I say 8,700. What is your guess? The rising dollar amid low borrowing rates and steep drops in commodity prices means U.S. purchasing power is significantly improving. Despite all the talk of a debt-deflation crisis, increased buying power will be the self-corrective that limits damage to the economy, and thus to stock prices.
Six More Questions for Week No. 21 ...
Which Stocks To Buy on Rebound?
At the right price, you can't go wrong with cash-rich tech companies. Microsoft has enough money to survive a biblical flood, and its P/E is 13.
Will M&A Boom During the Second Half?
I think so. Cheaper stock prices will mean cash is relatively more valuable. Major tech companies--HP, IBM, Cisco, Microsoft--are absolutely flush with cash.
Is The Economy Slowing Down?
A month ago the economic consensus hinted at 3.2% growth for back half 2010. Seems too bullish now. Count on 2%. The probability of a double-dip recession is rising, but is still less than 50%.
Will Dems Blame Bush for Slowing Economy--Will It Work?
They'll try. Will it work? No.
Can We Sex Up Innovation?
Without fresh innovation--real innovation, not just more dippy social networks and piddly improvements on handhelds--the debt-laden American economy will slouch toward Europe. The solution? More inspirations like this.
Does It Matter If Lance Doped?
Last week I asked whether the Floyd Landis accusations would harm Lance Armstrong's brand. This is really a two-part question. Did Lance dope? If so, will that fact damage his reputation? When you talk to biking insiders off the record--as I did at the Tour of California this weekend--most say Lance and everyone else competing at the highest levels of cycling in grueling multistage races used EPO or blood doping (or some combination). I can't verify this as fact, and Lance himself denies it, but for the sake of argument, let's assume it is true. Would such a revelation hurt Lance's brand? It might not, because: One, if every top pro is using just below the threshold of detection, then the playing field is level and the riders with the most talent and dedication will still win. Two, Lance uniquely might get a pass from the public, at least in America, because of his heroic cancer recovery and his subsequent tireless work on behalf of cancer victims. If Lance Armstrong were a stock, I wouldn't short him yet.
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