Richard, The supply and demand story has been the right one for the past 3 years. All of the other stuff about growth and a great economy, etc., are sidebars. Basically, the market went up and the herd decided to buy after it went up. They are still doing so. But several things hurt this scenario. The foreigners are pulling out as the dollar meets the Kryptonite. And they will do so more energetically if the Euro gets its act together, as I suspect it will. And higher bond rates, even with the bond up today, are hurting that market that is the major competition for stocks. As I write this, the bond is yielding 5.32% after hitting 4.75% just a few weeks ago. That is a bear market, not a bull market correction. So, yes, there has been more supply than demand to push prices up in the past 3-5 years. But I see both a decrease in demand and certainly an increase in supply on tap to kill that force.
Demand outstripped supply for most of the past 5 years. Right now, new securities are being created at a record rate. When suckers are biting, the scamsters issue stock.
I lived in St. Paul from 1981-1983. And you are right about Houston weather. High 74, low 59. Maybe an afternoon shower.
MB |
