Wednesday, October 01, 2014 10:25pm
North Adams, MA now: 57 °   
Send news, tips, press releases and questions to info@iBerkshires.com
The Berkshires online guide to events, news and Berkshire County community information.
SIGN IN | REGISTER NOW   

Home About Archives RSS Feed
@theMarket: A Week to Forget
By: Bill Schmick On: 11:15AM / Saturday March 19, 2011
Important
0
Interesting
0
Funny
0
Awesome
0
Infuriating
0
Ridiculous
0

In last week's market column, I warned readers of an impending decline of as much as 5 percent in the stock markets. I realize that not everyone receives both my columns each week. The important thing to know is that 4 percent of that drop has occurred but we may still have a re-test of the lows. 

Over the last few days I have been making a lot of what I call "hand holding" calls. These conversations are meant to summarize the events in both Japan and the Middle East, explain how we are dealing with this crisis, and answer any questions people may have. I soon discovered that my clients (and people in general) have been subjected to a lot of misconceptions, misinformation and still have many unanswered questions surrounding these crises. So let's try to set the record straight.

"What's going to happen in the Middle East?" asked a local business owner from Pittsfield.

By now you know that the United Nations declared a no-fly zone over Libya on Friday. In response, Libya's foreign minister quickly declared a cease fire, but as of this writing, battles still rage within the country. On the news, both oil and precious metals declined from overnight highs. All three of those commodities have gyrated wildly all week in response to global events.

At the crux of this controversy, investors fear that while Libya is a small player in the oil markets, unrest in the region, whether in Gaddafi land, Bahrain or elsewhere, could spread to Saudi Arabia. Unrest within the Kingdom would jeopardize a much larger piece of the world's energy pie and could cripple global economic growth.

The ruler of Saudi Arabia, King Abdullah, has decided to short circuit any political unrest in his kingdom by buying off the people who count. Friday he announced a multibillion dollar boost in welfare benefits, bonuses for public-sector workers (including the army) and a massive program of new housing. This follows last month's $37 billion giveaway. Some of the money will also be spent on hiring, ahem, 60,000 new "security guards" at the interior ministry just in case this bribe does not appease all of the populace.

My belief is that tensions in the Middle East may continue, but their power to impact world equity markets is diminishing and as they do, the price of oil will slowly sink back to my target of $80-$90 a barrel, which seems a reasonable price for oil, given world economic growth.

Japan's crisis around the Fukushima nuclear plant, on the other hand, is still a wild card. No one knows what will happen in the days ahead. I maintain that, if the worst should occur, it will not have a substantial impact on the United States. The uncertainty, however, will keep world markets volatile for a bit longer.

If I measure this pullback from top to bottom, we have had a 7.01 percent decline. Over the last few days we have been experiencing a relief rally that has reclaimed about 3 percent of that fall. I am not certain that we have seen the lows yet on the S&P 500 Index. We could still test the 1,225-1,235 level if there were to be a nuclear meltdown at Fukushima or an air war with Libyan forces.

None of that changes my strategy and hopefully yours. This is a pull back to be bought. Don't try to catch the very bottom, simply add to your positions on down days. You should have been doing just that this week. I know I have.

Bill Schmick is an independent investor with Berkshire Money Management. (See "About" for more information.) None of the information presented in any of these articles is intended to be and should not be construed as an endorsement of BMM or a solicitation to become a client of BMM. The reader should not assume that any strategies, or specific investments discussed are employed, bought, sold or held by BMM. Direct your inquiries to Bill at 1-888-232-6072 (toll free) or e-mail him at wschmick@fairpoint.net. Visit www.afewdollarsmore.com for more of Bill's insights.



0 Comments
Tags: oil, energy, Middle East, Japan, nuclear      
News Headlines
Cheshire Asks for Verizon Pole Cleanup, Hears Park Update
North Adams Vigil Celebrates Addiction Recovery, Mourns Loss
Longtime MCLA Staffer Degen Retiring
Does Your Plan Need A Makeover?
Girl Scouts to Host 'Geek Is Glam' STEM Expo
Williamstown Elementary Clothing Sale Benefits Classrooms
North Adams Happenings: Oct. 1-7
Edward Jones Announces New Financial Adviser for Pittsfield
Bank Employees Raise $13,000 for Alzheimer’s Association
Lisa Cunningham Joins True North Financial
Bill Schmick is registered as an investment advisor representative and portfolio manager with Berkshire Money Management (BMM), managing over $200 million for investors in the Berkshires. Bill’s forecasts and opinions are purely his own and do not necessarily represent the views of BMM. None of his commentary is or should be considered investment advice. Anyone seeking individualized investment advice should contact a qualified investment adviser. None of the information presented in this article is intended to be and should not be construed as an endorsement of BMM or a solicitation to become a client of BMM. The reader should not assume that any strategies, or specific investments discussed are employed, bought, sold or held by BMM. Direct your inquiries to Bill at 1-888-232-6072 (toll free) or email him at Bill@afewdollarsmore.com Visit www.afewdollarsmore.com for more of Bill’s insights.

 

 

 



Categories:
@theMarket (145)
Independent Investor (197)
Archives:
September 2014 (5)
August 2014 (7)
July 2014 (2)
June 2014 (6)
May 2014 (9)
April 2014 (8)
March 2014 (6)
February 2014 (6)
January 2014 (7)
December 2013 (8)
November 2013 (7)
October 2013 (6)
Tags:
Stocks Stimulus Fiscal Cliff Crisis Currency Energy Markets Euro Banks Debt Rally Interest Rates Metals Jobs Greece Bailout Deficit Stock Market Taxes Commodities Retirement Election Japan Federal Reserve Selloff Oil Pullback Recession Europe Fed Debt Ceiling Housing Europe Congress Economy
Popular Entries:
The Independent Investor: Understanding the Foreclosure Scandal
The Independent Investor: Don't Fight the Fed
The Independent Investor: Does Cash Mean Currencies?
@theMarket: QE II Supports the Markets
@theMarket: Markets Are Going Higher
The Independent Investor: General Motors — Back to the Future
The Independent Investor: How Will Wall Street II Play on Main Street?
The Independent Investor: Will the Municipal Bond Massacre Continue?
@theMarket: Economy Sputters, Stocks Stutter
The Independent Investor: Why Are Interest Rates Rising?
Recent Entries:
@theMarket: Wash, Rinse and Repeat
The Independent Investor: Is Wall Street Responsible for Climate Change?
@theMarket: Waiting on the Fed
The Independent Investor: The United States of Scotland?
The Independent Investor: Europe Follows the U.S. lead
@theMarket: What's Up With Bonds?
The Independent Investor: Baby Boomers and Retirement
@theMarket: Labor on Their Mind
The Independent Investor: Financing ISIS
@theMarket: Geopolitical Risk Trumps Economic Growth


View All
Soccer:Taconic vs Lee
Lee won 6-2 over Taconic Tuesday afternoon. Submitting...
Soccer: Lenox vs Mount...
Dan Flynn scored both his goals after half-time to lead...
Girls Soccer: Wahconah vs...
Monday afternoon girls soccer game between Wahconah and...
Golf: Drury vs Pittsfield
Nick Boulger carded a 40 to lead the Drury High School golf...
Bike Night 2014
Motorcycles packed into the Visitor Center parking lot...
Girls Soccer: Pittsfield vs...
Trinity Cookis tallied three of Pittsfield’s seven goals...
Soccer: PHS vs Taconic
Pittsfield boys, top Taconic 5-0
Football: Smith Voc vs McCann...
McCann over Smith Voc. 53-0.
Soccer: St. Joe's vs Taconic
St. Joe 1, Taconic 1: 1st half: Tac - Ryan Abel (Colin...
McCann Tech Golf
The McCann Tech golf team dropped a 19-5 decision to...
Girls Soccer: Hoosac vs Mt....
Rand made two of her six saves in the last six minutes, and...
Berkshire Works Career Fair...
The annual Berkshire Works Career Fair connected hundreds...
Soccer: Mount Everett vs...
Bradley Lupiani scored twice to lead the Mount Everett boys...
Cross Country at Wahconah
Boys:Wahconah beat Hoosac Valley 28-31; Lenox beat Hoosac...
Soccer: Commerce vs McCann
McCann Tech's Fuller Closing in on Hundredth Point. Nico...
UCP Annual Meeting 2014
United Cerebral Palsy of Berkshire County dedicated its...
Soccer:Taconic vs Lee
Lee won 6-2 over Taconic Tuesday afternoon. Submitting...
Soccer: Lenox vs Mount...
Dan Flynn scored both his goals after half-time to lead...
Girls Soccer: Wahconah vs...
Monday afternoon girls soccer game between Wahconah and...
Golf: Drury vs Pittsfield
Nick Boulger carded a 40 to lead the Drury High School golf...
Bike Night 2014
Motorcycles packed into the Visitor Center parking lot...
| Home | A & E | Business | Community News | Dining | Real Estate | Schools | Sports & Outdoors | Berkshires Weather | Weddings
Advertise | Recommend This Page | Help Contact Us | Privacy Policy| User Agreement
iBerkshires.com is owned and operated by: Boxcar Media 102 Main Street, North Adams, MA 01247 -- T. 413-663-3384 F.413-664-4251
© 2000 Boxcar Media LLC - All rights reserved