As we approach the sweet spot of the calendar, the seasonal momentum takes hold. Historically speaking, the last six weeks of the year offer some of the best gains bulls see all year long.
So is now a time to get bulled up or remain with a cautious view? There are very few times where it seemed ‘right’ to go all in – THIS IS NOT ONE OF THEM. Conditions are improving but I’m moving forward with guarded optimism and keeping a very tight leash on trades.
As a reminder – WE ARE IN THE MOVING BUSINESS, NOT THE STORAGE BUSINESS. Remain nimble and ready to move at all times.
The macro issues that are prevalent in Europe and other areas continue to move markets. Why, last week it seemed we were in the clear, then Japan intervenes with the yen and the Greek PM decides to put a referendum out to the people.
That was a 1-2 punch that took out 5% in just two days. Just this past week there was fear Italy would become the latest casualty (again). Yields rose sharply on their 10 yr and caused some extreme bearishness – overnight!
Clearly the fear is warranted as any misstep along the way cold be severe punishment. However, it seems the world may just barely skirt this latest ‘end of days’ assumption. Be wary of sentiment.
A tribute to our Wonderful Vets! Thank you! Never forget
The sad part of it all is the lack of attention being paid to what is really happening in our economy. Without much fanfare companies are seeing some good things happening on the horizon. I can point to several pieces of evidence – anecdotal and general ‘big picture’ views.
Caterpillar just announced a big acquisition of a mining firm in Hong Kong, and they will also build nine new plants in China. Rail cars around the country are full and delivering goods, while coal supplies are at their lowest in five years. Fertilizer demand is robust as pricing levels are very sticky.
Retailers are seeing a resurgence in their sales, and just last week UPS said they expected to see the busiest holiday shopping season ever – and will hire 55K temporary workers for the season. I think Amazon.com, Walmart and others might be a reason. Export prices showed a surprising gain recently, solidifying growth overseas.
Let’s face it; these facts are not part of the end of a business cycle. We can talk about half a dozen other items but unless the macro issues resolve then any of these are moot. I sure hope we don’t waste a great opportunity.