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Thanks for your email.
One of the traders send me this chart that he developed and a description of
what the M3 looks like on top of the SP500. It was published at
www.markethistory.com
"... This seasonal plot shows that Money Supply Growth
contracts on a seasonal basis during June and July. Since the Fed has
been raising rates of late, this seasonal curiosity in Money Supply seems
quite interesting. The graph projects the seaonal pattern forward to show
what money supply would look like if it behaved according to the
seasonals going forward in the year 2000. Then we put a simple line chart
of the S&P 500 on top of the money supply graph. If you find the green
arrows on the chart, you can see where peaks in the supply of money seem
to fit together with peaks in the S&P 500. ..."
It's pretty easy to run this through a cross-correlation workbook to get the
lag time and stats.
Best regards
Walter
Attachment Converted: "f:\eudora\attach\M3_SP500.gif"
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