July 28, 2011 Uncertainty
The financial markets reaction to the continuing budget dispute seems low-key, so far. At least in the sense that asset pricing remains quite stable. Whereas the Congress intent is to generate significant shifts in how much the government pays for retirement and health care.
The only significant market difference between now and before, is the pattern of daily closes. Todays configuration of closes the DJIA down for the fifth consecutive session, the S&P500 posting its fourth decline in a row, while the NASDAQ moved up .05 percent after three straight losses is only the third such alignment in our 60 plus years data base. Moreover, the earlier two happened years ago, in 1997 and 1998.
Such lopsided history prevents reliable projections of future prices. Indeed, it blocks the ability to rely on, or to use, past patterns to evaluate current decisions.
DJIA -.51 percent
NASDAQ .05 percent
S&P500 .32 percent