Wealth Watch-Market Pullback

The markets had another up day Tuesday as the up trending market prompted investors to add equity exposure. The chart above shows that we are about to hit a 14-year triple top. We have been hearing some say that this may be the end to this nice rally we have been having. We are not in that camp. Yes, we could have a necessary period of consolidation. The markets are a bit overbought and a pullback can, and very likely will, happen. That would be normal and healthy. We have been advising readers to add to equity positions on any pullback for over a year now. We will continue to do so until this market tells us otherwise. But right now, it is telling us loud and clear that it is going higher. To those of you who think you have missed the move, I would say you should reconsider and start making good solid long term investments on any pullback. When we do break through the triple top, it could be the start of a very powerful bull market from a very strong base. Again, to be clear, we fully expect a pullback in the not too distant future, but this looks like the beginning of a multi-year bull market. Be prudent and diversify, but sitting on the sidelines may cost you a fortune.... Good luck to all. Global economic growth will continue to be sluggish during the coming year if the International Monetary Fund's latest forecast proves correct. The IMF's latest report projects a 3.4% global growth rate for 2013; that would be better than the 3.2% expected for 2012 but slightly lower than last October's forecast. The IMF also predicts a 2% growth rate in the United States, and sees Europe slipping back into a small contraction of 0.2%, though the report also said a European recovery could help push global growth to 4.1% in 2014. Sales of new homes fell to 7.3% in December, according to the Department of Commerce, but they were still 8.8% higher than the previous December. The median price of homes sold was up 1.3% for the month and 13.9% ahead of a year ago. The median home price was up 6.3% from a year ago--the biggest year-over-year increase in seven years--and the 4.4 months' worth of unsold homes was the lowest since the spring of 2005. Exxon Mobil reclaimed its status as the company with the world's largest capitalization when Apple capped off a months-long slide by plummeting below $450 a share after its Q4 earnings report disappointed analysts. As Timothy Geithner spent his last day as Treasury Secretary, President Obama nominated Mary Jo White to head the Securities and Exchange Commission. As a U.S. attorney, White prosecuted mobster John Gotti and terrorists responsible for the 1993 World Trade Center bombing. Obama also re-nominated Richard Cordray, who has been heading the Consumer Financial Protection Bureau on an interim basis since January 2012. The Bank of Japan increased its target level of inflation to 2%; the country has been battling deflation in recent years. The Japanese central bank also will maintain its key interest rate at near zero and extend its purchases of financial assets (similar to the Federal Reserve's quantitative easing program). Have a great week! Vance

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