Fox26:  End of Debt Ceiling Date Suggest Higher Markets – Pt. 2

Fox26: End of Debt Ceiling Date Suggest Higher Markets – Pt. 2


OPERATIONS ABOARD THE INTERNATIONAL SPACE STATION WERE AT WORK.>>THE END OF THE SHUTDOWN ALONG WITH CONGRESS RAISING THE DEBT CEILING SHOULD MAKE WALL STREET HAPPY WHEN THE BELL RINGS 30 MINUTES FROM NOW. LANCE ROBERTS, WHO IS ON THE RADIO AT KSEV IS TAKING TIME TO BE WITH US NOW. LANCE, THE DEAL REACHE BY CONGRESS AND SIGNED BY THE PRESIDENT IS GOOD FOR OUR RETIREMENT ACCOUNTS, RIGHT?>>ABSOLUTELY. YOU KNOW, THE ISSUE NOW, THOUGH, IS THAT N NOW WE’VE MOVED PAST E DEBT CEILING. WE’VE GOT TO FOCUS ON WHAT’S GOING ON WITH CORPORATE EARNINGS AS WELL AS THE UNDERLYING ECONOMY ITSELF. EARNINGS OVER THE LAST FEW DAYS, IBM, GOLDMAN SACHS, HAVE NOT BEEN VERY GOOD. SO THAT’S GOING TO POTENTIALLY START TO BE AN ISSUE GOING FORWARD. IF WE DON’T START TO SEE EARNINGS PICK UP AND SEE PICKUP IN THE ECONOMY, THAT COULD WEIGH ON THE MARKETS LATER THIS YEAR. WITH THE FEDERAL RESERVE PUTTING LOTS OF STIMULUS INTO THE MARKETS, THE BIAS IS TO THE UPSIDE. WITH THIS HURDLE OF THE DEBT CEILING BEHIND US, IT CLEARS THE WAY FOR THE MARKETS.>>WHAT DO YOU EXPECT THE OPENING BELL — AT THE OPENING BELL TODAY?>>BASICALLY, I THINK THE MOVE YESTERDAY THAT WE SAW IN THE MARKETS, THE MOVE OVER THE LAST FEW DAYS IN THE MARKET, WHICH HAVE BEEN TO THE UPSIDE AND PUSHING US UP TO ALL TIME HIGHS FOR THE MARKET, HAS BEEN IN ANTICIPATION OF GETTING THE DEBT CEILING DONE. IT MAY BE IN THE SHORT TERM OF JUST A SELL THE NEWS, A PULLBACK IN THE MARKETS WOULD NOT BE SURPRISING OR BAD. IT’S HEALTHY, ALLOW THE MARKETS TO RESET A LITTLE BIT. BUT I DON’T SEE ANYTHING ON THE NEAR HORIZON THAT SHOULD WORRY THE MARKETS.>>WHAT ABOUT THE NATION’S RANKING WHEN IT COMES TO RATING THE ECONOMY? FITCH SAID WE’RE GOING TO DROP YOU FROM AAA LOWER. I THINK YOU SAID CHINA EARLIER HAD ALREADY DONE A DROP IN OUR RATING. WHAT DOES THIS ALL MEAN TO US NOW?>>IT DOESN’T MEAN A LOT. FITCH IS A FRENCH COMPANY, SO ENOUGH SAID ABOUT THAT. THE ISSUE IS THAT OUR DEBT RATING HAS A LOT TO DO WITH, YOU KNOW, WHAT WE PAY IN TERMS OF INTEREST WHEN WE BORROW MONEY. SO THE WORSE OUR CREDIT RATING, THE HIHEGR IT COSTS US TO BORROW MONEY. IN OTHER WORDS, THE INTEREST RATE WE HAVE TO PAY IS HIGHER. THESE RATING AGENCIES, S & P LOWERED OUR RATING. FITCH DID YESTERDAY. IT DOESN’T MEAN MUCH TO OUR BORROWING COST. IN THE WORLD OF HOW WE WORK, EVERYBODY WANTS TO KEEP THEIR MONEY IN AMERICA BECAUSE IT’S THE SAFEST COUNTRY ON THE ENTIRE PLANET.>>>>ALL RIGHT. THANK YOU, FINANCIAL ANALYST

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