Gartman said.
Whereas U.S. military action once seemed likely in Syria, the emergence of a credible diplomatic option has changed the odds completely. And since war-based uncertainty tends to boost gold, the smaller chance of a strike took a serious toll on it.
(Read more: More 'innocent victims' if US strikes Syria: Putin)
Gartman also pointed out that gold had been a crowded trade, saying, "A lot of people were bullish, a lot of people were long."
Now that the Syria situation has been moved to the back burner, market participants are refocusing on the same old question: What will the Fed do?
This question is more pressing than it's been in a long time. The Federal Open Market Committee will make its next policy statement next Wednesday. And many expect that when it does, the Federal Reserve will announce a reducing, or "tapering," of its quantitative easing program.
(Read more: Retail investors shrug off fears of Syria, Fed taper)
So will the Fed taper? In my view, yes, a taper is coming—and the better question to ask ourselves is, what will the taper look like? Will it be a $20 billion to $25 billion reduction, or will the Fed take a more cautious route, and only taper down $10 billion or $15 billion?
I believe that the Fed will taper somewhere between $10 billion and $15 billion, and I also believe that this number will mostly be factored in to asset prices already.
It's been quite the run for rates. The 10-year yield has nearly doubled since the beginning of May, and it recently touched 3 percent for the first time in over two years. But according to one top technician, the spike is over—at least in the short term.
MacNeil Curry, head of global technical strategy at Bank of America Merrill Lynch, does think that yields will eventually rise much higher. In fact, on the Aug. 15 edition of "Futures Now," he made the prescient prediction that the 10-year yield was headed to 3 percent. But after that called played out perfectly, Curry has switched.
"We're stuck in a 3 percent to 2.7 percent range" on the 10-year yield, Curry said on Tuesday's "Futures Now."
(Read more: US Treasury yields edge down; focus still on Syria)
After all, he noted that sentiment has gotten remarkably one-sided. Investors have gotten unabashedly bearish on bonds, which move inversely to yields.
"If you look at a whole host of external sentiment providers, by pretty much every metric, we're at bearish extremes which historically lead to a pause, if not a reversal," he said.
Curry sees the same thing when he simply looks at the chart. After all, one needn't be a technical genius to appreciate that the bond market has moved very far, very fast.
Crude oil is sliding on Tuesday, as a U.S. military strike of Syria appears less likely. Russia has proposed that Syria hand over its chemical weapons stockpile, and President Barack Obama has agreed to a U.N. discussion of the proposal.
(Read more: Oil hammered as Syria strike odds fade)
The market is beginning to realize that Obama has an out. At this point, I don't believe there is much of a chance that we bomb Syria, and the market seems to agree with me. We have to remember that this administration ran on an anti-war platform. So does the president really want to go directly against public sentiment and enter into a third conflict? I believe the answer to that is no, and that the crude market will now begin to remove the Middle East premium.
Coffee futures may have gotten roasted over the past two years, but don't expect to pay less for your morning latte. Instead, the drop is seen as a boon for coffee sellers like Starbucks and Green Mountain.
Since hitting a high in May 2011, coffee futures have lost almost two-thirds of their value. In fact, the futures recently hit a four-year low of $1.15 a pound.
Largely to blame has been Brazil. The world's biggest coffee producer and exporter, Brazil produced a record crop in 2012. While the harvest is expected to be slightly down this year, it is still expected to be very large, and another record is expected in 2014.
If there's one company that's been helped by the price decline, it's been Green Mountain Coffee.
The slide in coffee prices has had an "enormous impact" on Green Mountain, said Jonathan Feeney, who covers the company for Janney Capital Markets. "You've seen nothing but top-line misses and enormous beat on the bottom line," because of the increased profits from lower coffee costs.
(Read more: Green Mountain earnings beat, revenue falls short)
And according to research released by Feeney on Monday, Green Mountain's commodity costs are down by 11.3 percent in September, compared with the year prior. "That alone would be inflationary to gross margins by 250 basis points," he said. In other words, Feeney expects the decline he's measuring for the month of September to add 2.5 percent to the company's profits.
After all, Green Mountain is in a "commodity-oriented business," Feeney explains. "It's a product that you just roast and put in a can."
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