Thread: between now and christmas

I think we'll be rock'em into and around the holidays right into next year. Lilly pad status will pass you bye. This train is in motion and I'm still running in front of the thing.

Originally Posted by Birchtree

I think we'll be rock'em into and around the holidays right into next year. Lilly pad status will pass you bye. This train is in motion and I'm still running in front of the thing.

The bull is in charge. I can imagin Birchtree Bouncing off the walls.

Imagine this: All the prior rallies that ended at a P/E above 18 were followed by declines of at least 25%. The most recent bull market advance from the October 2002 low began at 15.3 times peak earnings, already the highest multiple on record for the start of a bull market advance. The multiple is now in the upper range where prior bull advances have ended. Don't you just cherish the wall of worry? Record earnings will lower the P/Es to keep up with stock prices. No where near a top IMHO. Snort.

Originally Posted by Birchtree

Imagine this: All the prior rallies that ended at a P/E above 18 were followed by declines of at least 25%. The most recent bull market advance from the October 2002 low began at 15.3 times peak earnings, already the highest multiple on record for the start of a bull market advance. The multiple is now in the upper range where prior bull advances have ended. Don't you just cherish the wall of worry? Record earnings will lower the P/Es to keep up with stock prices. No where near a top IMHO. Snort.

No I don't cherish the wall of worry. If they made it easy everyone would be rich. You are very encouraging Birchtree. You do calm my nerves a bit.

From Steven Check of The Blue Chip Investor: While many stocks have been rising, their valuations have not because company earnings have grown at about the same rate as the prices. Snort.

Of interest from a CNN money article.

"A recent Ned Davis Research study suggests the market could weaken between the elections and the end of the year, if the last 104 years are any guide.

That's because 2006 is a mid-term year for a second-term president. In such years, a change in one or both houses of Congress has usually coincided with the Dow gaining in the months leading up to the election, and then sputtering or sliding through the end of the year.

That's certainly been the case this year, with the major gauges rallying through a surprisingly strong third quarter and month of October. The Dow hit an all-time closing high of 12,163.66 late last month and is up 12 percent year-to-date. All of which makes the market ripe for some profit taking.

Plus, as the old Wall Street saw suggests, markets hate uncertainty and this election is dripping with it.

"The uncertainty around the election suggests that there will be a sharp reaction once we know which party controls the Congress," said William Bernhard, a political science professor at the University of Illinois, Urbana-Champaign."

We already knew this from techy......oh wait, you mean it might not have been a crystal ball after all............

Hi Folks ! Kind of new to all this but here goes. Does the Fed meet again December 13th. to contemplate a rate hike? Something to consider "between now and Christmas". Appreciate your thoughts

The Fed will meet 12/12 but will not make any policy changes until 3/07 and then they potentially will decrease rates. If they raise rates later it's not a big deal - we are still at historic lows.

Thanks Birch! I just read this online: The Fed had hoisted interest rates 17 times since June 2004, its longest string of increases in its history. Many economists believe the Fed will keep its finger on the interest rate pause button when it meets next on Dec. 12. Economists said Bernanke's comments dashed hopes - held by some in financial markets - that the Fed would soon cut interest rates. "His speech pours water on any notion of a rate cut around the corner," said Richard Yamarone, economist at Argus Research.

I have been reading your post here for a year or more and appreciate your insite and comments. Have a great one...drg

So, is the Santa rally on it's way?