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Goldata Financial
Dedicated to
above average returns in the stock market.
STOCK MARKET COMMENTARY
February 17,
2009
From Elliot
Goldberg, Registered Investment Advisor, Goldata Financial
Last week, expectations were built for a solution to the banking crisis from
Treasury Secretary Geithner, but he failed to deliver. The market was primed
for a rally by rumors first started late last week, then reinforced by Obama
on Monday, that Geithner had solved the riddle and would elucidate, if only
we would wait until Tuesday. The market gave Obama the benefit of the doubt
and coasted Monday and early Tuesday. Then Geithner started speaking. When it
was clear that nothing but smoke was being blown, “sell on the
news” was given a whole new meaning and the market traded down hard
Tuesday and meandered the rest of the week. The relative performance of gold,
health care stocks and biotechs allowed managed portfolios to mitigate
losses, yet this is a small consolation. We are still waiting for the
government to set the rules and get out of the way.. The market has spoken
and it wants a firm plan, preferably including some sort of bending of the
mark-to-market rules and is willing to rally if given it. Geithner has been
against it to date, but the pressure may force his hand. The fundamental news
continues to be brutally bad, yet the market does not react to it, a good
sign of it being fully discounted into current prices. Experience tells us to
always expect the unexpected when it comes to the stock market. At this
point, that would be a plan revealed by the administration that the market
likes, resulting in a rally, the size of which would also be unexpected.
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