Five years ago almost to the very day, the S&P hit it’s bottom. The market had gone into free fall for months and the index touched 676.53. From that point, the S&P has risen more than 177% and recovered all those losses and even returned a small-annualized profit.

This bull market we have been in for a good portion of that time has been nothing short of amazing. Lifting every sector and when historians look back, their explanations will be as simple as they are now. There has been no better, safer place to put your money than in US equities.

While equities will always carry risk, in 2009, they clearly had the least amount of risk besides US treasuries and in the environment that the Fed created, treasuries might not have had much risk but they certainly had zero reward.

Common sense at the time would have told you, we weren’t going into a depression and stocks were cheap. Common sense prevailed and investors slowly and steadily have put their money back to work and thankfully, their nest eggs are whole.

Most people will look back and say that they should have done this or should have done that and they would be rich today. We tend to not look back on those terms and just say that investing at times, is not for the faint of heart and you have to pay attention to the signals.

At this point in time, the signals we see are pretty clear. The market is getting very close to being fairly priced. We think that there still is some upside potential but it isn’t huge and if you have recovered your assets and gained some, it might be a good time to take some of that money off of the table for a little bit.

While we still are bullish in the long term, we presently are neutral and with a bias towards short-term bearishness.
Only because of the micro picture (stocks fairly priced) and nothing else.
The geopolitical situations that are brewing around the world do worry us a little. The potential economic fallout from the situation in The Crimea may seem to be limited but we view it a little more cautiously.

While the US is making headway in its three year recovery, the European Union is not that far along and to disrupt its delicate balance with sanctions against a major trading partner like Russia could imperil their recovery. The Europeans are very aware of the fact that the US may stand to gain from some of those sanctions and conversely, the US won’t suffer much from the implementation. That, we believe, will be the key. If the EU is willing to go forward with the US plan, the fragile recovery in Europe may be shaken badly.

While some pundits may say that this is a week to take a breath and really look into the investments that you have and make some first quarter adjustments because the data will be sparse. We don’t agree.

Market moving events will be in short supply, however, there will be a lot of different items to look at and along with what has already come out in the last two weeks, a very good picture of the economy will emerge Retails sales, consumer sentiment and JOLTS being the three key ones. The JOLTS report on Tuesday is not widely followed but we like it because it gives an honest picture of the job market, you just have to dig a little deeper in this one.