Evidential matter of the consumer is systematically being reported. Why would any be surprised by AXP's report? I'm no longer surprised by this surprise--a point of evolution in my dispelling some of my perplexions! But the market is a half-assed discounter of information--but when it gets some empiricism, it acts quickly.
I was reading Selden's Psychology of the Stock Market--yes, again. I continue to be struck by its relevancy. In one section he was discussing the general money conditions--availability of of money--and how when those conditions deteriorate, so does the market.
A source of frustration to me, is my lack of clear-sightedness regarding the effect of all of this 'stuff'. I rightly believed that the pundits who continually chirped incessantly about the the deluge of money that would flow from the Fed were misguided. It's a situation where one takes a historical precedent (increase money spigots = increase in the stock market) and MISapplies it to the current situation. Simply put: the failure to understand the difference between solvency v. liquidity.
The Fed's actions so far only help re-solve the banks so they can meet current capitalization requirements for loans they've already made. That's filling a hole--not spilling over to flood the waterways of commerce to float everyone's boat.
I'm beginning to rethink my thesis on oil services. I bought a little DIG to hedge my DUG calls. What we may witness is the market accepting a higher earnings multiple on these historically low p/e's: a sector p/e multiple shift if you will. It's something to keep in mind--particularly when you look at the technology and retail and the rather poor prospects of banking.
I'm not sure what is going on in utilities. I've a double short position (very small), but the last couple of day's, utilities have been perking up. Though they were oversold earlier.
So to keep in mind Selden's thought on the state of the money supply, personally, I don't see that picking up markedly. I think that conditions deteriorate before they get better--we'll see more defaults; more unemployment. And if things are going to get better in the latter part of year, I want someone to name some names--what sector is going to do that? If you know, chirp it up!