Sunday, December 12, 2010

Week in review:

* The tax deal compromise in DC is clearly another stimulus plan that everyone in Washington loves because it's a stimulus in sheep's clothing. This won't have the negative connotations that came with voting for TARP or the stimulus 1.0 or 2.0.

* Trade deficit shrank which will goose Q4 GDP estimates in the US.


* Consumer confidence rose last month and is now at it's highest point since June.

* Diesel shipments up a bit year over year, but still down from July indicating a slowdown overall in the economy.



* Glass half full or half empty story - Rental vacancies fall (good) as more people lose their homes (bad).


* Interest rates around the world continue higher

* The spread between smart money and dumb money (according to various data inputs) is at it's highest level since the 2006. This should start to concern some market observers if this trend continues.

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I'm sure this will end well....

"By some industry estimates, as many as 10,000 people in China are doing speculative day trading of American stocks — mostly aggressive young men working the wee hours here, from 9:30 p.m. to 4 a.m., often trading tens of thousands of shares a day.


“Trading groups have exploded into China,” says Stephen Ehrlich, chief executive at Lightspeed Financial, a New York company that sells trading software to firms operating in China.

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I thought this chart might be informative to look at the recent history of the stock market over the past 12 years. If you bought stocks on 12/31/98 you are basically back to square 1. Over that period the market has rallied 68%, fell 50%, rally another 100%, another 58% drop and an 83% jump. Buy and hold has gone nowhere over the past 12 years but a trader identifying trends can capitalize on the way up and down even if the market goes nowhere.


Cheers!

PS - I figure after 1000+ posts, I can ask a favor of my readers. Can anyone recommend a smart, local primary care physician in NNY? I still have my primary care physician in NJ and that has worked well when all is well, but when the occasional sickness strikes the homestead it's hard to plan a 315 mile visit to my doctor.

Feel free to offer up suggestions in comments or shoot me a message.

Thanks!

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