Last week ended with the markets pulling back.
It doesn’t appear that the pause will continue this week, but it could be interpreted as a warning shot across the bow.
What sent the market south was the President’s threat to raise tariffs on China by 100% due to their restrictions on rare earth minerals essential to the high tech industry, much less defense.
It was a moment back to April.
In the meantime, there was the release of the hostages by Hamas and all was forgotten.
It was interesting to see the interview with Andrew Ross Sorkin on CBS 60 minutes about his book on 1929, where Leslie Stahl did everything she could to get the novelist and co-anchor of CNBC Squawkbox to stipulate that the current market was a bubble and would end in a crash.
What he did say was that it would end but he had no idea when.
Recent cases like the high tech bubble of 2000 and the housing crisis of 2008 were mentioned.
The two were bear markets, but far from 1929.
I sometimes think there is a real relationship between legacy media and certain legacy corporations.
Media has moved forward into streaming leaving the legacy media of ABC, CBS and NBC behind.
Much can be said the same of such companies as Intel and the Detroit automakers.
There is a natural evolution in business.
The strong overtake the weak and the innovative pass up those who don’t change fast enough.
I am certainly concerned about the current level of price to earnings.
I have thought for the last couple of years that there should be a real correction.
I couldn’t have been more wrong.
This market has just moved on higher. That is not to say that it will continue forever.
The one big problem with bear markets is that it wipes out a whole generation of investors.
There are so many in the market today that can’t even tell you what a bear market looks like.
When it does come, and it will, they will be taken to the woodshed as they have leveraged themselves.
That is borrowing against their gains.
This is a great way to grow your investments faster until you have to pay it back. What we have today is many are rolling their bets over and over. As they say in Louisiana, let the good times roll.
Last Friday is a perfect example of how long this market focuses on any one issue.
Not for long and it is on to next bit of news. This market is almost ADHD and isn’t taking its medication.
There is so much out there to concern investors.
The cease fire in Gaza is at least one less issue in the Middle East for the moment.
China however will never stop being a problem, along with its allies Russia, North Korea and Iran.
We are not doing ourselves any favors with the government shutdown.
Given that I don’t rely on the government, I have had little impact on my life, but there are so many others who are starting to feel the pain.
We have allowed our leaders to leave the tracks of late.
I am old but not old enough to have lived through the depression.
I made it through the bear markets of the 70s, the crash in ‘87, 2000 and 2008. I can say that we will come out the other side no matter what.
The one thing I have come to learn is that the government doesn’t get us out. Free enterprise and inventive individuals are the real key. Our government is real necessity for defense and providing the backing for our currency.
It can’t take care of us which is our own responsibility. A bit of assistance is nice but it comes with a price.
So here you are in the last quarter of the year sitting on gains in your retirement account and wondering what to do.
It is great to say that all things will be better in the long run.
At my vintage, there is very little long run left.
This is where the reality hits. Risk brings you reward.
Can you afford the risk now?
I am betting on my family genes to carry me far enough to ride this out.
Only time will tell.