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Afternoon Note

The Market Does Bleed

By Charles Payne, CEO & Principal Analyst
5/17/2017 2:00 PM
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Many old timers and curmudgeons (not always, they say) have griped about lack of fear and lack of volatility; however, today they should be thrilled- we’re getting both in spades.   The VIX, the so-called ‘fear index’ is up 32% today, yet, still down almost 4% year to date. 

http://markets.money.cnn.com/services/api/chart/snapshot_chart_api.asp?symb=VIX

I always welcome these type of developments and continue to think that buying dips is the best way to make money. So, like good farmers from time to time, we welcome rain. 

That being said, it’s all about key support points for the market indices and also a shift in the narrative in Washington, D.C., which to me, is the greater issue.  I’m not concerned about mainstream media stories built on anonymous sources and memos that may not exist, my concern is that the GOP can’t get on the same page.

 I’m not sure when the street would give up on healthcare, tax reform and infrastructure happening in 2017 (I’m not modelling for it, but I think it will happen in 2018 with parts of tax reform retroactive). The economy is moving, and there is no reason for the market to crash based on fundamentals.

The good news, the market bleeds as investors flee and there isn’t irrational exuberance. On the contrary, there hasn’t been any real news this week to warrant today’s selloff.

Conclusion

You’ve missed the rally going back to the bottom of March 2009, but vow to buy the next dip. This isn’t a fundamentally driven move today, so get ready, you will have yet another opportunity to make some money.

Let’s stay on the sidelines.


 

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