Since the market is in a lull, this morning is an opportune time to point to an obscure but possibly revealing statistic …
More companies are now offering a 401(k) match to their employees then were before the 2008 financial crisis, when many dropped it under duress.
The above derives from a study of Charles Schwab’s 401(k) accounts. I don’t know if the data reflects an extrapolation to the whole of the US, as the article suggests, but the sample is some 1,000 employers and 1.5 million participants. At minimum, the 73% rate of 401(k) employer-matched contributions up from the 67% in 2009 seems positive.
Switching gears …
Yesterday, I went deep. Partly, the reader’s comment about my understanding of the gold market sent me thinking. The words themselves didn’t do it. I know what I know, and he is wrong about his assertion that I am uninformed and naive. No, the primary contributor to my introspection is my approach to this column. My response to the reader made me think about what I do here.
Almost every time I write the words “the market,” I think about what those words mean, as those words cover the huge world of trading and investing, a complex world that, at times, seems overwhelming. When one talks about “the market,” one is literally talking about a web of daily global interactions that number in the trillions. To understand the market precisely is truly impossible, as each day myriad data points contradict and confuse.
Each day, I look at a fraction of those data points with the goal of understanding the big picture, which then helps me ascertain where the market is headed in the broadest sense. I have found, over time, I am more right than wrong in my assessment of market direction. This has proved favorable toward making my money work. My sensibility has become that moving with the flow in the broadest sense works. In the context of yesterday’s writing about gold, here is a comparative and concrete example. The sentence below is one way to view the gold market.
Before traders get too excited they should note the small up sloping triangle which has formed in the downtrend. The price consolidation near $1,620 an ounce is the base for the current breakout. The base of the triangle is small, and gives an upside target near $1,730.
The myopic view above is not my thing; rather, I look at the broad picture as it relates to gold. I understand technical analysis is important to gobs of traders, but in my approach, the sentence below means more to me than any technical chart.
When you have countries like Portugal selling $500 million of their assets of gold in a given year, that puts a tremendous amount of pressure on the downside.
Not only does the above help me frame the gold market, it clues me into the reality of the European debt crisis. Portugal and other debt-ridden countries are making a serious attempt to curb their deficits, which points to potentially broad market movement as Europe closes in on resolving its financial crisis. As well, the sentence below is more important to me than knowing the latest trend channel for gold.
Foreign investors have been snapping up Asian stocks for the past four weeks in a row, with net buying totaling $12 billion – the best run since the first quarter of this year, according to global securities group Jefferies.
Anyway, my attitude is gone today. Expressing my thoughts in writing helps clarify my thinking. I understand what I do here is not for everyone, as myriad people who think and behave differently comprise “the market.” I also understand what I do here every day helps me grasp the big picture, which helps me make my money work. For me, this is the goal. I assume anyone reading this column, or any of the other articles on this site, has the same goal, so whatever gets you there, stick with it.
Trade in the day; Invest in your life …
