stocks almost always precede the economy
junk bonds seem to precede even stocks
and semiconductors precede techs generally
with semi-equipmt preceding the semis
and financials showing strength early in the actual recovery
none of the above has happened
I think we are in for a lackluster Back2School season
nothing horrible, but hardly great
I think we are in for a little uptrend showing itself in stocks by mid/late autumn this year
last Christmas was one of the worst on record
this upcoming Christmas seems iffy to me
it might show some signs of life, maybe just soso
but I think a real recovery in the economy will be evident by next spring, as we emerge from winter doldrums
remember last April?
starting as a relief rally, got steam with little more than the change in season, sun shining, summer dresses out, shirts come off, flowers blooming, thoughts of outdoor sex
I see next spring as similar, but with some real steam behind it
and the energy sector might be front & center by that time
yes, stocks precede, so we might see an autumn recovery and uptrend beginning in stocks
add 6-9 months to the Fed overeasing rate cuts, and you get autumn
remember that the first 150 bpt cuts DONT EVEN COUNT
the FedFundsRate was 150 bpt tighter than 3mo TBill at first
in fact an argument can be made that the FedFunds have been too tight until perhaps this May or June
heck, it is still tighter than 3mo TBill yield by 30 bpt !!!
so I see Fed cut response within the economy by autumn
but at the earliest
and more likely winter/spring
esp given the historically unprecedented excess capacity
there, thanks for asking
/ jim |
