I am going to try and update my blog with more of my thoughts on the market and events that impact the market as they happen. I’ll do my best to keep it consistent and to the point so here it goes.
Yesterday the market moved lower due to Standard and Poors downgrading the credit rating and the outlook for the US. I think this was no-brainer a well needed wake-up-call for Congress and the President to grow up and adhere to a budget that puts our country back on track towards prosperity. The market move was a knee-jerk reaction to news that caught some by surprise.
There is little doubt that if we continue on our current path the US finances will be a total wreck in the next few years and we will probably have a bigger hole than we can shovel out of. Hopefully, we can begin to fix it by reducing spending and possibly raising taxes (but only if there is significant spending cuts).
After being down more the 2% the major indexes bouced back to a loss on the day of 1%. As I write today we have gained back another 1/3 or so of those losses. All-in-all I think the report was a non issue but a warning that if we do not fix things and change the spending attitute in Washington the markets will punish as all. Let’s hope they get the message.