Quote of the Week

Wisdom from the Orchard

The big market-moving news this week happened today as the government conducted its auction of 10-year Treasury notes. As soon as the results of the weak auction were revealed…

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The Wisdom of the Fortunate

Last Friday, May 29, the S&P 500 broke above its all-important 200-day moving average for the first time in more than a year.

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Don’t Tread On Me

Now, over the past couple of weeks the market has been in somewhat of a consolidation mode, meaning that stocks have been building what’s called a…

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The Wisdom of the Quest

Last week the market made a decided turn downward, but so far this week stocks have returned to rally mode. The big question now is: Are we still in a bear market rally, or is this the start of a new bull market?

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The Wisdom of “Still”

The ebullient rally that’s taken this market by storm has grown a little tired in recent days, as traders await the final results of the Federal Reserve’s bank stress tests. Results of the test are due to be released late Thursday, but already there have been some leaks about which banks are in good shape, and which are likely to face an uphill battle. It will be interesting to see the market’s reaction to the government’s two-month evaluation of the nation’s 19 largest banks. What these hypothetical scenarios are designed to do is determine their revenue, losses and capital needs, should economic conditions deteriorate even further than economists’ estimates.

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Comedic Wisdom

Today the Federal Reserve held its key lending rate at a record low of between zero and 0.25%. The Fed’s steady stance on interest rates came complete with a gingerly bullish assessment of the economy. Here’s the money quote from today’s Open Market Committee statement, "The economy has continued to contract, though the pace of contraction appears to be somewhat slower."

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Jeffersonian Science

Even a casual market observer can’t escape the barrage of talking heads on TV and in the print media who now are claiming that the recent rally is the beginning of a new bull market. Now I admit that the substantial surge in the market over the past six weeks has been much stronger than I expected, and if this is the start of another bull market, then I’ll admit it when the time comes.

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Tax Day Wisdom

Today is tax day, a dreary day for most Americans — especially if you have the skills, ability and fortitude to earn a substantial amount of money each year. Yes, this is the day the government says, in essence, pay up, sucker! Now you’ve probably heard about the many tax "tea parties" being held today throughout our nation. I’ve read that there were going to be well over 1,500 tax protests held around the country, with at least one taking place in all 50 states. Where I live in Orange County, Calif., I’ve heard there will be over 50 separate local tax protests. Honestly, I can’t say that I blame anyone for feeling the need to protest the high tax burden imposed by not just the federal government, but also by state and local governments.

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The Wisdom of Science

This week started out with a pause in the recent market rally. However, today the play button on the rally seems to have been pushed once again. I think Monday’s pullback makes sense, especially in the context of the big run we’ve seen in stocks during the past four weeks. I also think that we could see a continuation of this bear-market rally, possibly all the way up to the 200-day moving average.

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Churchillian Wisdom

It’s April Fool’s Day, and this year there are plenty of left-wing fools in London yelling, screaming and carrying on over the state of the world economy. Now it’s tempting to make a joke here that I am not referring to the protestors outside the walls where the G-20 summit is taking place, but rather to the heads of state that seem intent on doing their best to prop up the world financial system.

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