The markets look to be dropping faster than a drunk girl in stilettos. With the S&P 500 testing a support level at 1300, it will be interesting to see if it can hold. News as of late seems just pitiful and political strife around the globe is looking gloomy at best. Lets list it out:
1. Debt crisis in the EU still uncertain
2. Debt ceiling political games in the US
3. Obamacare/Tax Hike uncertainties
4. Worthless jobs reports/manufacturing reports/housing reports/reports overall
5. Supply chain issues still faced in Japan
6. Oil uncertainty in the Middle East
It goes on and on. There is a hazardous chicken/egg conundrum occurring. Consumers are starting to spend less again and job creation is starting to slow again. Which causes which is up for debate, but the end result is both are bad news. Its pretty clear after the jobs report today that the market stimulation the Fed has been providing through QE1 and QE2 is lackluster in success at best. So you would think they would turn off the pumps and the flow of money would dry up. WRONG!!! Instead, our brilliant government is going to look at QE3 now.
So now you have a situation where not only is the economy limping along, but the government is nearly out of all bullets to shoot at this monster looming in front of us. The Fed's balance sheet looks as strong and reassuring as Screech and Steve Urkel combined. Corporations have trimmed just about as much fat as they can on the cost side before they start looking like Joan Rivers. Congress finds stalemate on everything, and the housing market looks as bad if not worse as it did 3 years ago. With about 28% of homes underwater and the values of those not having been slashed significantly, I am not expecting the median American family to step out on a limb and get this economy rolling again. I'm not suggesting where you put your money. But I am saying that this looks like a long long bumpy road with few pit stops.
Sincerley,
Coco
Nice first sentence, I hope that was never your wife.
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