Here’s an excerpt from John Mauldin’s newsletter…
“…since
1945, all recessions have been business-cycle recessions. We are now in a
deleveraging/balance-sheet/ post-credit-crisis recession for which we have no
modern analogs, except maybe Japan. And that hasn’t turned out too well, as in,
two decades of going nowhere. Yet we are applying the same methodology (massive
debt and deficits along with zero interest rates) that did not work there, and
will soon bring Japan to ruin.”
Good
point, and frankly, very scary. It’s
just another concern that indicates that our economy is in for an extended
period of trouble. It reinforces the likelihood
that this Bear market will continue for 10 more years. If the Great Depression lasted 25-years; and
the “typical” stock market Bear lasts for about 15-years, I’m guessing the
current Bear Market will be with us for 20-years. (This one started with the end of the Dotcom
Bubble in 2001.)
Brian Battle, director with Performance Trust Capital Partners
said, “The court ruling confirms…(that Germany has the)…ability to help bail
out Europe's troubled areas, and that provides a great amount of confidence
that we will see some sort of solution in Europe soon enough."
True,
but at this point, I think our stock market is focused on our slowing economy
more than any other factor. High volatility
produces big up days as well as big down days.
I don’t think that there has been a change in outlook for the market.
S&P
500 was up almost 3% Wednesday. If
anything, today’s market move (3% up) indicates more down days to follow…and
soon.
From
CNN/Money: http://money.cnn.com/2011/09/07/news/economy/beige_book_federal_reserve/index.htm?iid=HP_LN
“The
Federal Reserve Beige Book released Wednesday showed economic activity slowed
in the Chicago, Richmond and Philadelphia regions, and continued at a sluggish
pace in other districts.” There was a piece of good news since consumer
spending was up.
Overall,
the Navigate the Stock Market analysis remains HOLD again today.
I sold on the 27 July sell signal at S&P 500 1301 and I am
defensively positioned with only a small amount of my portfolio invested in
stocks. (Zero stocks in the 401k.) I am
near 100% short in the trading portfolio.
(See
the page “How to Use the NTSM System” – the link is on the right side of this
page).
