Market condtions now

The long-term outlook is good.
1. The two wars will finally be finished within 3 years. No presidents (with Bush as the recent exception) will want to start another one with the bad memory unless Israel has its way. I read from magazine we exported $1.4 M honey in a year - guess how much we spend in these two wars in a week.

2. Most economic data look better than before. However, I'm just a little suspicious in the employment data, esp. in a election year.

3. We're still rich in resources particularly per capita wise. New discoveries could be more than twice the Arabian reserve but we need new technologies to extract them.

4. We still have the best high tech in researches and environment to flourish them.

The problems are:
1. Energy cost. If we open to more drilling, the pipeline... then problem may not be a long-term problem.

2. EU crisis could spread to our shore. The bright sides are 1. EU in most cases are our competitors and not our best traders (which go to China - a surprise to some), 2. Moving some assets to our way.

3. The uncertainty of corporate profits. Apple and its suppliers are only a small percentage of all corporations. They have been cutting to the bare bones and too much cuts could have long-term adverse effect.

4. Depending on how you calculate/estimate, Federal liabilities/interests/entitlements total is close to GDP. Printing money at the max. is good for no one except the politicians.

5. Newton's Law. I expect the market will take a breather of 5-10% correction. Your guess is as good as mine.

6. Next year the tax will be higher. I expect a sell off during Dec. to take advantage of the low long-term capital gain tax.

7. China's soft landings on several fronts like housing... and conflicts with US.


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(c) TonyP4 2012. Written in 3/16/12. Last updated in 4/29/12.

Disclaimer:

Do not gamble your money you cannot afford to lose. Past performance is a guideline and does not guarantee future performance.

All my posts are for informational purposes only. I'm not a professional investment counselor. Seek one before you make any investment decision.