That Was The Week That Was-4th Week November

  The loss of lives when the Titanic sank were caused by the lack of lifeboats and the lack of understanding how to utilize those lifeboats to their maximum advantage. Some boats were overloaded and others were castoff virtually empty. The Titanic sank quickly and many lives were needlessly lost. The question I have to ask is:  Do You Have a Investment Life Boat Plan?  Global economic meltdowns could very well be upon you before you even realize the danger. Each investor should have their own specific plan for what to do when markets collapse. This is not a plan for market corrections but for a good old fashion Black Swan event that crashes markets and causes grown-ups to cry reading their investment statements. Your plan should be written because during an actual event, as history has shown,  you will not, in most cases, be able to think rationally. Your broker does not have the right to arbitrarily act for you without specific written instructions. Here are some questions you have to ask yourself to devise a feasible Investment Life Boat Plan:

• At what % loss do you implement your plan?
• Do you sell or hold?
• Do you sell everything or a portion?
• Do you come back in and when and at what number at what index do you buy?
• If you sell do you go to cash or to fixed investments, or some other investment?
• What specifically would you buy?
• Do you hold what you have and simply add to your portfolio? Buying what?
• Do you take advantage of the markets crash by buying Inverse ETFs? Which one would you buy?
• If you are an income recipient how do you weather the economic storm?

China ‘s Central Bank Reduced Rates to Jump Start Economy

November 21st two major central banks cut rates in order to reduce the possibility of deflation and boost the global economies. The People’s Bank of China and the European Central Bank signaled it may take new measures to boost inflation. This two weeks after the Bank of Japan said it would ramp up its own Quantitative Easing.  The global markets embraced the free money and the Dow opened plus 160 points before closing off its highs but still in record territory. WSJ 11/22/2014

 

 Do You Know This Man? He’s the guy who accurately predicted the crash of 2008. Peter Schiff, CEO of Euro Pacific Capital, and he’s back claiming the Federal Reserve unconventional,ultra loose, monetary policy has inflated the prices of stocks and bonds. He said what this economy needs to get itself back on track is an old fashioned recession. Schiff went on to say that gold will skyrocket and the dollar plunge as soon as the market realizes that stocks are overheated. He thinks that dollar could fall by 90%. There are others that scoff at Schiff’s reasoning and point to the fact that the Federal Reserve is not going to unwind its balance sheet anytime soon. Ethan Harris, global economist at Bank of America Merrill Lynch, said people confuse bank reserves with money. ‘Until banks start lending those reserves, those funds are not going to enter the economy.’ It’s a gradual process and not something that happens right away. MarketWatch.com., CNBC.com 11/22/2014

The Alan Greenspan Underwear Economic Indicator. Who remembers that? USA Today last Sunday reminded us of this 1970ish indicator created by Alan (I’m Taking A Bath!) Greenspan’s consulting firm. Basically it said that men’s underwear sales during good times were fairly flat but fell during bad economic times. Seems that there could be something to this as Victoria Secret sales are up along with HanesBrands. Let the good times roll, eh?

The NASDAQ Rocked Monday +42. It was a merry time if you were in the tech sector but the markets latest run has ignored banks, life insurance and REITs. While those businesses are fundamentally solid, according to Michael Kahn at Barrons.com, they pose a significant mixed message to investors. If the financials don’t pick up the pace and move forward they may be vulnerable to market weakness and technical failure. 11/25/2014 Barrons.com

Some Hedge Funds are having a dickens of a time making money in 2014. CNBC 11/24/2014 OPEC meeting decides if there is to be a cut in production. The cut has to be meaningful around 1.5 barrels a day. CNBC 11/24/2014

Those who believe in cycles, writes Avi Gilburt, author of The Elliott Wave Trader.net, there are indications that a ‘top’ could have been struck on Friday before last. Giburt’s analysis suggests either a pattern setup for a 300 point correction early in 2015, or to continue this rally into the end of the first quarter of 2015, before the 300+ point pullback takes hold. One way or another, he writes, there will be a higher market followed by a 300+ correction, which will then be followed by another 500 point rally. There are no indications that this bull market will not be seeing much higher levels in 2015, he predicts.

That Was The Week That Was-3rd Week November

  Seniors Be Careful Out There. My 97- year old mother called me and said she got a phone call from the Internal Revenue Service saying that she owed them money. The person then rattled off a phone number where he said she should immediately call and ‘settle-up’.  It was a Saturday morning and we all know the IRS doesn’t work Saturday, and it also doesn’t call someone out of the blue. There is always a letter preceding any call explaining what the IRS is looking for and informing the taxpayer what they are investigating and what the IRS needs to settle their query. This was not the case. This type of scam is scary and could happen to you or an aging relative. Seniors sometimes get embarrassed or frightened when faced with a situation where they ‘think’ they did something wrong and need to fix things quick. Rather than call someone for help they’ll want to do things themselves. If you have an aging relation make sure they understand that anything that has to do with money and strangers calling out of the blue they should call you soon after. After my mother told me the story and I explained what had happened she said she was going to take a pill and go back to sleep. So this story ended well.

 The scams are endless and you have to be wary at all times.

 

More worrisome than inflation is deflation. The clue is falling oil prices and our strong dollar. Central bankers know how to deal with inflation they simply raise interest rates and the economies cool down. Deflation is another scary thing entirely. This is where consumer prices fall, profits erode and with little to no profits company’s shut down businesses. Unemployment rises, people stop saving since interest rates remain at uber-low numbers. Investors find that investments they were comfortable with are stagnating or non-performing. Gold falls along with the entire commodity group. Deflation once infested in an economy it is difficult to remove. Japan has lost decades to a deflationary economy. I’ll have more on deflation at my client meeting in 2015 and what investment work best.

Japan Falls Into Recession: WSJ 11/16/2014. A sales tax increase cut into Japan’s growth revival.GDP fell 1.6%. Eighteen economists had expected a 2.25% expansion. The nation’s sales tax hike will be delayed as Japan deals with this latest economic policy failure. In Japan the economic policy is named after the Prime Minister Shinzo Abe, Abenomics. What is surprising is not that Japan has fallen into recession but that one would get a consensus from 18 economists.

Money poured into Shanghai-listed shares on the first day of trading last week. The Shanghai-Hong-Kong Connect trading link opened up mainland Chinese markets to global capital. This allowed world investors to access shares trading in Shanghai. It also allowed wealthy Chinese investors to Hong-Kong securities. Up to now only a handpicked number of fund managers were the only foreigners allowed to invest in Chinese financial instruments. It’s capitalism, sort of.(WSJ 11/17/2014)

How do you tell the health of our domestic economy? People go out to eat! According to The Economic Outlook Group a combination of factors shows that the economy is getting better. A better back to school shopping season since The Great Recession (Yes, they’re now calling it that!). We should also see a better holiday season because of the good back to school sales, reported Phil Orlando, chief equity strategist at Federated Investors. Economists have also predicted that a 1 cent drop in the cost of gasoline puts 1 billion dollars in consumer’s hands. It’s estimated that in many parts of the country gasoline has fallen to less than $3 from $3.70. (You do the math. That’s a lot of extra money!) That has created a dry powder, Orlando said about the drop in gas prices, for an excellent Christmas. The one missing piece for a complete recovery, according to the 11/16/2014 MarketWatch.com article from Jeff Bartash, is higher wages. And, housing, I would say.

 

M&A, that’s mergers and acquisitions, has been boosting 2014 markets with company’s lofty share prices and cheap credit. Firms have been trading stock to acquire other firms. So far $3 trillion in deals for 2014. WSJ 11-18-2014. Whispers that they good times will continue to roll for another 6-12 months.

Oil prices may not come back for some time but it is never to late to ‘bottom feed’ on oil companies that have been ‘dinged’ in the crush. Holders of oil and energy stocks will get dividends buying more shares at the lower share prices and realize nicely when share value returns. Do your homework.

Avoiding Risk by Avoiding Investing. Sometimes people think that they’re beating the system by holding assets in cash or in a money market, earning little or nothing on their savings. Other times they sell everything whenever the markets hiccup. By doing this, they think, no risk is being accepted. They’ll ‘wait’ things out until another global meltdown and then step in to buy ‘bargains’. The fact that catastrophic global depressions happen once every 100 years seems to be blithely ignored. In the meantime these investors lose money to inflation and decreasing purchasing power of their ‘riskless’ savings. When they do wake up they’re so far behind that their savings plan is a shadow of where it could have been if they’d stayed invested. Understanding and accepting risk is essential in any form of saving.

 

 Jeremy Grantham, founder of Boston based money manager GMO, opinioned about market tops and stock market crashes on his GMO web site. You could do far worse than reading and following the wisdom of Grantham. He writes of markets being overpriced and the unknown consequences of what he calls the largest red herring in the history of oil, fracking, and yes, even a stock  bubble where things will come crashing down, as they always do whenever there is such a bubble. So where is the top according to Grantham? We have another 10% on the S&P 500 before a fairly large retreat. That’s 2250 in case you need a number to write on your refrigerator.  Barrons.com and GMO web site 11/2014.

No Recession in 2015 But No Growth Either, according to a Bank of America Merrill Lynch survey of fund managers. Fewer than 1 in 10 fund managers expect a recession in 2015. Emerging markets are poised for a further rally, according to the same survey. CNBC 11/19/2014. And we all know what great crystal balls most fund managers have had in the past.

Did you know there is a web site where if you don’t know how to pronounce a word will pronounce it and explain what it is?  www.howjsay.com

Bob Pasani at CNBC thinks 2015 may be a good year for stocks. He reported reading the Stock Trader’s Almanac, 2015 edition, that 2015 is a presidential pre-election year and the Dow has not had a loss in a pre-election year since 1939. Also, the worst two quarters of the four year presidential cycle are the ones we just left- the second and third quarters of the midterm year. Pasani also writes that 2015 is the fifth year of the decade. The fifth year is the best year of the decennial period by a long shot. Over the past 130 years the Dow and its predecessors are up an average 28.3%. There has been only 1 losing year ending in ‘5’ in 13 decades. CNBC 11/19/2014 Bob’s on the right talking to Art Cashin, Director of Floor Operations at UBS.

It doesn’t hurt to be a bit defensive in 2015. Look at dividend paying all weather stocks that perform and pay a dividend in good economic times and bad.

Goldman Sachs outlined their economic theme for 2015. They reported that there will be a broadening economic recovery, with the U.S. to remain the primary engine of global growth, while Japan and the euro area are set to look a bit better. Oil, they believe, will be lower in 2015 than in 2014. Reported in CNBC.COM 11/20/2014.

Thursday’s Factory Activity in the U.S. Mid-Atlantic region expanded at the fastest pace since December 1993. The Philly Fed said its business activity index doubled. Analysts expected a modest 18.3 number and what they got was 40.8. Any number above zero indicates expansion. CNBC reported 11/20 that the numbers most surely would fall back to more normal levels but it seems that the U.S. economy is impervious to any bad economic news that comes from overseas. Markets continued their upward momentum.

 Have a Happy Safe Thanksgiving.

Questions call Paul @ 586 295 0430 or write him at pstanley@westminsterfinancial.com. Share this blog with someone who cares about their money.

Securities offered through Westminster Financial Securities, Inc. Member FINRA/SIPC.

That Was The Week That Was-2nd Week November

 

 A lovely article in Barrons.com 11/6 in the column, ‘Read This, Spike That’, by John Kimelman. who reported on a piece in the Street Authority on how holding lots of securities can lower one’s risk, that diversity also reduces one’s ability to ‘beat’ a benchmark. Patrick O’Shaughnessy, a principal at O’Shaughnessy Asset Management wrote in a Yahoo post that, ‘To take advantage of value investing, you need a smaller portfolio than you may think.’ He then did a test which found that the best returns came from a five stock portfolio, the best Sharpe ratio from a 15-stock version. He concluded that both returns and Sharpe ratios degraded after 15 stocks.’ This is similar to Warren Buffett’s philosophy of buying the best company stock you can find  but your second purchase will reduce your overall return since it is not as good as your first.  As will your third and fourth, etcetera. The problem is magnified when buying funds and ETFs and the average investor confuses asset allocation with diversification and increased returns. Owning too many funds and ETFs simply reduces risk and rarely increases returns over time.

 

The Sharpe Ratio is a ratio that describes how much excess return you are receiving for the extra volatility that you accept for holding a riskier asset. In other words, is it worthwhile to accept the higher risk/volatility. A ratio of 1 or better is good, 2 is better and 3 is considered the best.

 

  ‘ My insurance agent told me I badly needed a (blank). ‘ Was it a Trust? A Will? A joint-life insurance policy? Or, was it an estate plan, and do you know what an estate plan is, does and who should have one done? And, who exactly does estate planning? Get questions in to me for my annual client meeting about estate planning, wills and trusts. You can e-mail or call me. Larry E. Powe, attorney with Keller Thoma, PC, will be my special speaker explaining all.

Batting better than Ted Williams- The Inverted Yield Curve preceded a recession five out of the last five times. Source Ridgeworth Investments in their brochure, Rates, Performance and Markets. What exactly is an Inverted Yield curve? That’s when the short term Treasury yield is higher than the long-term Treasury Bond yield. Investors noticing a higher three month T-bill versus a lower 10-year may well prepare themselves for bad news coming from the equity markets.

  Next Monday China will launch ‘Shanghai-Hong Kong Stock Connect’ program. Retail investors from around the world will be able to invest in mainland Chinese equities. Goldman Sachs said in a recent announcement that the opening of the Shanghai to foreign investors was an opportunity ‘simply too big to ignore.’ It will create the second largest equity market by market cap next to New York. Eventually it could add 855 companies with a market cap of $1 billion. Goldman Sachs, MarketWatch 11/10/2014

A University of Michigan study on money, material goods, life experiences and happiness. Life experiences have a longer lingering effect while material purchases fade. Still those with $500k income are ‘very happy’.

Cody Willard wrote: 4 Near Term Catalysts For The Next Stock Market Crash. MarketWatch.com 11/11/2014.

• Oil drops to $50
• A spike in gold to $2,000
• Food prices and inflation take-off
• Currency wars. Nations like cheap money unlike those of us who work for a living. Cheap money allows goods and services to be more attractive to other people.

Cody doesn’t think a crash is around the corner but warns to be objective and vigilant.

Reason #12 Why Pistons Continue to Lose… they got the wrong guys suiting up….Drummond should be starting and not Drummund…Oy!  a tip to USA Today.

 

Room to run- A strong bull trend, according to Michael Ashbaugh, from the Technical Indicator. The technical backdrop remains bullish despite a massive three-week run.

CNN reported ‘Millennials Arent Saving a Dime?!’ According to Moody Analytics people under 35 are not saving money. They’re the only group with a negative saving rate, they report. (Forget that jobs are scarce and Boomers are hanging around longer due to the recession.) According to Dr. John Edmunds a Babson College finance professor, ‘Millennials are waiting for those above them to either retire or die.’ The Boomers are not going without a fight.  In my opinion they’ve reported this exact same thing on every generation including the Boomers. Nothing being said or reported about Millennials hasn’t already been said about every previous generation since the Civil War.  

The Trauma of 2008, most people don’t realize how severe it was that’s keeping our markets still moving forward.

Ron Insana wrote for CNBC.com that gold could drop to as low as $800 an ounce. In Barrons.com John Kimelman wrote that the case for a strong dollar, while good for consumers, is bad for our domestic companies that try to sell their goods globally. Makes the products expensive in relation to others and less competitive. A market crash doesn’t happen simply because stock returns have been so high. Investors are not doomed to poor returns going forward because of great previous returns. Finally, a bad winter won’t necessarily be a boon for higher energy prices. There is an over-supply. Oil trades in dollars and as long as we have a strong and strengthening dollar, along with abundant supply, the energy trade will be on the back burner for a while longer. Barrons.com 11/12/2014

From the Department: If it sounds too good to be true-Investors may have lost $1 billion!  That’s the story from Bloomberg.com 11/13/2014. An Internet trading company in currencies promised investors a return of their principal but also showed a history of returning 1% per day gains. It was a perfect investment- returns that were out of sight but with a principal guarantee. No one can lose. A 1% daily return even without compounding that’s 250%, or more than 25 times the average S&P 500 Index return for the past 50 years! An English doctor and wife reportedly invested with the company and watched the company’s internet site as their earnings piled up. Eventually they asked for ‘some’ of their money and were told that because of foreign tax that it would be delayed. Another request and another stall until finally the company disappeared. Regulators think that all investors have lost a billion dollars in this forex fraud. Customers in 11 countries have seen their money disappear. The article did not mention if anyone was arrested, or even if perpetrators were found and questioned.

Market Closed Up Thursday – Oil Down- Closed at $74 Commodities Beaten Up. Blame the strong dollar and the fact that more oil has been drilled in the U.S. since the 1980s. (source MarketWatch.com). CNBC 22 Trades in 79 Seconds expects copper to be the next commodity to fall in price. ‘It’s held up fairly well,’ said Guy Adami. “I wouldn’t surprise me it’s next and falls below $3.’

You Making Your List? Traders should be diligently searching for quality beaten up stocks to add to their buy list. It’s what you do when certain sectors are crushed. Most of us are investors buying quality and holding for the long-term.

Questions? Call Paul @ 586 295 0430 or write him at pstanley@westminsterfinancial.com. Share this blog with someone who cares about their money.

Securities Offered Through Westminster Financial Securities, Inc.Member FINRA/SIPC.

That Was The Week That Was-1st Week November

You should start your year-end investment tax planning right about now. In their ‘Improving Your Finances’, column Morningstar’s Christine Benz outlined what investors should be doing.

• Consider selling if you planned to do so anyway.
• Don’t sell without considering your tax position.
• Look for tax-loss candidates.You can use those losses to offset capital gains.
• If you’re 70 1/2 tie in your RMD with your tax-portfolio maintenance.
• Don’t spend any RMDs you don’t need.

There’s a potential problem brewing. I think. Recently the Treasury Department released guidelines for 401k plan sponsors on how to expand the use of deferred-income annuities; and the use of target date funds that include annuities in their assets. The government and regulators are concerned that employees contributing to 401k plans will not have sufficient income at retirement. In that regard they have expanded the use of annuities that provide ‘guaranteed’ income. Mark Iwry, deputy Treasury secretary said that by encouraging the use of income annuities (inside 401k plans) can help retirees protect themselves from ‘outliving’ their savings. The problems,as I see it, are three-fold. The long-range potential lower returns that historically annuities provide. The extraordinary expenses that annuities charge. The long-term individual retirement income planning that often makes annuity income more sensitive to inflation. Participants in retirement plans always have had the option to purchase a fixed immediate income annuity upon retirement. Offering a systematic approach to an annuity purchase during the accumulation phase has the potential problem of reducing returns, increasing the cost of retirement saving and limiting choices at retirement. Questions regarding your 401k or retirement plan please either call or email me.

 

‘I Was Wrong!’, said Dennis Gartman, author of the Gartman Letter. On October 16th Gartman told CNBC that the selloff in global markets was the start of the Bear Market. The problem is that markets up 8% from that date the 16th to October 31st. When re-interviewed Gartman said it’s still a bull market. He also said he wants to own things that if dropped on his foot would hurt- like metals, railroads and ships. CNBC 11/03/2014

There is a difference between an investor and a trader. The former is a long-term holder of investments while the latter speculates on the value over a very short period of time. Jack Bogle in a radio interview MoneyLife with Chuck Jaffee offered advice to fretful investors was simple to close one’s eyes to all the ‘current noise’. Traders, according to Bogle, do very poorly while investors over the long-run do well.

According to Experts in WSJ, Barrons.com, MarketWatch.com and others, the big winner after the mid-term election will be stocks! Since 1942 mid-terms have ushered in a consistent bullish market. The odds are 100%, according to ‘Up and Down Wall Street’, author Randall W. Forsyth. The returns are also eye popping with an average annualized return of 15.6%. Stocks also perform well in the third year of a presidential term. Since 1950 on average the stock market is up over 18%.  WSJ, MarketWatch.com, Barrons 11/4/2014.

 Mr. Market liked the  election results and Wednesday the DJIA was up +100, The S&P +12 and Naz-3. Still Michael Sincere, in an Opinion, wrote that the recent rally was for suckers pointing out certain indicators were missing including no participation by the transports and failure to see institutional trading. MarketWatch.com 11/5/2014 The market continued its upward slog through Thursday posting modest gains.

WSJ announced Friday 11/7 the SEC approved a new type of fund structure that doesn’t disclose its holdings. In the world of private placement this is called ‘a blind pool’. It generally means that the investor has an ‘inkling’ of the general type of investment but not the specifics. ETFs are structured like mutual funds but trade like stocks. The complaint in the ETF industry has been transparency of holdings, allowing competitors to see their trades. The SEC has turned down previous requests by other investment firms for similar designs.

Investor optimism is usually the harbinger of souring markets. From a recent market correction the results indicate the highest level of individual optimism since 12/26/2013 and the lowest pessimism in nine years. The rules is to buy when everyone is worried and sell on ‘happy’ news. The wonder is if the ‘bullish’ opportunity is over was questioned in the 11/7/ 2014 MarketWatch that published the above results from The American Association of Individual Investors.

What do you want to know about estate planning? Wills? Trusts? How to organize what you own in an orderly and uncomplicated manner to leave to those you love? Do you have questions about a parent or relative’s estate? At my 2015 Annual Meeting Larry E. Powe, attorney with Keller Thoma, PC, will present the answers to your questions. Send them to me via e-mail or call me.

Questions call Paul @ 586 295 0430 or write him at pstanley@westminsterfinancial.com. Share this blog with someone who cares about their money.

SECURITIES OFFERED THOUGH WESTMINSTER FINANCIAL SECURITIES, INC. Member FINRA/SIPC.

That Was The Week That Was-5th Week October

 

Big News of The Week! The Federal Reserve Ends Bond Buys, Market Slumps, Bond Yields Jump but ‘Considerable Time’ Before a Rate Hike Is Still The Language Du Jour. Waiting on pins and needles Wednesday the Street finally got the news at 2 PM EST that it was waiting for. There was nothing startling new or unexpected but the markets still took a slight hit. The 10-year jumped to 2.350%, meaning principal fell. The Fed made no mention of European malaise or defining exactly when a rate hike would be made. (Common knowledge thinks a June 2015 hike is still in the cards). It did say that the labor markets have improved with solid job gains and a lower unemployment number. Inflation, the Fed concluded, would most likely in the short term be held down by lower oil prices. The Fed judged that inflation running below 2% has diminished somewhat since the beginning of the year.  The Central Bank fears deflation more. Info from Barrons.com, MarketWatch, CNBC and WSJ.10/29/2014

 

In more market news…

  Bounce! Market corrections typically are V shaped. They go down relatively fast and then they ‘bounce’ back within a short period of time. Even experts cannot tell if this recent market dip was a correction or the beginnings of a crash until things cool down. The market correction began in September and pretty much ended as the third week of October started. It almost got to this- …yeah, that scary stage. Economist Gluskin Sheff, in his economic commentary, reported in October 25th MarketWatch.com., wrote that,’ In reality bear markets do not just pop out of the air. They are caused by tight money, recessions, or both. These conditions do not apply, nor will they until 2016 at the earliest.’ Sheff’s chart is below. The shaded areas are what he calls recessions. Stocks are the place to be. Applied Global Macro Research’s Carsten Valgreen sees stocks rising (modestly) 5% to 8% annually over the next three  years. The Barrons.com report 10/25 concluded that Valgreen’s crystal ball clouded as to the exact date when things will end.

 Social Security 2015 Increase to current retirees will be 1.7%! The cost of living adjustment is expected to increase the average income benefit by $22 a month. This follows increases in previous years 2013=1.7% and in 2014= 1.5%. For workers a higher cap to $118,500 from $117,000. Workers taking social security who are under the age of 66 may earn $15,720 before $1.00 in benefits will be withheld for every $2 earned above that limit.

Do You Know The Difference Between a Trust and a Will? Should You Have One, Both or Simply Named Beneficiaries? Many couples draw up a Revocable Living Trust and then forget to fund it. It’s one of the biggest mistakes people make.  At my annual client meeting in 2015 attorney Larry E. Powe will present information on how to best handle your particular estate plan. More info as to date and time later.

WSJ 10/27/2014 reported that the disparity in wealth today was caused by doing the wrong thing in 2009. The family that sold at the bottom of the market crisis has far less than the family that held throughout. Stocks are the place to be, the article reported. Professor Jeremy Siegel calculated that stocks have returned on average 6.7% per year over the past 200-years.

When should you take Social Security? Financial Experts contend you should wait to maximize your income. My argument is that you should take it as soon as possible. Why? Someone who waits 4 years from age 66 to age 70 gets no income during those four years. On average it will take almost 15 years before the higher social security income outperforms and makes the wait worthwhile. That fifteen years almost coincides perfectly with the lifespan of the average U.S. male.

WSJ cover 10/28/2014. Art Cashin, UBS director of floor operations at the NYSE, said oil is the key factor moving the stock market. ‘If oil dips below $80, we expect to see pressure come back on equities.’ CNBC 10/27  Someone was reading headlines.

Goldman Sachs, chief equity strategist David Kostin, reiterated his year-end forecast for U.S. equities, Monday 27th October. He repeated the S&P 500 Index would hit 2050 by end-of-year.  He also said U.S. success would not get dragged down by ‘stumbles’ in the rest of the world. Monday markets ended essentially flat.

 

Consumer Confidence Hits a High and Pulls Market With It. The Conference Board Consumer Confidence Index up 94.5. The index that follows what consumers buy has improved from an estimate of 87. Low gas prices and improved business conditions contributed to how people feel. This boost, suggested CNBC 10/28/2014, should be a welcome sign for retailers this coming holiday season. The Dow was up  188 points, Naz +78 and the S&P closed +23. Oil essentially flat and gold down.

 It was a 1-2 punch Thursday as the Japanese Central Bank shocked the markets by expanding its quantitative easing, increasing its bond purchases by 30 trillion yen a year. It would also triple its purchases of exchange traded funds and real-estate investment trusts. Most economists expected no action. Japanese stocks surged on the news. In the U.S. news that the 3rd quarter GDP grew at 3.5% versus an expected 3% rallied stocks into a triple digit move higher. It was a very good week. INFO gathered from CNBC, Barrons.com, WSJ. 10-31-2014

Questions call Paul @ 586 295 0430 or write him at pstanley@westminsterfinancial.com. Share this blog with someone who cares about their money.

Securities Offered Through Westminster Financial Securities, Inc. Member FINRA/SIPC.