By Carlos Guillen
It is simply remarkable how tenacious equity markets have been for the last couple of weeks, and today we can see more of that tenacity with the Dow Jones Industrial Average up over 40 points, more than making up for the 21 points it lost in yesterday's trading session. With little in terms of major economic drivers today, investors are focused elsewhere, looking at Europe and Japan and awaiting President Barack Obama's State of the Union address tonight.
Earlier today European stocks and the euro were under pressure after Moody's Investors Service Inc. lowered its growth outlook for some of the world's biggest economies. Moody's said it expects real gross domestic product for the eight advanced economies in the Group of 20 industrial and developing nations, including the U.S., Japan, Germany and the U.K., to be around 1.4% in 2013. That is 0.2 percentage points lower than the previous forecast by Moody's in November. Investors, however, quickly brushed off the slightly negative news, having virtually no impact on stock trading.
Most Asian markets are still closed for the Lunar New Year holiday, including China, Japan, Singapore, Hong Kong, and Korea, but Japanese markets returned from a long weekend. Helping to lift markets were comments from Economic Minister Akira Amari that suggested that he would like to see the Nikkei reach 13,000 by the end of the fiscal year on March 31, which gave hope to investors that stocks would see a boost in the near term.
Here at home, investors continue to look to President Barack Obama's State of the Union speech to see if it will be convincing enough to gain the support of the public and of Congress on his goal of "balanced" deficit reduction.
At the moment stocks are continuing to ramp higher on very little economic drivers, but volumes are still light, so a pull back is certainly not out of the question.
Small Business Bummer
BY David Urani
January's NFIB small business optimism index was another disappointment, posting a reading of 88.9, which although up slightly from the 88.0 reported in December, was still one of the lowest readings in the 40-year history of the survey. That was centered around a dismal -30 reading for expectations over the next six months.
This month's survey is particularly interesting given that the Fiscal Cliff debates late last year had crushed small business sentiment. As it turns out, the actual result of the Fiscal Cliff discussions did little to help optimism. And how can you blame them, as 2013 brings higher taxes (much of which comes from the higher income tax rates on the "rich" which also includes a multitude of small businesses) as well as increased healthcare costs and more regulations.
As it stands, more small business owners are reporting declining sales than growth, and only 11% have hired in the past few months. Taxes and government requirements remained the two biggest problems for small businesses with 21% of the tally each, followed by poor sales at 19%.
NFIB Chief economic Bill Dunkelberg unsurprisingly remains highly critical of the President saying, "owner pessimism is certainly not surprising in light of higher taxes, rising health insurance costs, increasing regulations and just plain uncertainty. The President will address the state of our nation tonight, but he apparently won't have much that's positive to relay to our small-business communityŚnot while the pall of uncertainty over economic policy continues to depress investment spending and growth."
I think your opening quote this morning said it best.
Scott on 2/12/2013 2:18:45 PM
|Charles my question is where do we draw the line. There should be a safety net but how good a net? Do we help anyone forever? Do people in Appalachia deserve less money than New Yorker? What about Hispanics in the Rio Grand valley. What about foreigners? How many starving children in Asia or Africa could we save with the money spent on providing cell phones? |
There is not enough money at a 100% tax rate to even make a dent in saving/helping everyone in need. Where do we draw the line?
James Webb on 2/12/2013 2:28:55 PM
|Listening to him gives me flu symptoms, so I'll wait for the commentaries and Senator Rubio's response. Narcissistic insincerity has never appealed to me, and I expect there will be all sorts of lyrical fantasy presented. When read from neutral print transcriptions, it will be challenging to find any truth or sense in it.|
Patricia Flynn on 2/12/2013 3:12:23 PM
|tHERE ARE MANY WHICH ARE POOR OF THEOIR OWN FAULT AND there are many rich NOT OF THEIR OWN DOING jOSEF bRUNNER|
jOSEF bRUNNER on 2/12/2013 3:38:05 PM
|Most asuredly, more of the same. Tax hikes to save the middle class, how you need the gov't to help you make decisions; because you are unable to do so, and that Capitalism is the road to hell and should be demonized along with the poor souls who toil to make the rich richer. I'm fed up with the class system invoked and just in general his bullshit. Oh, let's not forget that it is still Mr. Bush's fault|
Steve F on 2/12/2013 4:07:05 PM
|I agree, our Prince of Lies will stay true to form. He will surely continue to feed his constituency with his pied piping until he has fully enslaved them for life.|
Anyone with functional gray matter knows that the vast majority of his constituency are broke through their own fault. They do not know how to handle money. They waste 90% of what is given to them. There is not enough money available to provide enough to cover the waste and raise a tenth of them above poverty, because the poverty stems from faulty character. There can be no freedom from want when the source of the money is anything other then one's own labor. Funds given are not valued and are typically wasted.
I had friends who took the lead in ministering to the Katrina 'victims' who came to NE Dallas. They organized a effort to provide shelter and food. They soon lost heart, though, when they saw most of these supposedly destitute people throw away the healthy food they were given and demand McDonald's food instead. These 'victims' were not only not raised by the charity, they were arrogant beyond belief and appreciated nothing. The poverty was engrained in their spirit after being told how much they deserved it because they were victims.
Bob G on 2/12/2013 5:14:10 PM
|I certainly don't expect any soaring message from Obama, unless he uses soaring language to sugar coat another one of his great deceptions. I do expect him to demonize the Republicans and the sequester bill he himself signed. I think the impact of sequester, if it happens, will be anti-climactic. I plan to DVR both the SOTU and the Westminster Dog Show, and then watch whichever one turns out to be more interesting. Rubio's rejoinder hopefully will hit the mark.|
Dennis Howard on 2/12/2013 5:57:03 PM
|That if his lips are moving he is lying. |
There is nothing that he knows or can impart that will contradict the fact that he is economically illiterate.
He will attempt to convince us that he has the correct socialist agenda and knows that he can take from those that have and give to those who won't.
Greg McLeod on 2/12/2013 7:09:18 PM
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