cancel
Showing results for 
Search instead for 
Did you mean: 
Senior Contributor

OptionsEye....April 8th

Good morning.

 

As the market continues to struggle for a reason the jobs numbers were so bad on Friday we see a decent rebound in commodities overnight. It is nice to see for the first time in a while.

 

We open at 8:30 CST today and close at the old 1:15 time as well. The significance is that we will have a 'true' open in the pits and a true close at 1:15 which means we will open and close with the electronic session unlike the openings before.

 

Equities are bouncing following the far east and Japan's massive QE stance.

 

Gold really hasn't done much and hovers at $1578. Oil up about $1.00 and the 10 year yield is at 1.71%. It dropped below 1.70% briefly on Friday. The bond market is telling us that our economy is in trouble.

 

We have earnings kicking off this week with Alcoa reporting after the close. Maybe we will get a glimpse into how well corporations are doing in this slow down.

0 Kudos
3 Replies
Senior Advisor

Re: OptionsEye....April 8th

Scott, until the middle class gets some help and relief it's going to be a long slog. Top down simply isn't going to work. Until the tax code and marginal tax rates are commensurate with income, and corporate responsibility is enforced, economic improvement is going to be elusive and marginal at best. Since Congress is unwilling to do their job it ain't happening.

 

I'm lucky to be in ag at this point and just have to blush when reminded I'm a welfare queen.

0 Kudos
Senior Contributor

Re: OptionsEye....April 8th

corp cash ios record,, corp borrowing at these law rates is record.

 

equity mkt is very cheap on earnings yield.

 

midele class,,, is a struggle for some,, but largely fine for the majority.

 

a family that saves 10% over 35 yrs and invests has build capitah that earns as much as

a 2 person working couple

0 Kudos
Senior Advisor

Re: OptionsEye....April 8th

Corporate earnings don't necessarily benefit the working middle class. Real wages are still down in real terms for more than a decade. Health and energy costs are up. Consumer spending largely flat and significant unemployment. Moving from one area to another for job reasons can be difficult given the housing and health care markets. And I suspect real marginal tax rates do not favor the middle class compared to those above middle class - meaning the middle class is carrying a load.

 

A middle class person who is able to save 10% over 35 years is probably a real minority now. In some cases corporate retirement plans were wiped out as companies declared bankruptcies and the obligations were off loaded to the government at half their value. For those who retired and avoided layoffs and have Medicare coverage the situation is probably OK. But, they tend to have a majority of money in lower risk bonds or CD's which have little return now - as would be responsible financial planning. The current equities market is good - now.

 

But the consumer economy isn't doing well and probably won't for the forseeable future. Too much insecurity and less participation in the 'good times' by the middle class. Equities are not very rewarding for most people that are younger or trying to build business or responsibility and experience while having families  (which is also falling out of favor under the pressure).

0 Kudos