With no major news, the market is trading relatively sideways. Several Fed members went on record, including Bernanke, and some traders were disappointed that he wasn’t more pointed discussion on the projection of interest rates — and the market responded with a slight bump in rates.
Inflation concerns (currently) remained low, with consumer prices rising 0.1% in March — an annualized 1.2% inflation rate, which is well below the Fed target of 2%. Yesterdays blog entry discussed an expected 1.2% rise in retail sales. This was actually announced at 1.6%. So economic indicators are that health is on the horizon, economically.
What troubles me is that the reports from which the entire global market is moved, are Governmental reports. Does anyone else think that this could potentially could be a little manipulated? Sure, it’s a good thing that we all “feel” good about the economy — such expectation increases confidence and spending activity, which is essential for a recovery. But, I would rather take the red pill, and build on truth. If we begin to be manipulated, it postpones the inevitable and gives an opportunity to be vulnerable to corruption.
I like the way that JPMorgan Chase & Co. announced today that “a ‘broad- based’ economic recovery boosted first-quarter earnings 55 percent.” Well, the rest of us “public” weren’t such direct beneficiaries of ‘broad based’ TARP stimulation. Even if it were the case, economic “recovery” can be hardly said to be yet “broad based” — at least not here in Florida. If you’ve not seen it yet, take a look at yesterday’s article, written by Kevin Dowd, Emeritus Professor at UK’s Nottingham University Business School. After this article, you will clearly begin to see of the need for economic prudence. One sentence in this article explains that only the banks have benefited from what he describes as Government panic to “fix” the system. (And offers a better concept.) Well worth a read.
