Last weeks wild ride on Wall Street took most neofite investors by surprise. I am happy to say the current sell-off was no surprise to us. So, where do we go from here?
Below are some comments I made in the weekly newsletter briefing;
The correction that started last week could carry the DJIA to the 12,800 level. If this level does not hold, we could see the index bottom around the 12,500 mark.
So, where do we go from here? I don't believe that last week's sell-off was the start of a major correction. The political forces behind the scenes are not quite ready for that to happen. Too many political cronies (John Snow, Madeliene Albright, etc) are heavily involved in numerous private equity deals to warrant a stock market collapse.
These private equity guys have friends in high places who have an interest in seeing the deals on the table get done. Until most of the big buy-outs are funded and closed, I believe the markets will have enough liquidity to carry them for a few more rounds before a major correction takes place.
I am currently in Maple City, Michigan, a small farming community outside of Traverse City. The weather is terrific, a far cry from the steam bath I left in Pensacola, Florida. I really don't want to go back until the end of October, but my son starts school on August 14th. Isn't that ridiculous?
I'll be back in the office Friday morning, but as always, my radar on the markets are always on.
