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Bulls & Bears
This past week's Bulls & Bears: Gary B. Smith, Exemplar Capital; Matt McCall, Penn Financial Group; Damon Vickers, DamonVickers.com; Pat Dorsey, Morningstar.com, and Jordan Goodman, MoneyAnswers.com.
Dow Jumps 258-Pts First Trading Day of '09; Proof Bull Is Back?
Matt McCall, Penn Financial Group: The bulls are charging in. I think we're setting up for a very big rally in 2009. The first trading week of every New Year is indicative of what's going to happen for the rest of the year.
Jordan Goodman, MoneyAnswers.com: Everyone is feeling optimistic, except when these stimulus programs come in and end up not working. We're going to have a combination of inflation from all the money being printed, and deflation forces helping to keep the market down.
Gary B. Smith, Exemplar Capital: Everyone is trying to gauge sentiment. Will it be another lousy year, or a good year? They are using this week to try and predict that the market will be good this year. Unless the consumer begins to engage again in '09, at best the market will move sideways. There is something broken with the consumer right now.
Pat Dorsey, Morningstar.com: Everything is psychological right now. The amount of money people have isn't the issue; it's whether they want to spend it. Until the consumer comes back and is confident in spending again, there will not be a sustained rally.
Damon Vickers, DamonVickers.com: The consumer is the driving force of the economy, and they're broken and busted right now. A bull market will bring back the types of jobs we need, but there needs to be some kind of new technology development to help drive that.
More Bankrupt Retailers In '09 Could Be "Good" for Economy
Gary B. Smith: I feel badly for any company that goes bankrupt, but it shows that capitalism works. It rewards companies with good business models like Amazon, and punishes the ones that don't. These bankruptcies will help out the consumer in the long run.
Jordan Goodman: The retail industry can't go down—it's a huge portion of the economy. We have to support retailers
Matt McCall: Bankruptcy paves the way for new innovation, better pricing and better products.
Pat Dorsey: The employees losing their jobs in retail will only worsen the economy. But long term, these badly run companies have to be allowed to go bankrupt.
Will We See $3 Gas Is Hamas Missiles Hit Israeli Nuke Plant?
Damon Vickers: If they hit a nuke plant, gas will go through the roof, and stocks will implode, meanwhile they'll be singing and dancing in the streets of Iran and the Middle East.
Matt McCall: Gas prices will not explode upwards unless the economy completely takes off.
Jordan Goodman: We've had oil go from $35 to $46 in a week. Oil spikes if transportation routes or areas of supply get ruptured.
Gary B. Smith: Oil is in a reverse bubble right now. I think it's bound to go back up, it just needs the economy to rally.