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Wall Street Strategies has been providing independent stock market research since 1991 to individual, retail and institutional clients through a balanced approach to investing and trading. Charles Payne, our founder and chief analyst, is routinely sought after for his stock market, political,... More
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  • Happy New Year By: Charles Payne 1 comment
    Dec 31, 2009 10:34 AM

    I was slightly impressed with the market yesterday. There was no reason for stocks to rebound even with better than expected economic data (see Chicago PMI), but, a little spurt at the end became something akin to an exclamation point. Today's session probably doesn't mean much for next year but could, once again, say much about 2009. Even though I felt like a traveling preacher asking people to believe, I have to admit the strength seen in the market this year is more than I expected. Yes, stocks were oversold and pessimism was too high. The former is no longer the case but there is still enough of the latter to mean something to a contrarian like myself. I do worry about when the momentum stops, but we will not go into full bunker mode at the first 10% pullback. Still, there are still big question marks for 2010, including the possible removal of the punch bowl (aka stimulus).

    In addition to the fact that failure is a major part of success, and is embedded in the path to glory in this country, another reason government should stop handling taxpayer money is they do it so inefficiently. Not only has the government bailed out too-big-to-fail banks but more money was poured into GMAC while Freddie Mac and Fannie Mae got blank checks. It hasn't worked, all those people that whine about what would have happened if a few more banks bit the dust should consider what would have happened if the government used those trillions of dollars in a more direct manner to help Main Street rather than this convoluted approach that has sucked the nation dry. Plus, the government is just a sloppy fiduciary of money and spends it without concern to effectiveness.

    When you get money you haven't worked for it's really easy to blow it, particularly if you know more is coming. The latest case in point, yesterday Sandra Smith reported on the Fox Business Network how much it has cost taxpayers to backstop mortgage modification efforts. Each modified home has cost near $900,000 each! Yikes! We could have paid off the mortgages and saved an average of $700,000 on each.

    It was a good year in some ways. The stock market rallied against all odds, and many would say all commonsense. The people rose out of a long slumber to voice their opinions and in the process, have put politicians on their heels. But, the bad news is deafening and will define the year. Ten percent unemployment, plunging housing prices compounded with a never-ending stream of foreclosures. Sleight of hand by elected officials with government spending moving to new dizzying heights is also out there. We pray for the troops in Iraq and Afghanistan. And we enter the New Year afraid to hop on a plane after the Christmas Day terrorism attempt. The cautionary tale from that incident is that we can't be complacent, we can't let our guard down, and we can't be on the defensive in this fight...we must be on the offensive.

    In the end, we are here and we stand tall.

    At Wall Street Strategies, we thank all of our subscribers and pledge to work even harder next year to navigate this market and find profitable ideas through smart strategies. There will be no afternoon report today. Everyone have a great New Year.

    Economic Data

    Initial Jobless Claims

    More good progress on the jobs front was evidenced in the initial claims data released in the pre-market. The better than expected claims data fits nicely with the improvement seen in the jobs component of the Chicago PMI yesterday. Initial claims numbered 432,000 (consensus: 460,000), falling by 22,000 week to week. Continuing claims dipped below 5.0 million (4.98 million), which was also better than consensus, and the first time since February.

    Disclosure: None
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  • Tina Irene Williams
    , contributor
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    Excellent article. Thanks for writing it, Charles. I read all your writings referred by way of Twitter and I make it a point to catch you whenever you're on the FOX Cable News Channel. I caught your street discussion with Glenn Beck and was touched by all you shared about your struggles when you were a teen and young adult. You are a fine young man...yes, young compared to me. We were both raised in the greater NY area (I'm from Westchester County...born and raised in Mount Vernon many decades ago). Happy New Year, you are in my daily prayers, and may God abundantly bless to you and yours.
    31 Dec 2009, 11:39 AM Reply Like
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