Monday, December 28, 2009

End of Year Prognosticators

Retail, Airlines and Energy are the sectors in the news thanks to the holiday, terrorism and geopolitical events, respectively. Do any of them matter this week as we have our second short and thin week in a row? How about healthcare now the light at the end of the tunnel is visible? My column this afternoon will be on healthcare so I won't spoil it here.

This is the time of year when the pundits look back and then look ahead. Every one is wrong. From predictions that Israel will attack Iran to Stimulus 13 (I cannot recall what number we are already on) it seems that everyone has an opinion on everything. Does the market's opinion no longer count?

I do not have a major revelation for you here today, partly because nobody knows the future and partly because I am trying to have a working vacation (does that really exist?). I've done the work part for today so I am rather eager to get away from my computer.

In general terms, however, I do "see" the stock market getting clobbered. What I do not see is when, since the evidence on the charts just shows a slow chug higher. It is the intangibles, from sentiment to smugness that all is well with the world because the economy is on the way back, that scares me.


joed said...

There just might be a rising wedge in effect on ESH0! I imagine a scenario including a nice false breakout to 1130s or more followed by a nice and well-deserved drop.

Happy New Year to you and yours and of course best of luck in 10!

I also would like to thank you for sharing your insight on this blog and I look forward each day for the next posting (rss too belated)

Keep up the fine work!

Paul O'Cuana said...

I'm a fan of Marty Zweig's advice: Don't fight the Fed.
With interest rates coming off their bottoms, Investor's Intelligence sentiment at 2007 levels, and the Fed without the ability to cut rates, the market has nowhere to go.
Whether you believe in deflation or inflation we're not in a good place.
Oh yeah, Happy New Year!

Michael Kahn said...

joed and paulocuana - both good insights. Thanks for contributing.