This is an interesting point in the markets. If the markets can break through this level then money will likely chase the markets higher for another 500-1,000 points, but if the markets can't breakthrough then we could retest the lows in short order.
Obama Infrastructure Play - I think it's very early to comment on the likely success or failure of President-Elect Obama's infrastructure spending plan. Many engineering, construction and energy stocks are rallying on the prospect of better business as a result of this stimulus.
I hate to be a wet blanket, but I think we need only look at a couple of recent large infrastructure builds in the US - The Big Dig in Boston and Rebuilding the World Trade Center come to mind - to realize a couple of things. The cost overruns will be monumental, the pace of work will be painfully slow, and the end results will be mixed. We can't expect to build a new Shanghai, Dubai, or Beijing with our current set of regulations and bureaucracy.
Rather than rebuild the crumbling infrastructure in east coast cities, I'd love to see us build a new financial capital on the shores of a northern border river that sits within a 1 hour flight of most major cities and a short drive of all major Canadian cities :) I'll be happy to head up that committee.
Monday, December 08, 2008
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