STAY DILIGENT

Here is a good, succinct discussion of some of the potential problems going into 2016.

marctomarket.com/2015/12/four-drivers-of-investment-climate-in

We have touched on all of them several times--China's transition to domestic consurmerism versus buying everything in sight; the fungibility of commodities and emerging markets, where you see one the other is close by; the dollar and the yuan; the latest Wall Street betnoir term, divergence; the EU and Japan and you can add the Tawain central bank that eased the money supply to a long list of others; the Fed, interest rates and their impact.

There is little doubt the strong U.S. dollar and the spreads in the bond market it creates are worth watching. Of import too is it's impact on the earnings of multinationals. Then there is gold, the one relic much of the investment community loves to hate.

So where will the surprises come from and what might they be? The EU, heaven forbid, given another tragic terrorists attack could become a smoking hot political cauldron of separatism, spreading the fear and further doubt about EU viability.  And the same this election year in the U.S. Though it's hard to see how, inflation might also surprise. Those easy money spigots were open for a long time and in several places.

With China apparently declaring it's no longer the commodities buyer of last resort and the Fed opting, at least for the nounce, to purchase a ticket on that train, who knows what could happen? So enjoy the read and stay diligent in 2016.