Market Comments January 23, 2009 TSP Fund share prices as of: 01/22/09 Fund - G Fund F Fund C Fund S Fund I Fund 12.7575 12.5273 9.5740 11.1614 12.4111 $  Change - 0.0008 -0.0084 -0.1470 -0.2883 -0.3162 % Chg day - +0.01% -0.07% -1.51% -2.52% -2.48% % Chg wk - +0.04% -0.78% -2.64% -4.56% -5.38% % Chg mon - +0.13% -0.42% -8.24% -8.56% -12.94% % Chg 2009 - +0.13% -0.42% -8.24% -8.56% -12.94%   L2040 L2030 L2020 L2010 L Income 11.5013 11.7512 12.1154 13.4557 12.5516 $  Change - -0.1920 -0.1704 -0.1452 -0.0761 -0.0480 % Chg day - -1.64% -1.43% -1.18% -0.56% -0.38% % Chg wk - -3.17% -2.74% -2.26% -1.06% -0.71% % Chg mon - -7.91% -6.91% -5.78% -2.73% -1.82% % Chg 2009 - -7.91% -6.91% -5.78% -2.73% -1.82%

Today's Comments (Short Term Outlook)

Looks like late January can go either way Stocks pulled back again yesterday after Wednesday's big relief rally.  The TSP stock funds dropped 1.5% to 2.5% on the day, while the bond fund dipped slightly. We have seen some good earnings reports, and some poor ones, and the market doesn't seem to know which way to go.  Up on IBM and Apple, down on Microsoft, AMD, and ebay.  Taking a bigger picture view, we know the trend remains down despite some nice rallies being thrown in there.  The S&P 500 chart is in tough shape but a move above some resistance levels and it could be back in business.  Money is certainly being thrown around and like Bush, Obama seems to be on board the spending train.  But will bailouts and stimulus packages help?  Maybe eventually, but not so far.                         Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk The housing market index is basically a mirror image of the S&P 500 although the moves on the HGX are more magnified.  The housing market may be the key to an economic recovery, but what will it take to straighten out the mess?  Is it just a matter of letting things fall where they may and letting the market weed things out, or do we need more bailouts for homeowners?                          Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk We have seen over the last few months that there is not a lot of confidence out there right now.  Who can we trust to do the right thing?  The government?  I'd like to think so, but... Whether its banks who took bailout money but are not lending, a Treasury Secretary who failed to pay taxes, or CEO's like John Thain who spent $1.2 million redecorating his downtown Manhattan office and also taking and giving huge bonuses just before reporting a $15 billion dollar loss in the 4th quarter, there is no shortage of reasons to not have much faith in the system or a recovery.  How about the Madoff scandal?  Another $50 billion rip-off.  So, obviously confidence is not high, and the market will likely struggle until that changes.  It will most certainly recover one day, but in the meantime, I am still protecting my nest egg until the charts (the only thing I really trust) tell me otherwise.  And don't forget, the market will likely turnaround before we see the signs of a recovery so be ready and keep an eye on the charts. Our TSP Talk Sentiment Survey came in at 37% bulls, 50% bears for a 0.74 to 1 bulls to bears ration, which keeps that system in the G-fund.  I am surprised that the ratio is that high considering the Dow was down about 240-points when the survey was posted.  Wednesday's big day must have generated a few more bulls. That's all for today.  Thanks for reading.  Have a great weekend!