As the markets rise the L shaped recovery from Wall Street's perspective is not being realized. It a V. On the other hand the L shaped recovery from the ordinary worker's point of view is in full bloom especially if you live in Las Vegas, California, Florida, and Michigan - good luck finding a job.
Each week we are now reading - "key data will show if the recovery is taking hold." This only demonstrates how precarious and iffy the situation really is. Investors are still shell shocked. One positive observation is simply in the fact that bad news has not caused the DOW to drop too far, too fast. Hopefully the days of the 400 and 500 point declines are behind for a while.
This week the Fed will hold a meeting. Investors will be very interested to hear what the word is on the Fed's take on the recovery and how interest rates will play out. Most feel interest rates will hold at next to zero through next year.
Modest optimism for equities is still in play.
Reuters: Stocks' rise hinges on Fed and data
The week's key economic data will include U.S. existing home sales, a report on new orders of durable goods such as washing machines and refrigerators, new home sales and a final reading for September on consumer sentiment -- all likely to put the expectations for recovery to the test.
"Let's be ready for some quarter-end asset allocation moves -- from cash and bonds to equities..."
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