This morning I saw and article with the title, “Obama Met Boehner on Sunday over Fiscal Cliff.” I skipped it. Does anyone really care if they are meeting and when? I say, just get the job done so we can all see what the US economy and the market will do without the sword of Damocles hanging above them.
Speaking of that nonsense, the US consumer confidence report for November is out and it took a dive. The interesting thing about that is all reports about holiday spending are good. This tells me that the so-called fiscal cliff concerns the US consumer, but not enough to keep him or her from spending money. Good news for the US economy and the market.
China is reporting another round of positive data. If you are not exposed to the Chinese market, consider looking at it now. Check out the recent movement.
- Hong Kong stocks climbed, with the Hang Seng Index (HSI) capping its highest close since 2011, as U.S. and Chinese data signaled improvement in the world’s two largest economies.
The reason the Hang Seng and other indices are doing much better is the positive Chinese data I mentioned a moment ago.
- Growth in China’s factory output and retail sales jumped to eight-month highs in November as consumer inflation bounced off 33-month lows in the latest sign that its economy is snapping out of a protracted slump. Annual growth in retail sales also surprised by jumping 14.9 percent in November, while fixed asset investment rose 20.7 percent in the first 11 months of the year, a shade below forecasts.
Jumping to another point …
In the game we play, numbers fly everywhere. Sometimes, those who write about the numbers do not give a context for the numbers. This can be a problem. The quote below addresses this issue in the particular context of mutual funds, i.e., the movement of money in an out of the fund as an indicator of future market movement.
- Barron’s had multiple references this week to the fact that more than $100 billion has left equity funds in 2012. As I read it, that is a net number. That certainly seems like a very big number but if the context is traditional mutual funds and there is (was?) $10 trillion in mutual funds then this works out to a 1% reduction.
Now, when you look at the $100 billion number in isolation as it relates to money out of mutual funds, it is quite huge, but in context, it is not so big, as the other points out. The important message for you as a market player is not to settle on “the number” set forth in the media, as the media often does not do a good job of creating context. Do your work and put the numbers in context, no matter what the numbers are.
Trade in the day; Invest in your life …
