Can’t Wait Until Thursday

We are coming to the end of the quarter and that is good news. This has been a difficult second quarter caused not only by seasonal factors but also by political indecision both here and overseas. There is good news however with the recent durable goods report jumping to 14%. Basic economics 101 says you must have orders to increase production and hiring, well this may be a start.  Home prices have increased for the first time since the withdrawal of the home buyer’s tax credits a year ago and sales in May increased this year over last.

What about the ending of QE2? Since this ground has never been plowed before no one really knows but it looks like with the second quarter being so weak the market has already discounted the effect. The durable goods orders last week could foretell that the market is looking forward and with the extreme oversold conditions our short term indicators are moving back into the buy range. The fulcrum point will be housing, and so now it fits together if employment improves in the upcoming months, housing sales and starts will move up, which adds more jobs to the structurally unemployed resulting in an inflection point for the markets. We have been missing these two market movers up to this point but something is brewing from the pent up demand cycle.

Looking back to last June we can find little differences on our charts as the market bottomed almost exactly like it is now. The only exception is that we are higher now than we were last year. I am staying with my discipline of not predicting markets; however my evaluations are looking positive.  Only the market knows what direction it will take but I will not be shorting it at this point. The market is looking queasy, but that is not that unusual as June comes to an end. The stock market is giving you the best value of any time in the last 30 years.  With earnings for corporate America and the amount of cash on the sidelines I am feeling very comfortable with my equity portfolios.

Thanks,

Bill

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About billriley

Chief Executive Officer, Chief Compliance Officer A co-founder and shareholder, William Riley is a 33 year industry veteran, who observed, many years ago, that over time institutional investors typically outperform individual investors while accepting less risk. In his role as Chief Executive Officer, Bill works tirelessly to make the wealth management strategies used by the world’s wealthiest families and largest institutions available to our firm’s individual clients. Bill combines fundamental and technical analysis to minimize investment portfolio risk and maximize potential returns. He uses a variety of non-correlated asset classes, including alternative investments, to minimize portfolio volatility and seek absolute returns in down or flat markets. Finally, Bill believes in a comprehensive approach to wealth management that fully coordinates and seamlessly integrates portfolio management, risk management and asset protection, trust, estate, tax and charitable planning. Prior to co-founding Riley Wealth Management ,LLC, Bill held management positions at Merrill Lynch, UBS, Raymond James, Paine Webber and J.C. Bradford. Bill founded Fort Worth branches for Raymond James and J.C. Bradford. Prior to entering the financial services industry, Bill ran his families closely held businesses. Bill’s experience operating family businesses combined with his wealth management experience makes him uniquely qualified to advise entrepreneurs and business owners on a variety of matters including complex and sensitive issues relating to business succession. Bill’s degrees and designations included a Masters Degree in Business Administration (MBA), the Chartered Financial Consultant designation (ChFC), the Chartered Life Underwriter designation (CLU) and the Wealth Management Specialist designation (WMS). A Fort Worth native, Bill is a TCU alum and active in many civic and charitable organizations. Bill and his wife, Marsha, now reside in Colleyville, and they have four grown children and four grandchildren. When he is not working on portfolios or studying financial markets, Bill can be found on the golf courses of Ridglea Country Club.
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