Market Comments
It seems to me that the current and apparently most effective tactic in Washington is to let the frustration among Americans (and the President) build until it becomes the topic of just about every major news story and headline, driving just about every informed citizen absolutely bonkers.
Both sides are now are stirring the pot and even tossing in the shutdown of private business (at public parks and memorials) as well as recipients of Social Security (if an agreement on the debt ceiling isn’t made, my parents and grandparents won’t be getting their checks).
This whole mess is being eaten up by the media and they in turn are putting the fear of G-d into Americans with a myriad of “how the shutdown affects you” articles and blogs.
The truth is that this is only a partial shutdown where barely 500,000 government workers are going to be getting “delayed” pay even while they aren’t working. I am not unsympathetic to those who are out of work, but they will be getting back pay; so unless those workers are really strapped (which some may very well be), it should have minimal real impact on GDP.
The bigger problem is that all this “stirring” is leading to induced, unnecessary fear and possibly reduced spending by those who aren’t even affected and that phenomenon is probably forcing some small business with tight finances into trouble when they don’t need to be.
It’s really just a shame that politicians force us to bear witness to this circus act for little reason other than to strike a balanced conversation with one another. I blame both sides…period
The media fueled meltdown in sentiment continued to weigh on stocks today pushing the S&P 500 down below Friday’s close and into dangerous territory. The index containing 500 stocks fell 14.38 points, or 0.9%, to 1,676.12, with consumer discretionary pacing losses and telecommunications the best performing of its 10 sectors.
After an almost 152-point drop, the Dow lost 136.34 points, or 0.9%, to 14,936.24, with Visa and American Express leading declines that included 27 of its 30 components. The NASDAQ shed 37.38 points, or 1%, to 3,770.38.
A bearish close tomorrow should trigger some further selling in the S&P 500 and move us quickly lower to 1,664 and then 1,652.
Alcoa reports tomorrow after the bell as earnings reports begin to roll in.
I do believe that this protracted shutdown will weed out some of the less desirable stocks and create some good value in those stocks that had strong prospects before this correction.