3/01/2007

Markets: So? I don't know, as in know, what will happen. But in all the "dips" I've been involved in as a broker there is no way this "dip" is over. Lots or reasons. The Democrats are showing their true colors; protectionism, higher taxes, and a potentially horrific labor bill. There might be an auto manufacturing shutdown with the UAW being declared a winner in a non election at Toyota and Mercedes. Unlike Ford and GM, Toyota has no strings. Suddenly Toyotas will cost $1,500 more than now and the company held hostage to UAW work rules. A lot of us said good riddance to the philosophical GOP cripples in the House and Senate, but now we are seeing the potential for ruin. This stuff is not good for the market long term. There is a little known condition in all markets: All are dominated by the long term investor. When the long term investor turns short term, you can have a serious situatation. The economy is in good shape statistically but in terms of worker satisfaction, I doubt it. You no longer can go to work on the line and hope to be president of the company, or even a high executive as management seals itself from any job insecurity. You're on the line and you stay there. Foreman is the highest you can hope to go. This weakness will have to work itself out, better now than later. Don't buy stocks on index weaknesses.

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