Daily Investment Interpretations

November 23, 2010

2010-11-23 (Tuesday Morning): 
    The markets shrank today: Worries rattle Wall Street, and Stocks skid on Korean hostilities, with the Korean skirmishes as the principal driver: North Korea raises ante (video), followed by the fact that existing home sales are off 2.2% (Existing-home sales slip 2.2% in October ), the stain of the SEC/FBI insider trading probe spreading, and the minutes of the November 3rd Federal Reserve meeting showing reduced growth projections for the next few years: Fed: Jobless rate could take six years to fix. The only good news was:  GDP rate revised to 2.5% (up from 2.4%).
    The NASDAQ Composite fell
37.7 points (-1.46%) to end the day  at 2,494.95  The Dow sagged 142.21 points (-1.27%) to close at 11,036.37, and the S&P 500 dropped 17.11 points (-1.43%) to end at 1,180.73. Oil rose to $80.97 a barrel, and Gold jumped $18 to $1,376. The VIX climbed 2.26 to 20.63. 
    Personally, I suspect that a spate of bad news has driven the current market downdraft rather than a fundamental shift in the long-term economic global outlook. Generally, it's been my experience that when some "mini-Black Swan" event occurs, like the shelling of a South Korean island by North Korea, the markets recover within a day or two. Another stock market downer is the fact that the dollar rose sharply because of a flight to safety in the face of geopolitical risk.
    It might be worth noting that this shock to stock markets was worldwide, with European and UK indices down 1.5%. Shanghai lost 1.9%, and Hong Kong's Hang Seng slipped 2.7%.
    Wise or otherwise, I did some buying today.
    What no one is telling you about California Brett Arends argues that California is on a far firmer budgetary foundation than right-wind pundits would have us believe.
    J. Crew's $3 billion sale  What interests me about this is that it represents another public corporation that's being taken private by the very wealthy.
    Social Security offers tempting deficit target  Irwin Kellner is adamant about not cutting Social Security while the fat cats continue to get more obese.
    Michael Ashbaugh writes that: S&P 500 fails retest of major resistance.  
    Stock market futures are up a bit tonight.

2010-11-23 (Tuesday Morning): 
    Today's plunge is news-driven (North and South Korea shooting at each other... again), and may represent a buying opportunity.