This would have been easy to predict. All you had to do was look at the headlines in your daily news source and it was obvious. I present a few here for you to consider.
The International Monetary Fund (IMF) has reduced their economic growth forecasts for developing countries by 13% and the U.S. in particular by 48.15%!
The IMF is also requesting an additional $600 billion in funding to help out Euroland. The U.S. is the largest part of the IMF and will thus have the lion's share of the tab.
Standard and Poor's downgraded the credit ratings on over half of European countries. They also downgraded the European Financial Stability Fund (EFSF) Aka, the Euro "bailout fund".
Talks are taking place to discuss how to deal with Greece when they default.
Housing starts released today dropped 4% and permits, which indicate future growth, were flat.
Gasoline is pushing up toward $4.00 in most of the country leaving less for discretionary consumer purchases.
Retail sales for the past holiday season ended up as zero growth. Never mind, this one was not in the paper.
There are rumors the Federal Reserve will start a form of QE-3 when they meet next week. The $1 trillion will be used to buy semi worthless mortgaged back securities from banks. In essence transferring the bad loans to we taxpayers.
U.S. Debt is the highest in history at 100% of our productivity or GDP.
The Federal Reserve of Philadelphia index of conditions came in at 7.3% versus economists estimates of 10.3%, only off by a cool 29%!
As I write this The U.S. has routed three aircraft carriers to the Persian Gulf to make a presence in the wake of Iran's threats against the U.S. and other counties located in the gulf region.
Goldman Sachs reported earnings dropped 58% and,......you guessed it... the stock went up 8.10%.
I called our Wealth Strategies Group Solution Network™ Charted Financial Analyst, Charles Sizemore, CFA, and asked him to explain to me how the market could possibly go up in light of this type of news. He replied, it is just like what the character played by Matthew Broderick said in the movie The Freshman, "THERE'S A KIND OF FREEDOM IN BEING COMPLETELY SCREWED BECAUSE YOU KNOW THINGS CAN'T GET ANY WORSE."
We will continue to be open minded, but cautious as February tends to be a risky month. Please call me with questions, comments or discussion. 1.800.800.6364
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which investment(s) may be appropriate for you, consult your financial advisor prior to investing. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.
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