SubscribeAOL Finance: The Week In Preview May 5-9
May 5, 2008
An excerpt from my weekly AOL Money/Finance column:
The week in preview: Optimism reigns, but will earnings news prolong the fiesta?
May 5th - 9th 2008 - We are investing in optimistic times. News — good or bad — seems to magically morph into an opportunity to move markets higher. In the past week, even more than usual, weak economic news was accompanied by commentary along the lines of, “it could have been worse,” and other euphoric sentiments.
It is difficult to determine whether this is another short-covering bear market bounce or a real rally. But next week will bring us new information that will start to indicate where the answer lies. For now, investors are looking at the glass as half-full. Cash on the sidelines is moving in to equities, partly because there are very few other alternatives. Yields are low, commodities are risky and real estate is taboo.
Tags: Gameplan, EarningsRelated posts
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The market will rally on light volume, and those stepping in on the long side with new money will get their head handed to them. Regardless of the slow motion rise, and the talking heads raising the S&P to 1440, the collective we are in a heap of fundamental trouble.
If I am paying $4 a gallon for gas, and am unable to refi my home for the full amount of the ARM, I am not taking a family vacation or buying a bunch of new stuff. (fortunately I work from home, and listened to Andrew about securing a HELOC a year ago.)
I hope everyone reading this is flush with cash, and ready to jump on opportunities that will be plentiful.
Jon