We made it through the Santa Claus rally and the second trading day of the year pushed to through to positive territory.
Moreover, last week we had three weeks out of the last four ending up positive, pushing the S&P 500 to near 5000.
Needless to say, we are at record levels.
It is like everything is perfect.
The unemployment report came Friday and while new jobs were lower than expected the unemployment dropped slightly.
One could think that 2026 is off to a great start.
I cannot disagree but there are social, foreign and political issues raising concerns almost hourly.
This Administration is acting like it is on steroids. I don’t know what to think.
I agree on many fronts with their policies, but it is becoming a bit much to digest.
If nothing else, it is such a change from what we are accustomed to, whether we liked that or not.
As usual, change is unsettling.
This whole AI movement is starting to spread its wings. The need for energy is bringing new players into the fray and they are not all tech.
We are seeing movements in Caterpillar due to their gas-turbine business, along with GE Vernova.
There is movement in the nuclear power sector. Construction companies will be drawn in during construction.
There will be a need for raw minerals.
This is not to say that you should sell the Mag 7, it is just that others will profit.
I have to say that Alphabet (Google) took the challenge of ChatGPT by developing Gemini.
Some attest that Gemini is a superior product.
They didn’t protect their search business, Alphabet moved into developing their own chips to rival Nvidia.
It is difficult to jump into a company at these price levels, but this one appears to here for the long haul and is not giving up territory.
I would say the same thing about Amazon, but Walmart has mounted a significant challenge.
I admit to using Amazon but have found myself using Walmart and other big box stores like Home Depot to order on line.
It appears that an old fossil like me can learn new tricks. Heck, I take on new repair projects thanks to YouTube. I would say I find it satisfying, but it has become a necessity as most of all my trusted service people have retired and we are not replacing them with younger tradesman.
I mentioned last week that dropping interest rates will impact the market as lower yields will drive cash out of savings.
There has been talk of raising the level of government insurance coverage above $250,000.
I am not a big fan of the government getting involved in investments.
It is far too easy to spread the money around and I thought we were told that no one was saving anyway.
I would suggest for those curious enough to check that there are money market funds that pay higher rates.
This, of course, comes with more risk as they are not government insured.
I think you look for funds with blue chip companies.
It is why I use Schwab for my multiple brokerage accounts.
It has all to do with them being the biggest gorilla in the jungle.
You shouldn’t eliminate all risk, as it can seriously enhance your return, but of course, it could seriously come back to bite you.
This is why I am drawn to investing. My parents built a belief in saving and avoiding debt.
I have studied finance and economics and appreciate the benefits of leverage.
I have also seen what can happen in difficult times. The meter is always running when you borrow.
I use the power of compounding to my benefit. With savings, you can diversify according to risk tolerance.
Saving is a religion almost. It is not fun but incredibly helpful.
I understand how we are a consumer-driven economy, but I am not sure a fraction of what we spend is need rather than want.
Not suggesting a sequestered lifestyle - just judicious thought to what you do with your savings.
My father taught me a great lesson, in that you can’t buy an identity.
