As January goes so goes the year has been a barometer of what the market will do over the next twelve months. I always remove my rose colored glasses when I hear this being touted by the so called experts in trying to “predict” the market. Now that we have suffered through all the turmoil of the 2010 to 2012 concerns, this month (January) has brought all kinds of better visions. Now please do not take this as bearish because my long-time observation (learned many years ago when selling to early seemed to be common), that bull markets don’t end until the diminishing fuel (money) starts to restrain the acceleration.
The Federal Reserve is still flooding the markets with cash and until we see that slowing the markets will continue to go up. One of the questions I am receiving is if it is too late to get in now we are reaching these nose bleed highs. The way I answer this is what do you consider a high? The market is still undervalued based on forward price to earnings and with rates still historically low, again I ask what do you consider too high? What I find interesting is most of these questions come from the same people who wanted to wait in 2009 because the market was too low.
I learned a long time ago you can lead a horse to water but I can’t make him drink.
Thanks for reading and please send me your comments, I love to hear from you.