In This Issue:
The Economy Is Bad, But Stocks Are Priced For Worse
Stocks Outshine Their Competition
Behold The Halo Effect
A January Bounce Seems Likely
Energy And Foreign Growth Are Positives
We May Be Halfway Through The Economic Downturn
What Everybody Knows...
The Bottom Line This Week
week we received additional signals that a bear rally is probably in the works.
During the five day period, investors were treated to a smorgasbord of bad
news. Congress turned thumbs down on bailing out the Big Three automakers.
Unemployment surged to a 26 year high. T-Bill returns dropped to essentially
zero. Many bellwether companies issued earnings warnings. Several firms cut
their dividends, and investors were shocked by a $50 billion hedge fund
what did the market do? It barely budged. The Dow eased down less than 0.1%.
The Nasdaq actually rose 2.1%. The market was also strong during the first
three days of the current week. In our opinion, such resilience in the face of
disturbing economic events indicates that investors are probably getting ready
to do some buying.