Market Tone Shifts

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After months and months of ignoring the obvious (that the global economy is tenuous) Wall Street has decided that maybe it does matter that Asia and Europe are tanking and it is important to U.S. equities.  I guess it is so easy to forget (NOT) that of the S&P 500 half of the companies get half of their earnings from the international marketplace.

We have written time and time again about the global situation–but not anything different than many others were writing about for many months.  No one really cared, but maybe the time is here where markets move based on a global outlook instead of a U.S. outlook (we have written time and time also that the economy IS global–everyone knows that, but watching the talking heads you would believe the U.S. is an island).

The global weakness can best be seen in the interest rate complex where rates are sinking–the 10 year treasury down to 2.38% this morning–as long as interest rates are sinking there is a realization we are global.

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All of this brings up the FED–raise rates?  Baloney—knowing what we know today the FED is not going to raise rates.  Now if there is a miracle in the economy in the next 9 months they may raise rates—but it will take a global economic miracle.  If you want a instant global depression just go ahead and raise rates.  So much baloney.

Relative to portfolios we remain on the same track–watch for bargains—shorten durations and collect dividends.  The only move we have personally made in the last week or so is that we bought 400 shares of Bluerock Residential REIT (ticker:BRG) last week and sold it today for a quick ‘flip’ and a 50 cent profit.  This was off a fall on a secondary announcement–we had written about this one earlier.  Flipping isn’t investing–flipping is boredom.

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