I
attended a college reunion last weekend and I am always impressed by my former
roommates. The three are: (1) an Air
Force specialist in systems integration for bombers who is high in the
food-chain at the Pentagon; (2) a pediatric cardiologist; (3) a senior
executive (near the top) in a multi-national corporation. I am a Civil Engineer. Can you guess who drives the Chevy?
So
somehow the conversation wandered to corporate taxes, and you know who led that
discussion. (If you are not sure, it’s #3.) To paraphrase, he said, if you tried to
create a more screwed up corporate tax system, you couldn’t do it. We have the highest corporate tax in the world
and that encourages corporations to go overseas; but we have so many loopholes
in the tax code that corporations, for the most part, don’t pay taxes. The jobs go overseas and we don’t get
significant revenue? Politicians – I am
avoiding the temptation to go on another rant.
The
S&P 500 is now 11% above its 200-day moving average. The 2010 correction started last April when
the S&P was 12.8% above the 200-day moving average. We follow that statistic, but it is not in the
NTSM system since it is fairly unreliable in predicting a correction start or
finish. There’s just too much
variability. I point it out just to note that we are again
approaching a high level of bullishness by some measures. Our Sentiment indicator is only 50% though
and other than the one stat, things look OK for now.
The Navigate the Stock Market analysis switched to BUY on 20 April and it remains a Buy again today. The Buy indication means we are positive on the market, but the official Buy recommendation was on 20 April.
I
currently am 100% invested in the stock market.
That is way too aggressive for most people and I don’t recommend it
unless you have a high tolerance for risk.
