The year is coming to a close and we can only look back and say, “We told you so”. And we did. We said the market would break through its inflation adjusted highs (it did). We said that the economy would build momentum (it did). We said that the Fed would start tapering in September (it didn’t). Ok, so we weren’t perfect but no one ever is and we feel pretty good right now about our prognostications. With that in mind, we will put together an end of year look forward and lets see if we can keep the love going.

What part of this bull market can we talk bad about? Right now, the only thing that scares us is where some of the newly minted companies are trading. These companies with great ideas and not much else have shot up right out of the gate and that scares us.

We don’t think there will be any sort of bubble bursting, just a few pops and people will be stung but this is not the late 90’s folks. There are enough legitimate tech companies to keep the tech sector afloat should the IPO market contracts.

It could cause some minor problems but with so many positive places to put money, it won’t overheat.

The Dow has hit new highs for pretty much a quarter of the year and stocks still are not over-priced. We do believe many sectors are fairly priced and we probably will see some churning in the beginning of the year as money managers look to better utilize their gains.

As far as where we may be going, we think we will still be in a bull market throughout the first quarter and this should be a pretty good earnings season.

The fact that the retail investor is getting more involved would give us pause but it’s more about corporate earnings and less about the timing of money moving into the market.

Fear not, we will continue to chug higher with some minor setbacks along the way.

Since this is the last week of the year, the first week of the New Year, we have a light calendar and we don’t see anything unusually or market moving.

Pending Home Sales should come in lighter than expected and PMI on Thursday might surprise but everything is secondary to how well we did this year.

Hope you enjoyed this years notes and we certainly hope you read the year-end article.