Where does the Stock Market go now?

This past week we have seen some changes in the markets due to the looming announcements by the Fed regarding how much they were going to cut the stimulus package of buying bonds to help in the support of the stock market and to keep interest rates down.  After their announcement we found out they were not going to make as big of cuts as expected.  After being in a flat pattern much of the week, after the announcement the markets began to rise again and the Dow hitting another record high.

Today there was more good news for the market as consumer spending for the month of November 2013 was up 0.5% causing the market to open on a high note.  The market is being supported in part due to your Internet Stocks such as Facebook, Twitter, LinkedIn, etc..  My opinion remains that some such Internet Stocks are way over valued and playing off their names and investors fantasy's.  Twitter remains operating in the red.  A company that losses money instead of makes money with a stock price it is showing in my opinion is a recipe for a disaster.  If you absolutely must have an internet stock in your portfolio Facebook is the better bet.  At least they operate in the black and have a genius for an owner of the company that knows how to make money.

As I sit back and reflect on the current market and our economy of the past where do I think the current market will go?  The simple answer is UP.  I see this continued rise through the spring of the year and into the summer of 2014.  Yes, as the Federal Reserves continues to cut back on the stimulus package interest rates will rise slowly, which really is not a bad thing.  Remember back the way it use to be in the 70's, 80's and 90's.  Interest rates were anywhere from 6 to 10 percent on a mortgage rate when buying a new house.  Interest rates when buying a car were about the same, perhaps slightly less.  Interest rates were a product of competition by the lenders as to who gave the best rates, not as a product of a government stimulus package.  The government survived as did the stock market and we the people as well.  The majority of our problem today is because of big business, our governments support of big business and the allowing of big business to basically determine the running of our country, how things are going to work, and by putting more and more people out of good paying jobs thus increasing unemployment rates for exorbitant profits in their own pockets.  By this I mean utilizing the "more with less" philosophy.  We work the good fast employees like dogs and make them beheld to a higher production standard even if this compromises quality to the consumer.  Also the over utilization of robotics.  Robots don't have to eat and sleep.  Squirt them with a little oil now and then is about it.  I think you get the picture here.  Until our government takes back over running the government from big business and does it correctly our country will remain in a hold pattern and not get much better and even slightly worse.

Right now in the stock market there continues some be some good stock splits to play.  But there are also some dogs splitting that you should stay away from.  Today VF Corporation (VFC) split at 4:1.  If you were in on this split I think you will be satisfied.  VFC is best know as the company that makes Wrangler and Lee blue jeans, but make many other things too.  Coming in the near future is MasterCard Incorporated (MA) that will be splitting 10:1  Currently MA is trading at about $815.00 per share.  In our world of the "Charge It" mentality, I simply don't foresee this split being anything but a BUY!  For the more aggressive person that likes mutual funds ride the big business wave since they currently control our economy with something like Amana Income Investor (AMANX) or Principle Capital Appreciation A (CMNWX).  Other individual stocks to watch are GIII and CRVL and JNJ.  I use to own GIII in my portfolio years ago.  Sold it for a nice profit.  But just because you sell out on a stock does not mean their might be a time in the future to revisit it.  I think that time is now for GIII.  CRVL is another stock that use to be a part of my portfolio as well.  I am waiting for a split announcement on this one.  I know it's history and I think it is getting close to time to be putting it back on the radar.  In the event they announce there is going to be a stock split from either of these two companies, GIII or CRVL, make sure to jump on it right away and BUY!  I don't think you will be sorry.  Well unless you make the fatal mistake of not buying after the split announcement...if they do it.

I hope you find todays entry useful information.  I want to say Happy Holiday to everyone.  Please be safe and may all your stock markets dreams come true.

Gus S.



Disclaimer: Make sure to review any information found on this blog site with your personal financial advisor before making any decisions. I am providing general information and not financial advise. I am not a licensed stockbroker or financial advisor.