Dalton — The stock market looks overbought, but it doesn’t seem as if it’s poised for disaster. That creates two questions, at least: Why do I think it’s overbought? And why don’t I think it’s poised for disaster? If you’ve been in the business for a while, knowing that the market is overbought is a bit of an art form. You can practically feel it. However, I like to think of myself as a man of science, so let’s back up my gut feeling. Since the Oct. 2, 2019, lows, the S&P 500 is up about 15 percent, which is…
Insights & Advice
Allen Harris
Don’t be in the mole-whacking business
Do you ever go home and your spouse asks, “How was your day?” and you reply, “I was busy all day but I feel like I didn’t get anything done”? Justina has those conversations all the time. Justina is the chief operating officer of a mid-sized, Berkshire-based manufacturer of contamination control devices. She is whacking moles all day long. Now that I look back, it’s a rather barbaric notion, but as a kid playing Whac-A-Mole at the arcade was a lot of fun. The point of the game was to wait for one of several plastic moles to raise its…
The first five days
Dalton — When it comes to the stock market, whichever way the year starts is usually the way the year finishes. Mostly. And 2020 is off with a bang. Since 1950, the history of the S&P 500 during election years is that, 82% of the time, it ends the full calendar year in the same direction as the first five trading days. On Jan. 8, 2020, the S&P 500 closed its first five trading days up 0.7%, suggesting that the odds are ever in your favor for a higher stock market in 2020. Interestingly, this same metric, while still positive, is…
What happens to stocks after Middle East crises?
Dalton — The stock market kicked off the new year in record high territory, looking as if it shook off the summer’s recession scares, embracing some newfound economic momentum. I’m even shaking off some of my own 2020 recession concerns and thinking that we might have another year or so of breathing room before any stock market crash. Not that we’re expecting anything gangbusters for the economy, but 2% GDP growth, which has been the norm for this expansion, may very well continue for a bit longer. That level of growth should create enough jobs so that the unemployment rate will…