Stocks Nearing All-Time Highs: Time to Jump In?

Yesterday, we posed the question whether this dull market could actually be a good thing, and answered with a qualified maybe.

It's maybe on a number of levels, ranging from time horizons to what kind of investor one is to what levels of risk one would be willing to accept to the high-end macro-view in a world with low bond yields, scary geopolitical events and the usual economic crises popping up every few years.

Today's action was anything but dull, especially for the bulls, who are enjoying one of the greatest months of January in market history.

Stocks have been up roughly 75% of the time, and, with only two trading days left, the smiles are wide from Wall Street nearly to Main Street.

The Dow is rapidly approaching 14,000, closing in on all-time highs, so just about anyone - from the casual investor in mutual funds to the heaviest of heavy hitters in the hedge fund world - who has taken the wild ride from the depths of 2008-09 to the present is flush with profits.

Those who have derided the sub-prime crisis and all subsequent crises as near end-of-the-world experiences (a view widely held on this blog), have been left with little to show other than a pocketful of gold or silver, maybe some real estate and other hard goods.

Not that there's nothing wrong with hard assets, but then stock are putting in 16% gains, like last year, one has to wonder just how long the Fed and the government can keep kicking the can down the road before everything blows up.

The best answer is that they can kick it as far as public perception will allow it. Owing a great deal to normalcy bias - in which one is comfortable with the status quo - the politicians and bankers have a huge advantage. The general public largely wants things to remain somewhat the same and they have and will put up with overly-generous swaths of greed, corruption and avarice, so the rich get richer while the politicians pay no price for their follies.

The point is that over the past four years, stocks have done quite well, and, if you've missed the move, well, hope is that you've done well elsewhere.

As long as the Fed is fixing policy at ridiculous levels, it might be prudent to wade into the waters of Wall Street, buy selectively, and hang on for the ride.

This is, however, the top of the run, though there's no guarantee that it couldn't run even higher, and, in fact, it probably will. That thinking runs contrary to the first tenet of wise investing: buy low, sell high.

The market is highly manipulated and leveraged, the politicians are tools of the bankers, but, they like stocks the most, so, it's a difficult call if going against the tide.

Bottom line is to stick with whatever strategy is working. If you're into gold or land or art or private placements, and it's working, stay there. But, if you have some play money, the returns on stocks over just about any six-month to one-year period in the past four have be easy money.


Dow 13,954.42 Up 72.49 (0.52%)
NASDAQ 3,153.66 Down 0.64 (0.02%)
S&P 500 1,507.84 Up 7.66 (0.51%)
NYSE Composite 8,935.64 Up 55.62 (0.63%)
NASDAQ Volume 2,052,649,125
NYSE Volume 4,198,815,500
Combined NYSE & NASDAQ Advance - Decline: 3759-2669
Combined NYSE & NASDAQ New highs - New lows: 459-17
WTI crude oil: 97.57, +1.13
Gold: 1,660.80, +7.90
Silver: 31.18, +0.404

Is This Dull Market Healthy?

Probably not, but maybe.

Money Daily is still experiencing computer issues, but a new computer is due to arrive by January 31.

Our apologies.

Dow 13,881.93, -14.05 (0.10%)
NASDAQ 3,154.30, +4.59(0.15%)
S&P 500 1,500.18, -2.78 (0.18%)
NYSE Composite 8,880.01, -24.51 (0.28%)
NASDAQ Volume 1,868,661,625
NYSE Volume 3,562,544,250
Combined NYSE & NASDAQ Advance - Decline: 3084-3392
Combined NYSE & NASDAQ New highs - New lows: 535-28
WTI crude oil: 96.44, +0.56
Gold: 1,652.90, -3.70
Silver: 30.78, -0.426

Stocks at Multi-Year Highs: Tide Detergent as Currency

The S&P closed today at it's highest level since the fall of 2007, a more than five-year-high, breaching the psychological 1500 level at the close of trading. That left the S&P with an eight-day winning streak, the longest since 2004, prompting claims by pundits and analysts that the market was just beginning a new supercycle bull market.

All snickering aside, a massive bull run on top of what has been one of the longest straight-up bull markets without a significant, sustained correction (46 months and counting), is a call that only the masters of the money universe on Wall Street could make with a straight face.

Whatever side of the trade you're on - and if you're short, you're dead - there's little doubt that four years of ZIRP and constant money printing by the Federal Reserve has finally yielded the desired results" a runaway risk asset market in stocks forcing forgetfulness about risk and the all-time high in consumer credit. The new bubble has been blown and American consumers are seemingly content to blow it until it bursts.

Coupled with the nascent recovery in housing, stocks as an asset class have proven the darlings of hedge funds, pension funds and evryone except the individual investor, whose memory still appears to be focused on the crash of 2008 and continuing uncertainty in the general economy.

Like it or not, however, Wall Street is enjoying one of the best runs of increases ever - not just this January, but throughout the four-plus years since the painful crash.

It's enough to prompt the fearful to get back in the game, though, with indices approaching all-time highs, it just doesn't seem a prudent entry point.

And, just in case you're not up on ghetto culture, laundry detergent - specifically Tide, made by Proctor & Gamble - has become the new currency of choice, a 150-ounce bottle redeemable on the street for $5 cash or $10 worth of weed or crack cocaine.

In the right circles, America's most popular detergent goes by the moniker, "liquid gold," and a crime spree of national magnitude has retailers locking down bottles of the stuff and putting additional security guards on patrol in the aisles.

Dow 13,895.98, +70.65(0.51%)
NASDAQ 3,149.71, +19.33(0.62%)
S&P 500 1,502.96, +8.14(0.54%)
NYSE Composite 8,904.53, +47.95(0.54%)
NASDAQ Volume 1,932,190,500
NYSE Volume 3,653,707,000
Combined NYSE & NASDAQ Advance - Decline: 3788-2649
Combined NYSE & NASDAQ New highs - New lows: 540-21
WTI crude oil: 95.88, -0.07
Gold: 1,656.60, -13.30
Silver: 31.21, -0.516

Dow Pushes Higher Again; S&P on 7-Day Win Streak

Dow up again, sixth day in a row. S&P eked out the narrowest of possible gains to extend its winning streak to seven straight, the most since 2006. NASDAQ down due to Apple being hammered.

That's it. Play nice.

Dow 13,825.33, +46.00 (0.33%)
NASDAQ 3,130.38, -23.29 (0.74%)
S&P 500 1,494.82, +0.01 (0.00%)
NYSE Composite 8,856.59, +27.93 (0.32%)
NASDAQ Volume 2,049,702,125
NYSE Volume 3,998,358,000
Combined NYSE & NASDAQ Advance - Decline: 3592-2854
Combined NYSE & NASDAQ New highs - New lows: 667-18
WTI crude oil: 95.95, +0.72
Gold: 1,669.90, -16.80
Silver: 31.72, -0.717

Dow Continues to Power Higher; Apple Cored After Hours

Editor's Note: Apologies for not posting yesterday. We had a major crash of our main computer on Sunday and have been working off a partially-impaired computer since, making life difficult and blogging an excursion into 1990s computing. A bew computer (due to arrive by Monday) should get everything back to normal within a few days.

Stocks keep climbing on hopes that the congress and the president can resolve their debt ceiling differences by passing a temporary extension (read: kicking can a bit down the road) and promising to get serious long before their May deadline (we will believe that when we see it).

The House passed the bill paving the way for an extension of the debt limit until May 19, when it will be reset to reflect additional borrowing through the interim period, voting overwhelmingly in favor across party lines, 285-144.

On Tuesday, existing haome sales came in below forecast, at 4.94M, on expectations of 5.10M (annualized). Not to worry, stocks put in another day of gains.

The Dow was the big winner today, thanks almost entirely to IBM, even though Big Blue has made the bulk of its profits over the past two years by buying back shares, thus reducing the number of shares available and making the EPS number more palatable.

Only 12 stocks on the Dow were up, compared to 17 closing in the red. Coca-Cola (KO) finished unchanged.

McDonald's reports that profits in the US were highly correlated to sales off its dollar menu, implying that either the American pallet enjoys the cheaper menu items or the American wallet is not very well-filled these days.

Apparently, not everyone is convinced that the only thing that matters is what happens in Washington. The NYSE Composite closed lower on the session.

So far in 2013, Dow Jones Industrials have finished higher on 11 of 16 trading days, including the last four straight. The average is up a whopping 675 points, roughly a five percent gain, which, in more normal times, might be good for a full year.

Caution is advised, though with the Fed pumping liquidity with every last ounce of reserve (no pun intended), the chances are that any pullback will be temporary and short-lived.

After hours, shares of Apple (AAPL) were slashed, as the company reported flat earnings per share on increased revenue (18%) year-over-year. The stock was down nearly five percent, falling below the 500 level once again.

Dow 13,779.17, +66.96(0.49%)
NASDAQ 3,153.67, +10.49(0.33%)
S&P 500 1,494.78, -2.22(0.15%)
NYSE Composite 8,828.35, -4.40 (0.05%)
NASDAQ Volume 1,687,925,130
NYSE Volume 3,764,679,750
Combined NYSE & NASDAQ Advance - Decline: 2909-3504
Combined NYSE & NASDAQ New highs - New lows: 510-10
WTI crude oil: 95.23, -1.45
Gold: 1,686.70, -6.50
Silver: 32.44, +0.262