11/05 newsletter
*** Market
On Tuesday, FED bumpped up the interest another quater point to 4%. Interestingly however, SP500 did not drop, but rose 1% for the week. Can you figure out the implication? Did you know already that a Princeton professor Bernanke will succeed Greenspan? He is believed to be more mild (meaning easier to predict) than Greenspan. Who knows? Anything predictable is useless on Wall Street...
You may read some news that analysts are turning negative on the outlook. The reason is simple, 4%-6% CD yields better than SP500 YTD. Why invest in stock for all the risk and diminishing return? Go back to your bank account! But remember, print it in your heart (David Swensen mentioned this in his book) that stocks and stock market are norm-averse. It is typical that the market frustrates most people... That's what it is supposed to do for a zero-sum game.
Merck won the second Vioxx law suit. That makes Dow's life easier. But it remains to be seen if MRK can stand above $30. MRK's PE ratio is at a depressing 10... Hey, value investors!!!
--Steve
On Tuesday, FED bumpped up the interest another quater point to 4%. Interestingly however, SP500 did not drop, but rose 1% for the week. Can you figure out the implication? Did you know already that a Princeton professor Bernanke will succeed Greenspan? He is believed to be more mild (meaning easier to predict) than Greenspan. Who knows? Anything predictable is useless on Wall Street...
You may read some news that analysts are turning negative on the outlook. The reason is simple, 4%-6% CD yields better than SP500 YTD. Why invest in stock for all the risk and diminishing return? Go back to your bank account! But remember, print it in your heart (David Swensen mentioned this in his book) that stocks and stock market are norm-averse. It is typical that the market frustrates most people... That's what it is supposed to do for a zero-sum game.
Merck won the second Vioxx law suit. That makes Dow's life easier. But it remains to be seen if MRK can stand above $30. MRK's PE ratio is at a depressing 10... Hey, value investors!!!
--Steve
posted by Steve at 10:44 AM
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