…and the market class starts whining + selling immediately as there was a TINY increase in dovish sentiment. The dollar spikes and everything priced in dollars must fall.
Please find them a pacifier.
Apparently, Cisco's CEO Chambers was on Bloomberg and said government spending to "get tougher". With thousands of computers scanning for words or apparently listening for them we had a quick flush down en masse, but now have stabilized a bit. It is a pretty innocent statement and not surprising but you never know what little catalyst will move things – up or down.
The S&P 500 sits a tad yearly highs that it reached early last week and retested yesterday.
As I wrote late last week the reaction to Red Hat's (RHT) earnings report (solid beat) and guidance (mild upgrade) by the market did not make much sense to me. But surely the investment base is not complaining. …
This was a thesis I wrote about a few years ago on FMMF, and now the data continues to confirm it – in the "new normal" era where many people "bought" houses with little to nothing down – if not a 100%+ LTV loan – having no skin in the game has led to a new generation of Americans who put paying off the mortgage lower on the totem pole than credit cards or auto loans. [Apr 1, 2011: Consumers Continue Trend of Paying Credit Cards Before Mortgages] Obviously the no skin in the game aspect is just one reason – an eventual default on your mortgage now often takes years to come to fruition – during which time one can live 'rent free' and build up savings. And ironically pay off the credit cards. Contrast that to the harassing phone calls that come much more quickly in the process if one becomes late on credit cards or auto loans. Not to mention the fact repossessing a car is a much quicker process than repossing a home. …
Late Friday I wrote:
On the positive side it was nice to see stocks as a group have the ability to stay upright without a certain group of the same 10-20 stocks leading. We'll see if this is day 1 of a rotation into laggard groups of Q1, or a warning shot. Energy stocks continue to act strange – despite high oil they don't act well. …