Hopefully the stock market will consolidate gains for awhile, especially ahead of earnings season that won't be good and no guidance will be given, but I disagree with many who state that nothing has changed. I believe a lot has changed, much of it for the better.
Here is a short list:
Two of the most important financial institutions just reported results well ahead of expectations. We'll see what happens with the other financials and we know that we are not out of the woods, but after looking at WFC and GS, one must wonder what the heck all the nationalization talk was all about.
By most measures, mortgage rates have fallen to all-time lows. The implications of this are substantial on a prospective basis both for the real estate market and for consumer balance sheets and consumer spending.
Energy prices and other commodities have stabilized at lower levels. This is good for consumers (lower prices) and good as a "tell" that the world is not headed into depression.
Merger and acquisition activity has picked up, with financing available.
Republicans and moderate Democrats have provided much-needed pushback to the Administration's ambitious agenda. The terrible cap and trade is off the table for this year, and the dreadful card-check bill is dead. Obama has taken a much more amiable tone toward business - for now.
Getting out of this mess will take time, although maybe not nearly as much time as the permanent gloomsters are saying. We are making progress. Substantial progress, in my view.
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