As we move to the celebration of the nation’s 250th birthday, there is plenty to sit back and take stock.
The various indexes and averages are up double digits this year.
In bull markets, the crowd comes in and we are witnessing some of the largest margin positions ever.
Not saying that is bad, but if the crowd turns, it could get ugly really quick.
If you own a stock outright, you can weather the storm.
If you bought on margin, then it is put up or shut up.
While I am not bearish just yet, as you cannot ignore earnings.
As we look out six to nine months, I cannot see earnings falling.
That is the good news. The problem we have is that earnings have to be better than reasonable.
That is a bridge too far for me. I can’t see the market collapsing this year, but there is a reckoning coming.
That is, however, a concern I have had for far too long and have been wrong.
So maybe the party will go on forever.
In this holiday-shortened week of trading, we still have conflict with Iran.
I can’t figure out how you make a peace treaty with an essentially terrorist country.
I am not saying that we continue the war but 40 plus years of essentially ignoring the obvious has not panned.
I can only assume that the fact that it hasn’t had a direct impact on our country is the reason we look the other way.
It seems that this world never really lives in sustained periods of peace.
We have outbreaks of violence and insurrection on almost every continent.
Even if we don’t have outright military action, there is the promise like China’s interest in Taiwan.
The whole give peace a chance from the 60s may just be a phrase from a song.
I could go on and on about things to worry about, but I would rather focus on the move to have the general public get involved in something more than just gambling.
Beginning July 1, you can establish an account for you children.
I wish it had not been burdened with the name it has, but I applaud the concept.
You can open an account in your child’s name and the first $1,000 is gratis from your tax dollars.
This can grow just like your retirement account.
It can be invested in various index funds.
You can add to the account each year to build a nest egg or a college funding account.
Just like your retirement account, it will grow tax free.
While I doubt it, hopefully it will bring your children to appreciate the benefits of a capitalist system where investing through saving brings rewards.
I will say this about the upcoming 4th.
I am beyond grateful I was lucky enough to be born in this country.
I believe in free enterprise and the freedom of choice.
I hope we will all take the time to reflect on what our forefathers tried to create.
I don’t think we need to reinvent the wheel, we need to pay attention to what is right in front of us and the opportunities available.
Certainly there are many things that need to be adjusted.
But being a native son born in the Heart of what I consider the greatest state in the union, I am truly grateful.
God Bless America and the great state of Texas.
