Monument Wealth Management's "Off the Wall" Blog!

Last week was a mixed one in the markets.  The Fed’s monetary policy is still providing fertile ground for the market even in the face of weakening earnings beat rates (more below). Despite last month’s government shutdown, a much better than forecast October payroll number was just enough to push the Dow to a new record on Friday. Sweet.  But, there is something even more important in the news…come see what it is!

Well, I am referring to the general equity markets and not Healthcare.gov.  Like the gentle reminder that Kathleen Sebelius was given in Tennessee on Friday (pic courtesy of The Daily News in Memphis), I’d like to remind investors about some stats regarding the equity markets over the past six months and thoughts about the remaining two.   

The Dow Jones Industrial Average (DJIA) and the Standard & Poor’s 500 Index (S&P 500) advanced for the third straight week, and like the prior period, the S&P 500 ended the week with a fresh record high.  In the meantime, the NASDAQ Composite posted its second gain in three weeks, finishing at an index level of 3,943.  This is its highest close since September of 2000 when stocks were sliding down the backside of the Internet bubble but year-to-day this index is up over 30%. THIRTY PERCENT!  So, are we getting ahead of ourselves? Humm…maybe.  Read on.

It’s from the end of the movie when John Rambo walks off from Colonel Trautman after the POW rescue mission.  It’s similar to the way everyone probably felt last week during the shutdown and debt ceiling talks.  After all the posturing and bickering, the American people got a three month reprieve from all the Washington baloney (my apologies to baloney).  What a bunch of BUNK!  However, from the end of September until a deal was struck on October 16, the major indices all gained ground with the Standard and Poor’s 500 Index (S&P 500) and the Russell 2000 setting new record highs on the Thursday and Friday following the deal.    

If you trade this market, I will send this Marine to your house to tell you in his own special way that it’s a bad idea. 

I’d give anything for a Kardashian wedding right about now.  It would be nice to have some other buffoonary to focus on besides the circus in Washington. Sun Tzu is screaming from his grave, “Supreme excellence consists in breaking the enemy’s resistance without fighting.”

Brett Favre is credited with that quote but I suspect even he was surprised by the Fed last week when they stunned everyone, including the entire crew here at MWM, with their decision not to taper last week.  The reaction on the Street was immediate. Read on.

You never know what you don’t know.  Larry Summers seemed all but a lock to become the next Fed Chairman to replace Ben Bernanke but under what seems like dwindling support among some key Democratic senators, he withdrew his name from consideration.  The Dow Jones Industrial Average is up over 150 points on the news and the assumption is that the leading candidate is now Janet Yellen. 

It’s definitely back to school time here in the D.C. area.  The crossing guards are back and so are the mini vans. Isn’t it fitting that as the kids trudge reluctantly back to school as we head into the worst month historically of the year for the equity market?