@theMarket: Tea Leaves and Crystal BallsBy Bill Schmick, 04:27PM / Friday, December 27, 2013 | |
Given that the New Year is just around the corner, brace yourself for a barrage of Wall Street predictions. Investors love to read them, despite the fact that the vast majority of forecasts will be proven wrong. Last year, I was lucky and spot on with my bullish forecast, but 2014 could be different.
First, the good news, the economy and employment will continue to grow. Despite the naysayers, the quantitative easing by the Federal Reserve Bank over the past several years was, in my opinion, a success. In 2013, we began to see the fruits of their labors. I believe the strength of the stock market this year was fueled by the gathering strength of the economy and not by what the
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The Independent Investor: Japan Embraces BushidoBy Bill Schmick, 07:31PM / Thursday, December 26, 2013 | |
It was a word rarely spoken in postwar Japan. Bushido, or the "Way of the Warrior," evoked too many embarrassing and shameful memories culminating in the horror of Hiroshima and Nagasaki. But times have changed.
On Dec. 26, Prime Minister Shinzo Abe did the unthinkable. Defying the Koreas, China and the U.S., he visited the Yasukuni war shrine. It is where the memories of 2.4 million Japanese dead from three wars are remembered. His 30-minute visit sparked outrage from Japan's neighbors who view the shrine as a symbol of Japan's imperial military past.
Last Tuesday, the Japanese government confirmed my thesis presented to readers six months ago. On Tuesday, it
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@theMarket: Fed Saves the Santa RallyBy Bill Schmick, 03:55PM / Friday, December 20, 2013 | |
This week the Federal Reserve Bank announced it would begin to taper in January by $10 billion a month. Most investors expected the markets to drop on the news but the opposite occurred. Why?
One reason is that investors abhor uncertainty. The Fed's announcement this week that they plan in January to reduce their $85 billion a month bond purchases by $10 billion removed a major psychological barrier to the market's advance. Investors now have a game plan on how and when the Fed will reduce their monetary stimulus and can adjust accordingly.
I commend the Fed and outgoing Chairman Ben Bernanke. They handled what could have been a dicey situation adroitly. Bernanke,
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The Independent Investor: What the Fed Taper Means For YouBy Bill Schmick, 05:10PM / Thursday, December 19, 2013 | |
This week the Federal Reserve Bank announced the beginning of the end of its years-long support of the financial markets. Granted, $10 billion per month of reduced purchases is a baby first step, but over the next year, the Fed is hoping they can reduce its bond buying altogether.
For the overwhelming majority of Americans, the fact that the central bank has begun to taper its $85 billion a month of bond purchases is good news. It reflects their view (and mine) that both employment and the economy overall are gathering momentum.
In Wednesday's policy statement, the Federal Open Market Committee took great pains to promise that they would keep short-term interest low until
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@theMarket: Coal in Your Stocking?By Bill Schmick, 08:15AM / Saturday, December 14, 2013 | |
The bulls can't muster enough strength to push stocks to new highs. Bears lack the conviction to stage a meaningful decline. It appears we are in a stand-off, but for how long?
This year many of the yearly investments themes of Wall Street failed to bear fruit. The "Sell in May" crowd was mightily disappointed this year. Those who warned that September and then October would be terrible months for the market were also stymied. Today, it's the "Santa Claus" rally crowd. Many investors are geared up to make a stocking full of profits any day now. They may be in for disappointment.
One could argue that we have already had our Santa Claus rally. After
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