First off…here’s today’s market highlights:
Now for my assessment of the markets on a cold Friday morning:
I’m calling this one from a baseball umpire’s perspective: I just call them like I see them.
And I’m not taking any sides. Republican or Democrat. Let’s face it, Donald Trump is not the Wizard of Oz and there is no Dorothy that has to go back to Kansas. What I mean by that is, as we approach Jan 20th, all that might have been put in place with good intentions will SLOW down to a government pace and that would have happened no matter who got into the White House. As the pace slows down the arm wrestling over proposals will start are all over again in both houses.
The EU continues to be a hot spot for terrorist attacks, bank bailouts and negative interest rates. With weak economic data from overseas, what positive data can we expect here that could force the FED to raise rates any time soon?
Will the dollar continue to strengthen, along with higher treasury yields? It’s been all too fast of an increase in my opinion, just off of hopes and dreams. So I expect when everything calms down, the equity market gets back to fundamentals, the dollar comes back to earth and Treasury yields soften, then the price of gold will find new levels of support. Commitment of traders indicates that the non-commercial gold traders are holding a long position, the lowest since February 2016. Some Wall Street gold traders indicate they are comfortable selling into any rally. So let the battle begin.
The U.S. debt continues to grow, reforming Obamacare will take some time and so will re-writing regulations to help the “STREET” going forward. Tax breaks, both corporate and individual, will take some time getting on the books.
Infrastructure plans are being developed which will increase government spending. The so-called 20,000 Dow is within reach – or is it? Most financial advisors I spoke with said the smart money didn’t wait for the 20,000 Dow party. They left town before year end. That might have been the reason the Dow stalled just below the magic number.
So as the party and the thank you tour ends, it’s time for our government officials to roll up their sleeves and get back to work, but I’m afraid it might be a little difficult taking off those fancy cufflinks.
Author Name: Walter Pehowich
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