The Markets
- The struggle between bulls and bears is reaching a crescendo. The bears feel it is time for a rest while the bulls feel we reached bottom on March 6th at S&P 666. Now at 835 there is a growing general agreement that we may fall back to 750, or so, then meander back up by July. These exact predictions sometime become self-fulfilling so I don’t discount them. I haven’t been adding to positions here and have tightened stops………moved them up closer to the last sale so as to guarantee at least a small profit.
- Marc Faber, who is probably the smartest financial guy on the planet, says we may have a 5%-10% sell-off. Since he is the same bloke who got me back in early in March, I pay attention.
- Alcoa kicks things off tonight with earnings and guidance.
- Earnings estimates for the S&P ranges from a low of $40 to a high of $55. So, if all earnings from all 500 companies in the index that is what you get. The P/E range at the above estimates is 14x to 20x. The higher number would indicate the market is a sell. You can see, then, the struggle bears and bulls are experiencing. It all comes down to earnings.
- And this struggle with earnings also helps explain why billions and billions of weekly Treasury bill auctions are sell-outs. Its a bird-in-the-hand thing. Even at 2%.
Sidebar
- I tried Wal-Mart’s answer to Trader Joe’s Two Buck Chuck. Wal-Mart offers Oak Leaf in a Sauvignon Blanc, Chardonnay, Merlot and Cabernet. Since I am an ABC (Anything But Chardonnay) kinda guy I have tried three. At $2.99 they are about what you would expect; Thin. But they are wet and OK with food. Certainly not worth while as quaffing wines. With family coming into town I’ll get a mixed case. For $36, why not? I know this will cause havoc among two of our wine-snob sons but I am trying to set a good example by cutting costs.
- Here is a fascinating and not insignificant development from Australia. Could this be setting precedents for governments around the world. The US? Australia to Build A$43 Billion Internet Network.
- BTW, the Aussies in a surprise move, cut rates last night.
- Oh, Japan kept their overnight loan rate at 0.10%. (!)
