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November 2009 Market Review

Posted by Larry Doyle on December 1, 2009 6:48 AM |

The magnitude of market returns across virtually every segment (equities, bonds, currencies, and commodities) leaves me with one overriding belief: DON’T TRY THIS AT HOME.

To the extent that you have funds invested across asset classes, once again smile at the returns but do not think for a second that they are a precursor to a robust rebound in the economy. In fact, all you need to do is see what is happening in Washington this very week to get a pulse on the two most economic forces in our nation.

Today, the Obama administration released a revamped effort to support our housing market which continues its descent. I highlighted this initiative in my post yesterday, “Obama’s Socialized Housing Policy: If at First You Don’t Succeed….Try, Try Again.”

Later this week, Obama is hosting a Jobs Summit given the fact that the unemployment situation shows no signs of improving anytime soon. I highlighted this dynamic in my piece, “Jobs is Job # 1.”

What is going on in the markets? The same story. Excess liquidity provided by Ben Bernanke and Tim Geithner is bubbling over into virtually every asset class. While many money managers, foreign central bankers, and even some at the Fed have raised the question of asset bubbles, these situations can persist as long as the source of fuel, that is the Fed’s easy money, continues to flow.

Can you call a top to something that is already out of control? It would be purely guesswork. All this said, don’t get complacent and think for a second that the economy is not fragile and filled with risks.


11.30.2009 Market Review

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