All fixed!
That's how the markets are acting now that Trump and Xi have agreed not to employ more tariffs while they negotiate trade. I'm not quite sure how they plan to fix, in the next 90 days, what they haven't been able to in the past 360 but it is fun to be hopeful, isn't it? As you can see from the Chart, the S&P is flying back to 2,800, where we were in early November but still way below 2,950, where we were in early Ocober but it's only early December and now Trump and Xi only have to keep quiet for 30 days and we can all pretend everything is high and go back to paying record-high prices on stocks – Merry Christmas!
Of course a Santa Clause Rally is a time-honored tradition as it's how all the Wall Street Banksters lock in their bonuses so it was never likely we were going to end the year on a sour note – that's why we put a lot of money into our bullish positions in the last round of portfolio adjustments. Even GE is up 2.5% this morning as all the switches have been thrown on all the Buy Programs and every stock – good or bad – is on the move this morning.
When you think about it, of course, not only has NOTHING changed since last week but now we know for sure there will be no trade deal until March at best. Trump showed real weakness backing down on more tariffs since that was the only leverage he had in this negotiations and China's tariffs have always been retaliatory – so Xi has given up nothing at all and Trump has stopped fighting – how is that worth $500Bn of stock advances?
Still, it is what it is and we'll just have to see how things shake out. We're now soliday over our bounce lines but that doesn't matter unless we're still over them on Wednesday so today is very much a watch and wait kind of day, which is good – because I'm on vactation.
Be careful out there,
– Phil
