Boring Market Action…Happy Holidays!!!
Posted by moolahtime on December 23, 2008
Folks,
The last few days have been uneventful to say the least. The markets have been going sideways and no strong moves either to the upside or the downside. Will we have the typical “Santa Claus Rally?” The technical indicators lead me to believe that it will happen. However, today’s market action was a bit disheartening.
On a positive note, our gold and silver investments have been holding up nicely. Also, the large “masters of the universe” companies with low debt and strong dividends are also holding up well.
On the downside, SRS has been behaving badly in the face of constant negative news for real estate. I am still holding it and will look to exit it once I am back in the green. These leveraged ETFs are tied to underlying derivative contracts which appear to not be the best way to short a sector.
Today, some news came out regarding 3Q GDP. Thankfully there were no major changes. The headline number of -0.5% remained the same, while personal consumption expenditures inched downward to -3.8% from -3.7% previously. All three categories of personal consumption, durable goods, non-durable goods and services, were pulled lower, with durables extending their decline to -14.8% from -14.1%, and services dropping from slightly positive to slightly negative.
Also, new home sales came in at an annual rate of 407,000 for November, falling well below the 420,000 consensus. The Northeast and the West ticked upward from October while the South and Midwest came down a notch. Supply also came down and prices turned slightly higher. Sales of existing homes hit an annual rate of 4.49 million in November, which also fell well below the consensus, which called for 4.90 million. Sales were down across all regions, but particularly in the Northeast. A lot of that is being driven by the destruction of Wall Street.
Here are some articles for you:
- This is definitely a classic. A short and sweet description of the current state of social security in the US.
- It’s good to see that some people are being honest. In this article, the governor of the Bank of Spain issued a bleak assessment of the economic crisis, warning that the world faced a “total” financial meltdown unseen since the Great Depression.
You may not get a post from me over the next few weeks because I am in process of putting together a newly hosted site. I will let you know as soon as it is complete.
Also, I want to wish all of you a safe and happy holiday and a prosperous new year. Be safe and enjoy the holidays. I will be heading to Costa Rica for a few days and am definitely looking forward to it.
All the best,
Moolah
