Monday, December 08, 2008

We Ran Right to 8,900....

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.

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