Friends
Just a thought as we begin trading this week. It seems the press is convinced that the markets are going to force Congress into action by collapsing. Perhaps, but it seems that both the stock market and the bond market don’t want to cooperate. Bond yields continue to be in a trading range with the 10-year treasury at 3% and stocks are down this morning, but there sure isn’t any panic, at least yet.
If one sells stocks, then where does one go with the money? Ironically, treasury bills, CDs and money market accounts are backed by the entity that is about to be downgraded. Flight to quality? Flight to safety? Who has a better balance sheet, Apple or the U. S. Government? Nevertheless, as awful as these government securities are supposed to be, it sure seems like everyone wants to own them. Demand is amazingly strong.
For sure, I am not saying that stocks won’t go down if the politicians continue to fumble the ball, but it seems as if everyone is hoping the market goes down so that they have the crisis they need to get things done. They may get what they are wishing for, but investors seem to be asking the question – where do I go with the money?
We’ll continue to update you with any breaking news. In the meantime remember, uncertainty breeds opportunity.
