WHAT THE MARKET IS TRYING TO TELL YOU
In the interest of full disclosure, I must tell you that I am no Wall Street genius. I'm still the lovable truck driver/hack writer that I've always been. That being said, the market is not nearly as complicated as people make it out to be. Playing the market can be very tricky, but watching and reading it is not that complex.
Think of the Dow, S&P, and NASDAQ as the voice of our economy in general. Other indicators such as gross domestic product (GDP) and the unemployment rate are also a good way to tell where the economy stands, but they lack the immediacy of the market. Unlike the market, the GDP and unemployment rates are not updated daily-let alone hourly, making them a "lagging indicator" and subject to many more factors over a longer period of time.
If you want to know how your economy is feeling that particular day and even that particular minute, the market is your best "bet" (no pun intended).
So, what is the market telling us today? Well, let's just say that if markets could talk, ours would be begging for mercy. The market is not happy...because it's terrified. The market is shaking in it's boots because it sees what's coming. It sees the seizure of capital by government. It sees the nationalization of industry. It sees the coming of universal (socialist) health care. It sees bailouts. It sees banks not being able to recoup their investments when they are no longer allowed to foreclose on defaulted loans. It sees people knowing they can get away with not paying their mortgages. It sees higher taxes for those who provide jobs, so consequently it sees that cost being passed onto the consumers...ALL the consumers. It sees that resulting in more layoffs, higher prices and business closings. It sees fewer "big ticket" items being purchased. It sees how the new leadership villainizes successful achievers, and profit in general. It sees expansion of welfare diminishing the incentive to loin the workforce. It sees trillions of dollars being thrown down a bottomless government pit with no "hope" of stimulating growth, or prosperity for anyone other than government entities. It sees the socialist agenda gushing from the White House. It sees the intervention of government into every facet of the private sector through excessive regulation and bailouts. But most of all, it sees no reason to be optimistic.
As the new administration goes out of it's way to make this the most business repellent country on the face of the earth, there are still those who are holding onto the whole "hope/change" mantra. Unfortunately for them, they too are going to enjoy the consequences of fiscal naivety. For now though, they are quite comfortable with the child-like notion that President Bush had single-handedly screwed up the economy so bad that the market is incapable of moving on, or that his predecessor is is incapable of fixing it without destroying it first. They're totally cool with Obama doing ten times as much of the same things that Bush did to create this "crises" in the first place, namely spending the tax payer's money. They have no problem dismissing the fact that Obama has ascended to the Presidency at almost the exact same rate as the fall of our economy.
You see, liberals somehow believe that the business community became successful by being stupid, or by not understanding how things work in the real world. They blindly follow a man who's never run a lemonade stand, and brush off the concerns of people who've built empires as "greed" or whining. Rooted in simple jealousy and bitterness, Obamoids scorn the businessman and support those who would make it harder - if not impossible for him to operate his business, then they turn around and complain when jobs become scarce. Insanity.
So for those of you who were shocked to see the DOW go into the six thousands yesterday, all I can say is "strap in...you ain't seen nothin' yet. My prediction is: 5000's by the end of March. Barring any major attitude adjustments at 1600 Pennsylvania Avenue of course.