“We have come a long way, baby.” At one time this now famous slogan was tied to the women’s movement in the 1960s. I guess women smoking slim cigarettes was something of a breakthrough for women’s rights. Okee dokee.
Putting Madison Ave’s ridiculous marketing campaign aside, the slogan has some real meaning today when you read the following statistic. Remember, the ultimate collapse from 2008-2010, the one the US government did not backstop effectively (at all in truth), the one that did the most damage to the US economy, was the housing collapse.
- The number of foreclosure filings last year dropped to the lowest level since 2007, declining 26% to 1.36M properties, RealtyTrac says. The figure is less than half of the peak of 2.9M properties in 2010.
The above is important for many reasons, not the least of which is the nightmare for so many is receding. For the US economy and, thus, the market, it is important because it signals a potential flashpoint for returning to recession is passing.
Just two short years ago in January the voices of doom were predicting that foreclosures that year would doom the nascent economic recovery. Oh so many highly-educated financial big wigs prophesized the end times with the coming flood of foreclosures. Oops!
Speaking of predictions … I know I just wrote about the next doozy, but I just can’t help myself as the words so strongly punctuate a scary market reality – so many know so little.
- Retail sales rose in December, capping what may have been the strongest quarter for consumer spending in three years.
How the breathless media goes from telling us in October the holiday season is not likely to impress, to November’s early holiday sales fell short of expectations, to December’s pre-Christmas shopping was weak, to the above is mind boggling. The breathless media’s problem is that it doesn’t report reality; it reports the sensational from those who supposedly can predict, you know, the oracles of Wall St and other such bastions of financial wizardry.
Anyway, the market today is giving us another buying opportunity, so take it. All the talk about market tops and Fed tapering, and whatever else is in the so-called news is just talk, more of the same from the “ones in the know.” The reality is that US economy is getting healthier quarter to quarter. The reason is the US consumer is spending money. As long as US consumers believe things are getting better, they will continue to spend money, which means more revenue and profit for business.
- Americans in January became the least pessimistic about the economic outlook in five months amid signs the expansion was gaining momentum heading in 2014.
- The Philadelphia Fed survey’s broadest indicators for general activity, new orders, shipments, and employment were positive, signifying continued moderate growth. The survey’s indicators of future activity moderated but continue to suggest general optimism about growth over the next six months.
Okay, I have just one more reason for you to consider today a buying opportunity. True, it is not directly related to the US economy, but it does affect a couple of important US companies, one of them I suggested buying some time back. It also points to more economic recovery in a key global market.
- European new-car sales surged the most in almost four years as price cuts by producers such as Renault SA (RNO) and Ford Motor Co. (F) helped generate a recovery that industry executives say will last in 2014.
Finally, speaking of the Fed (somebody somewhere always is these days), its Beige Book report end stops my writing today. The report probably is sending many believers into panic (QE tapering will come again) and they are selling, but don’t be fooled. An improving economy is good news. Now is the time to buy and hold, buy and sell and buy and sell, or do both.
- The Federal Reserve said “moderate” growth across most of the country last month was buoyed by gains in holiday spending by consumers, an improving labor market and strength in manufacturing.
Trade in the day; Invest in your life …
