Ok, I haven’t written a word since our last un-enjoyment. Mostly because nothing materially has changed in my opinion.
The stock indexes are what? Climbing a wall of worry. We will still see 11,464 in the next 6 weeks, and we will see a Newsweek front page story singing the praises of Obama for riding the Dow up 5,000 points from its March 2009 lows.
Unemployment will creep at 10 percent. When I was at Colgate taking my econ 101, we were continually reminded that most economists at the time felt that 6percent unemployment was “full” employment. 94 perecnt of people who wanted work had found work.
I have a theory that, much like everything in the past 25 years lost to social engineering, we will see a change in what economists consider full employment.
No dodge ball in school, no “losers” in little league or youth soccer, a dumbing down of or what is/or was once acceptable….This may be a little hyperbole, but hey, its 930 on a Tuesday night and I can still write what I want to write….
My point being that I wouldn’t be overly surprised if, sometime in the next 18 months, an economist comes out and states that “full” employment in the US really isn’t 6 percent, but more like 8 percent.. That means if Obama’s administration is somehow able to ride employment down to that new higher level of full employment, then, yes, his first term will indeed have been a gigantic success.
Maybe I am too cynical. I just know that at this point, with what I’ve seen from our politicians both on the left and the right, combined with the cheer leading nature of our split national media, nothing would surprise me.
Half the country loves CNN and the other 2/3rd likes Fox… or vice versa, depending on your own personal bent.
Obama’s Achilles heel may be how he handles the Israel/Palestinian issue, in light of fighting a war in Iraq and Afghanistan… If he Miss steps here, he could lose a chunk of his base. That would be a whole new ball game then.
For now, however, we have enough negativity to keep the climb up the wall of worry going.
Every day there is more negative news, yet the stocks hold up. That suggests some underlying strength.
There continues to be so much money on the sidelines, it is just a ticking time bomb as to when the money managers collectively light the buying fuse, and a flood of new dough raises the water level in the whole pool.
It may co incide with the mid-term elections on the horizon. Such a boost may be too little too late for the incumbent Dems who took their campaign warfare chests and an early retirement in anticipation of a spanking by the electorate. Another case of most politicians, unfortunately, being reverse indicators. The incumbent Dems may have bailed from the fray right at the bottom.
Look for Dow 11,000 then 11,400…
Watch out for a funky planting intentions number at the end of March which could give us the volatility spike we have been missing in the grains for the past 18 months. Again, the most surprising moves have a way of sneaking up on the masses. Right now, no one is looking for any surprises. Like a horror movie plot, the monster always pops out during a pause in the action.
And remember, use your stops to protect you against your own ego.