Hold On Your Money Untill Big Banks Report Next Week and Be Aware of the Current Market

Dec.16, 2007 in Investment Opinions, Market Outlook, U.S Hot Stocks

The raising inflation is going to hurt all the creditors as well as the whole U.S economy. Most of people are not optimistic about the reports of banks for next week.

“On the whole, if we look at what we know is coming out, I think we will be hard pressed to find major positive catalysts,” said Art Hogan, chief market strategist at Jeffries & Co. “I would expect stocks to move more on what the future looks like for financials. That is probably going to be the biggest driver.”

Most of stocks would slide along with market trend next week, so do not invest without considerations.

From casual conversation with a hand full of people this is what I am observing

investors are expecting returns from 01/2006 - 07/2007 as the norm and are substituting the gains for loss in available home equity
most are sitting on 10%-15% YTD gains (factoring in emerging and international equities)
most global growth story will save equities
most will not liquidate until they reach 0% YTD
they are interested in the calendar year YTD gains

IMHO “the white of the eyes” will show when

10% - 15% drop from here between now and end of year
starting new year the counter resets, and a 10% decrease from Dec 31 closing prices

I am not saying or predicting in this market which way the market will go. These are my opinions of the conditions that may force the investing public to head for the exits.

PICKER, the average investor primarily is interested in the closing price. When observing the increase in 2% and 3% intraday movements, I speculate there is more than meets the eye.

We’re all on the same ship, the perspective depends on which level you are on.

I wouldn’t be so certain about the US equity markets going down the crapper. Just to reiterate my point about exports (11% of GDP comes from exports)….

American exports are now coursing their way around the world at a record level.

In a major shift from the past five years, the US trade deficit, after stabilizing last year, is now shrinking. US companies, faced with slower economic growth in their home market, are now targeting foreign buyers. It doesn’t hurt to have the dollar sinking in value….down almost 9 percent so far this year…and a relatively strong global economy. In fact, the US economy would be flirting with recession if it weren’t for the 1 percentage point of growth fueled by the export surge.

“Exports have suddenly become a key source of growth at a time when the economy is looking for any growth it can get,” says Mark Zandi, chief economist at Moody’s Economy.com.

The largest US exports last year: nuclear power plants, followed by electrical machinery, vehicles, airplanes, and medical equipment. The trade situation has shifted so dramatically, Mr. Zandi says, that the US is now exporting lumber to Canada for the first time in 25 years.

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