The Third Rail Gets SlipperyThe above shows how different people can look at the same events and come to startlingly varied conclusions. Speaking of which, politics became the center of a heated debate on the RealMoney.com site this week. Jim Cramer got the ball rolling by declaring the market to be "sick from the top down," and citing "a gradual realization that Bush will be forced out in November and a new man will be president, a man who may not be better for the stock market but one who arguably may not be worse if simply because a gridlocked government is better than the drunken spending and the no-vision team we have in now." Cramer's comments prompted a strong rebuttal from James "Rev Shark" DePorre, to which in turn I responded. Not wishing to rehash the debate, I bring it up only to suggest that maybe the election in November isn't having as much effect on shares as some contend. The impact of corporate earnings, valuations and sentiment are arguably similarly overstated because, as the chart below suggests, what seems to be really moving the stock market (especially tech stocks) are crude prices. Crude climbed 3.5% this week to $41.30 late Friday, which maybe tells you all you need to know about what happened in the stock market. Finally, I'll be back on John Batchelor's ABC Radio Network show to discuss these and related issues Friday night/Saturday morning, around 9:05 p.m. PDT/12:05 a.m. EDT. Check the ABC Radio Web site for Webcast options.
|A Relationship Worth Watching |
Oil and the Nasdaq 100 are running in opposition.