Sweet November... well, not really: The war lingers on for purposes unknown to most and oil prices continue to rise. Credit woes dominate the financial headlines, and value stocks seem intent on extending their correction into a seventh month. Investors want a stronger dollar while lower interest rates ( and lower taxes ) are clearly more beneficial. Neither political party has a candidate that supports real tax reform for both investors and corporate job creators, nor has the counter productive United States Regulation Industry stopped growing faster than most world economies. In terms of issue breadth alone, November is becoming the worst month ( or the best buying opportunity ) since July of 2002, and possibly since October of 1987. Just who makes this good / bad determination anyway, the Wall Street institutions, the media, investment letter writers? Why are rallies considered good and corrections bad? Will we remember 2007 as the year of the Grinch or will the leaves and the market stop falling in favor of a Santa Clause rally? Only the phantom knows for sure.
Every fall, good year in the market or not, I remind my clients that the final calendar quarter is a very special time. November is particularly exciting because it hosts the convergence of four Katrina - level forces, all of which are part of Wall Street ' s conventional wisdom while none of them lead to intelligent investment decision making. And this year we have a special treat in the form of a Category Three market correction in the Value Stock sector. ( October ' 87 was a Short Five; June ' 98 through January ' 00 was a long Four. ) A five - force November Syndrome can be particularly destructive; no wonder the media is giving it so much attention... carnage at last!
0 comments:
Post a Comment