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Goldata Financial
Dedicated to above average returns in the stock market.
STOCK MARKET COMMENTARY
November 30,
2009
From Elliot
Goldberg, Registered Investment Advisor, Goldata
Financial
Happy Thanksgiving to all. Last week, the
holiday-shortened week, normally timid, ratcheted up the volatility but
produced a basically flat result, giving both bulls and bears additional
bones to chew on. The bulls got an enthusiastic home sales number and, more
importantly, an increase in home sales in the $250k-$500k range, more of a
“move-up” buyer and less dependent on the “no-down payment
tax-credit” buyer mentioned previously. Fannie Mae 30-year rates hit
very attractive levels (4.75%) insuring that whatever demand is out there can
get financed cheaply. Wednesday brought a jobless claims number below 500k
(466k), the first since January and allowed Mr. Market to ignore the news of
Dubai World requesting creditors to “stand still” from enforcing
payment of coming interest payments due them. European bourses were open
Thursday and didn’t take kindly to this request and sold off sharply (it
seems they make up most of those creditors) leading our Friday pre-market
futures to attempt to “catch-up” by being down significantly. Friday’s
opening was messy, but “buy-the-dippers” stepped in as they have
for the last 6 months, and little additional ground was gained by either side
by the 1pm close. The health care debate took an interesting turn last week as
skeptical observers read the conclusions of the U.S. Preventative Services
Task Force on mammograms as a warning of where government-controlled health
care could take us. For those that missed it, 40-50 year old women should
speak with their doctor about mammograms in lieu of (covered) screening and
50-75 year old women can live with every other year (covered) mammograms as
opposed to every year. In other words, a potential way to
“control” spending by de-facto rationing. Health care is personal
and choices for health care dollars can best be made by patients and their
doctors deciding how these finite resources can be best spent. Unfortunately,
this detracts from the Dem’s attempted power grab
and typical “one-size-fits-all” solution. Climate change
advocates received some “unsettling” news when reports that some scientists jiggered climate change data to
“fit” their case that global warming was scientifically
“settled”. Stories of deleted email, attempts to drop
non-supporting data and stonewalling dissenters’ requests for data are
embarrassing at a minimum and (hopefully) criminal. Conclusion:
Sovereign-debt issues such as Dubai World are spreading (Mexico downgrade,
Japan, Italy, Greece, Latvia) and have the potential to destabilize. Friday’s
open tripped some stops and allowed us to monetize some gains built over the
last few weeks and, more importantly, provided protection for Monday’s
open that has the potential to be ugly. This storm may pass as others have,
but the bears now have a new weapon in their arsenal. Sell discipline is now
more important than ever. I will be vigilant.
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