We are in the midst of the Santa Claus Rally which encompasses the last 5 trading days of the year and the first two of the New Year.
Historically, this has been positive almost 75% of the time.
However, the last two years have been negative.
We have not had three years in a row of being negative.
The first day on Dec. 24 was only a half-day of trading, but it pushed the S&P 500 to 6932 a new record high close.
Some were concerned earlier in the week as the GDP came in above 4%, leading to concern that the Fed may hold off lowering interest rates for some time.
Trump is keeping the pressure on the Fed and plans to name a Fed Chair who will listen to him.
While that may happen, it still is a committee of governors and not a dictatorship.
I wish Congress and the Administration would focus on lowering the debt.
The Administration contends that a growing economy will provide enough revenue to slash the debt.
While I tend to agree with that theory as it happened during the first term.
The problem is that they way over spent.
For those suspect of stocks, the precious metals markets are on fire.
The predictions of further gains are remarkable.
This is based on concerns of the growing Federal debt.
It is impacting the value of the dollar.
The consequences of the world losing faith in the U.S. dollar would be devastating.
Being a fiat currency is a tremendous advantage for the U.S.
I still believe the dollar should still be backed by gold but that boat sailed, which opened up the gates to Congress spending money.
There are projections for where gold and silver may achieve in 2026 that one would have laughed at previously.
Not so laughable now.
The New Year will be built on the back of AI.
That keeps the Mag 7 as the leader of the pack.
The news coming out boggles the mind.
You have self driving cars in Austin serving as taxis.
I can tell you personally that it is shocking to see a car moving through traffic on Lamar with a passenger in the back seat.
I had to follow it just to watch.
That passenger was much braver than me, but the car delivered that passenger unscathed.
The future is already here, no matter whether you want it or not. Just get ready to go along kicking and screaming.
This is the only time that I am glad to be of an old vintage.
Most of this change will take full effect after my passing.
You have to understand that I drive a diesel truck, manual transmission, with roll-up windows and manual door locks.
The only electric accessory is cruise control.
My other vehicles are so old that I have antique plates on them.
There will still be a place for those of us reluctant to move forward.
We have, however, adopted cell phones and computers.
It is remarkable how the future can become the current whether we like it or not.
Not all things get thrown in the trash.
The fossil fuel industry will go strong as it meets the energy needs of AI, no matter the impact on the climate.
I mention this as these energy stocks provide a respectable dividend.
With rates going lower, you have to consider something with a little more risk than we have experienced with banks providing interest accounts with higher yields than inflation.
It is getting real close to break even. I rolled over a CD probably for the last time as it was at 3%.
That will be a losing proposition.
I will say that 2025 brought many changes both welcome and annoying.
I would like to be believe that 2026 will be as rewarding as the last couple of years, but the odds are not with me.
Markets don’t go up year after year.
Maybe I should say they haven’t historically.
One never knows, maybe it is different this time.
Not that I still remain optimistic.
Part of the reason is that you have so many alternatives for your savings.
Those fearful of the market have precious metals, collectibles and real estate.
I have positions in each but hang my hat in equities.
Happy camping fellow investors.
