Here is what's on my mind right now;
- Clearly the market is showing some strength of late. I noted on this site about raising a little bit of cash over the last few weeks. For now I don't have big or immediate plans to re-deploy that cash. The S+P 500 had a nasty selloff. That this move up might just be a correction and not a rally to new highs has plausibility.
- I expressed a belief on earlier shows that the ten year treasury yield would start to move higher due to the reissuance of the 30 year bond causing supply/demand disruptions. Obviously some portion of this move is due to the Fed but I still believe the 30 year will put pressure on the price of the ten year as well and later in the year I think we could see 4.90% on the ten year.
- Crude oil may have found a new home closer to $60 than $70. I have not thought that $70 was sustainable but I have mentioned $50- $60 could hold for a while. $50 oil creates massive earnings for energy companies. The outlook here continues to look good.
- I have heard and read a lot of chatter about home heating bills and higher rates on adjustable rate mortgages coming to be a problem for middle and lower income consumers. This makes sense to me and if the idea holds any water we could start to see this creep in next month when November same store sales start to report.
- Emerging market equities had a rougher time than the S+P 500 but have come back strongly. I think there will continue to be solid demand for emerging market equities. Most clients have about a 6% weight in emerging markets.