Welcome to the end of the week and another edition of Happy Hour! Just sit back, relax, and enjoy your end of the week roundup of all things interesting in the land of money.
Sell Off
Yesterday was the biggest sell off this year. If you were surprised by it, know that it was going to happen eventually. A market up 16% over the first five months this year is impressive, expecting more is just being greedy. By the way, after yesterday your S&P 500 index fund is still up 9% despite the fall from the May highs.
My basic belief is this – Bernanke just orchestrated a sell off to prevent an equity bubble. It worked. In effect, stock prices lost the QE premium that investors have paid. This should push stocks to trade on fundamentals going forward.
By leaving the QE taper window wide open, it leaves a huge amount of uncertainty on the table. That should be enough to prevent any QE premium from returning. Unless, of course, the Fed reverses course. Which could happen I guess.
All indications from the Fed on Wednesday pointed to an improving economy. One that could soon need less QE and eventually none. That’s good news. Unfortunately, the side effect was this unwind from the May highs. And sadly, Bernanke manufactured the perfect “sell in May and go away” scenario.
4 Minute Workout
Finally there’s a reason to workout. Some Norwegian scientists revealed research showing that 4 minutes of strenuous activity three times a week is all you need to increase metabolic and cardiovascular health. Seriously, 4 minutes three times a week. They’re testing shorter times but it doesn’t seem to have the same impact. Imagine a 1 minute workout or breaking the 60 second barrier. Just think of all you could do with an extra 3 minutes.
There is one downside. You won’t lose weight with this program. But you will improve your blood pressure, blood sugar control, and oxygen intake. Unfortunately, weight loss still requires more time.
Last Call
- Four Charts to Track Timing for QE3 Tapering – the best site to track the taper.
- Missed the Big Market Rally? Here’s What to Do Now – it still fits even after the sell off.
- Your Last Remaining Edge on Wall Street – your odds of success increase the longer you stay invested.
- Five Steps for Gaining Control of Your Investments and Avoiding Mistakes – more great advice.
- Global Sell-Off Shows Fed Reach Beyond the U.S. – if you’re interested, how the rest of the world reacted.
