My Guru says
that we are in the middle of a text book midyear off-presidential
election market correction.
There have been 15
buying opportunities below S&P 1250
In the absence of any
further market weakness, dollar cost average into the market.
He expects to see
substantial additional gains which should carry the
market to new recovery
highs in the mid 1300's for the S&P.
GDP in a range of 2.5% - 3.5% going forward.
The first quarter had an annualized growth rate of 5.6% - post Katrina
first quarter had an annualized growth rate of 2.9% - consumer spending pressured by high
Expects the fed to hold short term interest rates at 5.25%
Further economic weakness may cause the fed to reduce rates.
for avoiding any further short term rate hikes:
Economic slowdown in the second quarter to only 2.9%
Sharp declines in new and existing home sales with declining
YOY price trends adjusted for inflation.
Pain at the pump, curtailing other consumer spending.
Inflation rates of 2.5 - 3 % despite the fact that interest
rates have risen over 20%.
Expects bond investors to earn their coupon in a
relatively benign bond market.
The contrary indicator, the 60-Day Put/Call ratio is at extraordinarily
These high readings should contain the stock market bottom at levels we
have already seen this year.
has no reason to exclude gains beyond S&P 1350 - 1400 in late
2007, it would be premature
to speculate out that far.
Remain fully invested in the market, buying on weakness
below S&P 1250.
Expects to see gains within S&P 1350-1400
in the last quarter 2006 and mid 2007.
portfolio changes were called for.
My Guru is still a happy camper