UNEMPLOYMENT LOWEST LEVEL IN SIX YEARS

 

Now that's an eye-catching headline for you, one the current administration will certainly like.

Toss in the wonks at the Fed and main stream members of the Fourth Estate and, as country singer Jerry Jeff Walker noted in one of his songs: "We got a party going.'"

But as one of television's college football talking heads is noted for saying: "Not so fast!" This is a premature quantity over quality celebration by mostly choir members. One of the constant props for the bulls is Joe Q. Public hasn't pried open his wallet yet in this market.

Time again for another "Not so fast!"  According to today's Wall Street Journal http://online.wsj.com/search/term.html?KEYWORDS=retirement+investors&mod=DNH_S retirement investors are flocking back to the equity abattoir:

Retirement investors are putting more money into stocks than they have since markets were slammed by the financial crisis six years ago...Stocks account for 67% of employees' new contributions in March.....That is the highest percent since March 2008, when stocks were teetering under the weight of mounting mortgage defaults, and compares with 56% in March 2009, when the market hit bottom.....

A client of ours, a lady with more money and MSM television watching time on her hands than anyone should probably have, called us back then and insisted on selling everything. It took much time, effort and persuasion to get her to add to rather than sell some of her best holdings.

A while back when the S&P 500 nudged its new high she called again, not to thank or praise us, but to say she knew it all the time. That's human nature. Use it, trade it, but whatever you do, make money off of it. Behind all the companies and the numbers and talk are humans. Unpredictable humans.

Now this is hardly a siren song not to invest. It's a siren song to do your homework. The Fed  has already exploded one bubble and they got their eye on the next. 

Recall all those old westerns where the bad guy and the good guy at some point end up facing each other. The inflection point usual came with the bad guy saying something like: "Fill your hand." Well, here's it's your lap. Make sure its full otherwise those boys and girls will fill it with something you won't particularly like.



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