Daily Investment Interpretations

June 5, 2009

2009-6-5:   The markets were basically unchanged today. Everything I wrote yesterday still applies today, so I'll leave it where it is. 
    The NASDAQ Composite gained 0.6 points (-0.03%) to 1,849.42, the Dow added a paltry 12.89 points (0.15%) to 8,763.13, and the S&P 500 added 2.37 points (-0.25%) to close at 940.09.  Oil dropped a mite to $68.38 a barrel, while gold receded $20 to $963. The VIX slipped -0.56 to 29.62.
    There are expectations that the Fed will raise interest rates slightly toward the end of the year, based upon the recovery that seems to be underway. Meanwhile, inflation worries are returning. (The stock market has to worry.) This is the time to buy aggressively into the stock market. The safer investing in equities seems, the riskier it is.
    I've been much slower to invest during this cyclical bull market than I've been in the past for the simple reason that this time, the music threatened to stop. All the other recessions since World War II have been instigated by the Federal Reserve and have been under its control. But this time, the Fed fired its last bullet (cutting interest rates to 0%-to-0.25%), and the bear kept on charging. It took all the king's horses and all the king's men to stop this bear.
    I'll continue to hold stocks until the 50-day moving average goes south, or until my advisory services recommend pulling the plug.