Went to hear Louie last night in the Boston area with a few friends. It was somewhat eerily strange. He acknowledged that dividend increases of late were much smaller. He noted that economic growth here in the U.S. was slowing. He told of the oil glut and low price, and how that’s taking out a lot of energy companies, and hurting a number of financial institutions… in short, everything I’ve written about here. But, what was of keenest interest to me was that several times, he referred to the market as behaving abnormally, which was the very thing I had begun to take note of by the middle of January… and have been witnessing first-hand, pretty much since.
But, he also explained why he thought that was so, as I already had. With central banks the world over going to negative rates, money is sloshing around and finding its way here into the U.S., into our stocks and bonds.
Now, Louie is a 100% invested kind of guy nearly all the time, as he admitted that he was an optimist, as am I… the only difference is, I had switched to the ‘dark side’ on January 29, and I don’t know, if in years past, during other difficult times, if Louie ever has switched over from optimistic to bearish.
Here’s where things are at, as of about 7:45 am EST. Overseas, whether in Asia or Europe, their exchanges are mixed, some being slightly up, and others down. Our own futures are slightly up. Oil has ‘rallied’ somewhat, to $36.88. I don’t know why, but still, at this price, it’s not near enough to save the deeply indebted. O, and, by the way, I am beginning to see more news stories about no economic growth and the spiraling down of the debt issue on very widely followed news sites and sources. This going to start coming to the fore in investors and traders minds, and rile the markets, as the grim reality of what is… comes home to roost. Frankly, I’m surprised it has taken this long… Whereas, I fully expected the reversal of fortunes to commence in March, we are now in April, and first-quarter earnings season commences Monday the 11th. We’ll soon learn if those reports will be what finally knocks the wind out of our sails.
Here’s to your successful investing!
Harold F Crowell