Wall Street has done a fairly decent job the last 12-18 months
painting a picture of improving economic conditions. The constant
barrage of market experts breaking down various data points of
"better than consensus" can be quite the racket for participants
looking for facetime to promote their firm and outlook.
The jobless are in a huge struggle for extended unemployment
benefits that recently ran out, while the government plays politics
utilizing polls to determine how a decision to extend them will
play out in the November elections. Unfortunately, the bailout of
the biggest Wall Street players merely delays the inevitable tough
medicine the economy was supposed to get 18 months ago. Companies
have pulled back from new hires and Wells Fargo just cut nearly
4000 jobs last week, with possibly more to come when the Wachovia
deal gets fully absorbed.
With these particular examples of struggles we are seeing, the
climate for investing continues to be one that requires a real
focus and insight that we hope to continue to bring. One thing we
have learned about companies, economists and politicians over the
course of an investing lifetime, and that is watch what they do and
not what they say.
Looking at today's market, we are coming off a week where the
markets delivered a nice gain, but once again continued to
underwhelm us with the volume totals. We'd like to see stronger
volume conviction on the upside days to give us a better feeling
that things could be turning in the economy, as well as the
corporate profits' picture. Despite our extremely cautious take on
the current economic situation, we have found several stocks we
like, so be sure to check out our Best Dividend Stocks list.
Wall Street analyst downgrades today pushed names like Aetna (
AET
) and Northrop Grumman (
NOC
) lower. Aon Corp's (
AON
) shares pulled back on news of the company's acquisition offer for
Hewitt Associates (
HEW
). Elsewhere, commodity-related shares pulled back with U.S. Steel
(
X
) , Freeport McMoran (
FCX
) and Cliffs Natural Resources (
CLF
) in the red. Qualcomm (
QCOM
) moved highe following an upgrade by Goldman Sachs (
GS
) . The market had a slight gain, but we actually had less volume
on the NYSE than we had on Friday, which in the summer is usually
lower than usual.
Be sure to visit our complete recommended list of the
Best Dividend Stocks
, as well as a detailed explanation of
our ratings system here
.