Constructing the Monetary Model by Martin Zweig

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Old Feb 17, 2006, 5:06pm   #1
Joined Nov 2005
Question Constructing the Monetary Model by Martin Zweig (US Markets)

Hello!

I have read Martin Zweigs book Winning On Wall Street and liked it very much. Now Im trying to construct the Monetary Model, which he developed, but I got stuck.

The Monetary Model is constructed from Prime Rate Indicator, Fed Indicator and Installment Debt Indicator.

Prime Rate Indicator:
This was not much trouble to find.

Fed Indicator:
This indicator is constructed from discount rate, federal funds rate and reserve requirements.

Discount Rate and Federal Funds Rate:
According to Zweig, both the discount rate and the federal funds rate serve basically the same function so he uses changes in either rate for calculating the Fed Indicator.

One useful site that I found publishes Primary rate, Secondary rate and Federal Funds Rate. The Primary and Secondary rate are not mentioned in his book, so I wonder, which of these should I use?

Reserve Requirements:
I have no idea where to find this data. A quote from his book:
Quote:
"To calculate the Fed Indicator, you must grade the discount rate and reserve requirements separately. Then their scores are combined. In the following examples, Ill stick with just the discount rate, but the rules would work exactly the same for reserve requirements. (At this writing, the Fed hasnt touched reserve requirements since the fall of 1981.)"
I would very much appreciate if someone could direct me to somewhere, where I can obtain this data.

Installment Debt Indicator:
I understand, for what is it used, and that it is reported once a month, but again, I dont know where to find the numbers.

Any help is appreciated and when the Monetary Model Worksheet is completed (MS Excel format) Ill gladly share it with you.

Happy trading and thanks!

Last edited by pirx; Feb 17, 2006 at 5:29pm.
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Old Mar 2, 2006, 6:36pm   #2
Joined Nov 2005
pirx started this thread This has taken a lot of time, but my interpretation of the Market Model is now constructed and available in the attachment.

There are some Slovenian comments in the cells, but you can simply delete them. The requested data also needs to be entered, but this is the least

Enjoy.

UPDATE:
The attachment now contains all of the existing conditions for March 2006.
Attached Files
File Type: xls Zweig Super Model.xls (54.0 KB, 1504 views)

Last edited by pirx; Mar 5, 2006 at 9:01pm.
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Thanks! The following members like this post: royallap
Old Jul 12, 2006, 4:03pm   #3
 
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Downloaded your Zweig model. Thanks.
Could you summarize where you get all the data in the model?

Thanks again
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Old Jul 12, 2006, 9:15pm   #4
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pirx started this thread
Quote:
Originally Posted by royallap
Downloaded your Zweig model. Thanks.
Could you summarize where you get all the data in the model?

Thanks again
Hello! I hope you find it usefull.

Since there are too many links to copy/paste, I suggest you to try some googling. If you wont find all of the sources, let me know, and Ill help.
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Old Aug 16, 2006, 8:34pm   #5
 
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INstallment debt

How to calculate the Consumer Installment Debt? For example, in his book, the number 3/18/74 is $145.55 Billion. But the http://www.federalreserve.gov/releas...c_hist_nr.html
it shows on January 1974, the number was $191.222 Billion. Do you know where this $145.55 Billion came from? Thank you for help.

Quote:
Originally Posted by pirx
Hello! I hope you find it usefull.

Since there are too many links to copy/paste, I suggest you to try some googling. If you wont find all of the sources, let me know, and Ill help.
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Old Aug 16, 2006, 8:39pm   #6
 
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question about consumer installment debt

How to calculate the Consumer Installment Debt? For example, in his book, the number 3/18/74 is $145.55 Billion. But from the http://www.federalreserve.gov/relea...cc_hist_nr.html
it shows on January 1974, the number was $191.222 Billion. Do you know where this $145.55 Billion came from? Thank you for help.


Quote:
Originally Posted by pirx
Hello! I hope you find it usefull.

Since there are too many links to copy/paste, I suggest you to try some googling. If you wont find all of the sources, let me know, and Ill help.
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Old Aug 17, 2006, 5:48pm   #7
Joined Nov 2005
pirx started this thread
Quote:
Originally Posted by viamlvictor
How to calculate the Consumer Installment Debt? For example, in his book, the number 3/18/74 is $145.55 Billion. But from the http://www.federalreserve.gov/relea...cc_hist_nr.html
it shows on January 1974, the number was $191.222 Billion. Do you know where this $145.55 Billion came from? Thank you for help.
The difference is small enough, so dont worry

But, the truth is, that I dont know from where the difference comes from. If you start to follow G.19 reports monthly, you will notice, that every single number changes for just a little.

For example - on January 2006, Ive recorded 2185028 for total Consumer Credit. If you look at it now, its at 2177280.

Maybe we should ask the FED why this differences are made.
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