Why 13 May Not be an Unlucky Number
There is so much promise and optimism in the new year we almost forget there is an unlucky #13 inside of it. How many of you are superstitious? Ever find yourself being careful and worried on a 'Friday the 13th'? Well, I don't think this year will offer too much to worry about as it relates to markets (save for the panic caused by a surprise event). With the fiscal cliff now pushed aside (for now) the economy is set to move a higher level, and with less to worry about that would be a good thing.
Why does it seem that I am encouraged about the year ahead? It's not a guess, but the data are reflecting the optimism. Companies here in the US are showing their muscle and gaining ground, staying 'lean and mean' and in an ideal situation for growth. Sentiment can move the market tide in and out but what really matters is productivity, manufacturing and sales. In the third quarter the US upped their exports and cut the deficit by 10%. That's not too much but a good start. Productivity levels have been steady and look ready to rise while industrial production is still trending higher. Some of the better sector performers include housing, banking, commodities, industrials, airlines and aerospace/defense.
China has come through lately with some solid economic numbers. Purchasing managers are active and picking up the pace for the country's recently announced growth initiatives. Some are expecting China to grow in the mid 8% range in 2013. Meanwhile, Japan has finally woken up and decided to stimulate their economy with an aggressive yen strategy, something not seen over the past 20 years. Europe is still showing signs they have bottomed which is good news as those countries need time to work through their debt crisis. Once aside the world's largest economy by region may even contribute some growth in the back half of the year.
There is a saying: 'As January goes, so goes the rest of the year.' If the month gets off to a fast start and the political wranglings yet to be faced are taken care of amicably (boy, is that an ambitious statement!) then we could see a good year. This was also said recently by Chairman Bernanke and President Obama, who told you in summer 2009, 'it is not a bad time buy stocks'.