Well, it appears we are back to more of the same with the market. Yesterday’s eked-out gains are met today with a mild rebuff; yet, there is a slight difference. The market is now trading with higher floors and ceilings. Unless the market retraces significantly in the near future, we might have arrived at a “new normal.”
That phrase reminds me, I need to have a little fun. You know the fun I mean, right? Look out celebrity analysts; I am out to have some fun. Actually, I will have some fun with just one celebrity analyst, one of my faves – Mr. PIMCO himself.
- Pimco, an investment firm that manages the world’s largest bond fund, said on Tuesday in its three-to-five-year outlook titled “The New Neutral” that low central bank interest rates underscore an end to bull markets in financial assets.
Okay, so the “the new normal” is no longer the phrase of choice for PIMCO’s financial world view. We now have “The New Neutral.” Okay, clever enough, I guess, but, clever or not, should we pay attention based on Mr. Bill’s recent history of predictions??
- Gross’s prediction of an end to bull markets over the next half-decade came after his call in May 2013 that the bull market in bonds likely ended on April 29, 2013. He also said in a monthly letter to investors dated August 2012 that the “cult of equity is dying” and that lower returns on stocks and bonds would mean individuals would have to work longer to save for their retirements. Those predictions have failed to materialize.
Actually, that was fun and educational. It is a reminder that specific market predictions going out years are suspect, to say the least. It is better to watch, wait, and then play, or not. Speaking of playing, a reader would like to know if BofA is playable? I like the question because I played BofA for several years as it climbed from $5 or so to $16.
- What are your thoughts on BAC? Will it hold the $15 support?
I haven’t really paid close attention to the stock since I stopped trading it around $16, but, at its current price, I find it worth my time to watch it again.
- Huntington Bancshares continues to boost its Michigan presence with an agreement to buy 13 Bank of America branches which follows a recent deal for the purchase of another 11 branches in the state.
BofA in my book is still a solid company. Yes, it has some legal issues, which is why it has not been able to hold or rise above key levels in the $17 zone, but it still has two things going for it. It is BofA, the second largest bank in the US and the 12th largest in the world and it is cleaning up its act to prepare its future. So, to answer the question, it may well slide further, well below the $15 level, and if it does, I will be there waiting for it.
I am still working on biosimilars, and, frankly, what I am finding is piquing my interest more and more. I found a newsletter I like regarding the subject, so my education is now in full swing.
http://www.biosimilarnews.com/
I also found a stock to watch (AVNR). It is right in my wheelhouse – under $10 with movement up and down. Today it popped (of course) right after I put it on my watchlist. Well, more to come with biosimilars, for sure.
- The regulator of Fannie Mae and Freddie Mac laid out plans for the government-run companies on Tuesday that could make it easier for Americans to obtain mortgages, marking a sharp departure from a predecessor who wanted to aggressively shrink their role in the housing finance market.
Seriously? I am all in favor of folks owning their own home, but this guy’s memory is, apparently, very short. Didn’t all the problems that led up to the housing bubble and housing collapse in 2008 start with this idea we need to make buying a home easier? Again, seriously?
Trade in the day; invest in your life …
