Don’t take my word for it. Watch your 401K.
Update: The Left’s predilection for Orwellian fantasy is almost stupefying. The reasonable person is forced to step back and shake his head, almost as a cleansing activity before responding. The myth, mentioned below, about the present market rally being a product of a healthy economy, created by BHO is gaining steam.
While it is at least arguable that Trump is creating positive market sentiment (I only see that as marginal or incidental), NO honest person believes Obama or his policies have anything positive to do with it. If there was an Obama effect, it would be that he is leaving and people interested in growing their retirement accounts instinctively understand that a great impediment to progress will be lifted in about a month.
A few days back I put out a piece about the present market run up. I said the present 19,000+ market, while awesome for your IRA or 401K, is not a product of a Trump victory.
It has everything to do with one, big, last hurrah by investors who have been getting near zero loans from Mommy Government and playing it on the stock market like monopoly money. Details here.
The only response I got was from cultists who think that was a shot at Trump. It wasn’t, of course. But these people have no rational perspective. And I was accused as being all doom and gloom.
Fed Chair, Janet Yellen
Maybe so. And who is to say I am not wrong. I have been on rare occasion. Very rare.
But I’m Not Alone On This
But there is another facet to all the Wall Street madness we are seeing. Barbara Kollmeyer, of Marketwatch.com kind of makes my point from a different perspective. The caution she sounds, I believe, points directly back to the point I made about the market.
This surge not based on underlying value in anything being played right now. It is based the fact that the market has run up so precipitously based solely on the availability of cheap money. (My warning.) The run up has skewed market-wide values. (Her warning.)
I believe the conditions she describes are the result of the warnings I’ve been sounding for months.
I Would Love To Be Wrong!
I would love to wake up next Tuesday and find that I have my head completely up my ass on this one. I want to see Janet Yellen raise rate by 1/2 a point to a point and then see the market continue its present advance.
Sadly, history has a funny way of ignoring what I would love to see. It also has a habit of happening while no one is looking. Now is one of those times. The average American is blinded by talking heads, still calling this a Trump rally, or they are not paying attention at all.
I’m not a stock broker or a financial expert. I just quietly watch things and spot trends. Often I lack the political or economic vocabulary to express my views in detail. That’s why the catagory your are reading is titled “Pedestrian Politics and Economics.
Trivial Anecdotal Validation
Just as one example, in 2014 I was standing in our break room with a co-worker, a mustang lieutenant. We were discussing the National debt. After much debate, I told him the National Debt would reach $20 trillion before the end of 2016. That was a ballsy call since we were in 2014 and Congress was discussing authorizing $16 trillion.
My buddy told me if it reached $20 trillion in 2016 he’d buy me a bottle of JW Blue Label. So Lieutenant, now Commander Samuel, if you are reading this, keep your eye on the debt clock. Now at $19,934,863,400,000 (8 Dec 16). In the time it took to get a sip of coffee it went up $500,000
You MAY owe me some Johnny Walker before the New Year. But you can make it Black Label. The Blue is too expensive in this economy.
But that was just me spotting trends.
Yeah! That’ll do.
Conclusion
Kollmeyer, on the other hand, IS a professional market watcher. You may want to pay her some heed. You have one or two working days to adjust you portfolio to ride out what I think will be a real bump after the Fed meeting next week.
But if you can’t, don’t panic. You can always use the advise at this link as a Plan B.
Good luck, and I want you to know we’re all counting on you.
Photo Credit: Trading pit: gregorywass Flickr via Compfight cc
Photo Credit: JW Black rouan Flickr via Compfight cc
Matt Jordan is a travel writer, host of streetpolitics.us and author of 16 20 24: A Path to Consistent Conservative Victory, on Kindle as: Street Politics: It Ain’t Your Daddy’s GOP Anymore!
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