Just as all the "window-dressing" (momentum traders/fund managers chasing the usual high-beta names like Apple, Chipotle, etc.) was kicking into full gear today, sellers came back into play killing some of the festivities.
Gold-mining plays like Newmont Mining ( NEM ) and Goldcorp ( GG ) had been getting in on the quarter-end frenzy as well, with gold prices making another assault above the $1800 level. Credit-card issuers MasterCard ( MA ) and Visa ( V ) were hitting 52-week highs, but soon backed off those levels. Goodrich ( GR ) was jumping higher as rumors continue to point to a takeover offer from United Technologies ( UTX ). One stock that was not participating in today's early spike was Xilinx ( XLNX ) following the semiconductor play lowering its profit outlook. The news did not appear to be having much of an effect in the semiconductor space, but sellers did exit some of the names in the sector by day's end. Commodity names saw the bulk of the late-day selling with stocks like Freeport McMoran ( FCX ), CF Industries ( CF ), and Cliffs Natural Resources ( CLF ) resuming the recent downtrend.
Siemens Makes a Withdrawal as the Fed Brings U.S. Taxpayer Dollars Abroad
You can file this one under "actions speak louder than words." The Financial Times reported that German conglomerate Siemens ( SI ) has pulled more than 500 million euros from a large French bank and transferred it to the European Central Bank. The company cited the future fiscal health of the unnamed bank, but also that it would be getting higher interest rates paid by the ECB (European Central Bank). I'm certainly not shocked by this news, but the message being sent by Siemens to bank investors and deposit holders isn't very encouraging.
Interestingly enough, this Siemens story comes on the heels of news out last week that the Federal Reserve has been making loans to European banks. Now the equity markets have been stable for the most part in September, but the Fed has added another layer of complexity to our own financial stability. If aid to Europe fails to deliver its intended outcome, we could see further volatility in the financial space.
As has been the case, we remain highly wary of financial stocks in the current economic environment. With little to offer in terms of dividend yield, the financial sector just isn't appealing for long-term investors.
Disappointing Trends in our Education System
According to the College Board, SAT reading scores for the high school class of 2011 were the lowest on record, and combined reading and math scores fell to their lowest point since 1995. Despite the results, college enrollment continues to increase.
And here's another startling statistic: the total amount of U.S. student loan debt has now surpassed the nation's total credit card debt. Yes, you read that right. It's safe to say the next big consumer debt crisis in America will focus on student loans. How this problem will affect college admissions, tuition costs, etc. remains to be seen.
This past weekend, I had a frank talk with my oldest daughter (who just started 10th grade) about the realities of life. Trying to balance getting great grades, participating in sports, and spending plenty of time with friends is a difficult task for today's young adults. I encouraged her to come up with a realistic time structure for what she can actually accomplish.
Parents face their own pressures, as well. Keeping the bills paid sometimes takes precedence over monitoring what your children will wind up doing with their lives. I'm a big believer in the ROI (return on investment) factor when it comes to figuring out the best route for your child, given his or her inherent strengths and weaknesses.
The stories of unemployed college graduates will only continue. I recently spoke to a friend whose son graduated in 2008 and had majored in Communication. After college, her son bounced around working various odd jobs before being forced to move back in with his parents. Now, he's set to go on an interview with a Reebok retail outlet store for what could turn into an eventual managerial position. Now you can argue that his degree will pave the path to managerial experience, but having been in retail myself early in life, I can tell you it is not necessarily about the degree one possesses, but the actual skillset that helps grow a businesses' bottom line. Personality can be just as important in certain cases to climb the ladder (even for someone to perhaps take a shot on their own in their own business). To make the point though, take some time to really dig in to what your child or grandchild is going to do with their life once high school life begins. Their path to success may or may not require a specific college degree and their initial choices may be well off the mark when it comes to developing a financially-fulfilling career.
Making money and having a good career can help alleviate the pressures that eventually come home to roost in real life. No one will guide your child more than you will. Don't leave it to guidance counselors or college admissions officers who are on the clock to process paperwork and move on to the next file (some, of course, are willing to go the extra mile, but they are few and far-between). If you can have your child speak to a professional in their particular field of interest, you may be able to narrow some choices down and clear away from uncertainty about his or her career aspirations.
This process will also teach your child key decision-making skills that will benefit them throughout their life.
Income, Income, Income
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Thanks for reading everybody. I'll see you tomorrow!
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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