Thankful For Progress
Weekly Update – November 19, 2012
As you gather with your family and friends this week, we urge you not to let anxiety over the fiscal cliff or sovereign debt problems in Europe distract you from what matters most. Turn off CNBC and close the Wall Street Journal for a few days. Use the opportunity to recharge your batteries. There’ll be plenty of time to watch the news later. To help you with this, we thought it would be nice to share a few positive things worth being thankful for.
Progress towards a fiscal compromise: The latest word is that the White House and Congress have committed to short negotiations, with the goal of achieving a fiscal cliff resolution before the New Year. This is welcome news and we hope we’ll begin to see business leaders opening their wallets and making big investments in hiring and growth soon.[i] Markets slid during the early part of last week, but rallied Friday on this news. [ii]
Resilient markets: Despite what we’ve been through in the past few years, U.S. markets are still performing well – the Dow is still up 3% for the year and 3.5% since last year, when economists worried that we might be facing a double-dip recession. With consumer sentiment running high and investors feeling renewed confidence in Congress, we may still see additional upside this year.[iii]
A recovering economy: Our economy has suffered some serious pain in the last few years, but is still chugging along. Currently, we have a housing market that is bouncing back vigorously, a decreasing unemployment rate, and recovering industrial output. Our economy still has a long way to go before it can be considered fully recovered, but trends are pointing to continued improvement next year if we can get past the fiscal cliff.[iv]
Looking ahead, despite the holiday-shortened trading week, markets could still see some action. Housing data will be released Monday, and Ben Bernanke is scheduled to speak Tuesday (analysts expect his remarks to address the economic recovery and tight consumer credit markets). The day after Thanksgiving, Black Friday will mark the start of the holiday shopping season and traders may have time to react to any early revenue announcements.[v] European analysts expect the next round of Eurozone aid to Greece to be announced this week, so we may see some movement in currency and European markets too.[vi]