1.08.10

1.08.10 A

What’s in store for the coming year?

          We have lost 7.2 million jobs in this country over the last two years. That is an average of 300,000 per month. The rate is slowing down, and may soon bottom out. The hidden factor here is the fact that the “population growth” is working against getting back to where we were two years ago. Every month we have young people who are finishing school and need to enter the work force. Until they are able to find job they will be unemployed but not yet figured into the “10% unemployed rate”.  Home foreclosures are still on the rise and will continue so for some time to come. After all, if you don’t have a job it’s hard to make your mortgage payment. Credit card bills are also a problem that then comes into the equation. The point here is this: There is no fast fix. There are still a lot of speed bumps ahead. Don’t look for much improvement in the economy in the short run. Quarterly earnings reports start flowing this week and will easily beat last year for the most part. It is easy for a company to improve earnings simply by cutting cost. The place to look to see real improvement is the Top Line, i.e. sales.

          The government needs to start paying for all the money they have been spending, not just at the federal level but at city, county and state levels so that will mean higher taxes in most areas. Comparison shopping is already well under way. We will see a lot of “Store brands” replacing “name brands” in the shopping carts. Vacations will be spent closer to home this summer. I, personally have tried the “Angus” burger at McDonalds and for around $4 it is as good most $7 or $8 burgers at more ambient places.

          There will be times and ways to make money in the stock market this year but we must be alert and nimble at all times.

          For right now we remain 100% in CASH.

Till next time     

The MTA Staff