It's been forever since I've written anything on my blog; the holidays and the end of the fiscal business year kept me pretty busy but I'm going to start writing about the markets again. There have been a lot of developments that occurred in December and already this year. Tomorrow I will go over some of these and then I'll outline what my expectations for 2013 are (stock market forecast/expectations, economic growth, housing market, etc). So far, 2013 has been favorable for stocks, especially Chinese stocks. We've been invested in the Mathews Asian Growth and Income Fund for the past 3-4 weeks and have seen good performance out of that mutual fund. I'll break down some of our current holdings and some stocks that are on our watch list.
While I've been upbeat on the stock market over the past month, I am growing slightly cautious as it appears that stocks could possibly move down in price over the coming weeks. Here are some of the reasons why this could happen:
- an aging market and economic advance (stocks don't go straight up);
- unsustainable fiscal policy (thank the politicians for that);
- the earnings cliff is upon us (corporate earnings are coming out and they don't look that great);
- it appears interest rates might start to tick up;
- the reallocation out of bonds and into stocks, as I've expected, is not a certainty - we shall see);
- Washington does not instill confidence;
- the consumer has over spent;
- the increase in payroll taxes will hurt consumer spending and thus the economy;
That being said, stocks are up again today...
