Tuesday, June 14th, 2016

Obama’s stimulus package


Market has been watching carefully eyeing Obama’s Economic package being hustled in the Halls of Congress. There is one thing than another and another and the process seems to go on for ever. Its a huge bill worth about 850 billion in seed money that will be needed to jump start our economy after Dubya crashed it into a ditch. Where we are at, its going to take a miracle to get back to where we were in October 2007. 

Whats more concerning that now the consumers have stopped spending and shut their wallets tight. It will be a long time before Obama and his administration can deliver enough confidence back to people and revive the economy. Consumer spending is 67% of GDP and if that takes a tumble the Temple is pulled down on our heads.

After horrific declines, the stock market has been consolidating since October of 2008 and moving sideways. Its up 100 points one day and down 150 another and its not trending in any direction. Bottom line its an ideal market for Option sellers and Covered call writers and a total dud for day traders who make their living depending on directional moves. The market is in a wait and see mode, and sooner or later some kind of move will emerge, most likely to the upside as there is a floor placed on the downside for the time being.

We have closed our double calendar GOOG trade  for a small profit and still holding on to other trades, making money via time decay and using strategies to benefit from sideways movements. This is however not going to last for many more weeks, because all the indexes have shown a tendency to move up and not down even after worst of the news.

Last weeks Friday’s unemployment report rocketed  Jobless rate to 7.2 % and 598,000 Jobs were lost. These numbers even though very dismal failed to curb a market rally to the upside on Friday. Major stocks and Technology sector moved nicely getting 2-17 moves in AAPL, GOOG, RIMM. They all gained ground and are sitting above 50 day moving averages. Unless the shorts come and sell it off taking profits there is a possibility of a higher move to the right hand side of the charts which is started to build.

That move can come if Obama’s stimulus package is passed. This will give some vigor and confidence to the traders and and retail investors and the way major stocks are so cheap it will turn into a buying frenzy. We just have to see how it plays out if that package is passed this week. IF you have not subscribed please do so, as these slots are getting filled due to renewed interest in the stock and options investing please click on the link here .

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  1. […] all these efforts being made along with the Obama Stimulus package for 787 billion passed by the Congress, and we have seen 8 days consecutive market gains in a very […]

  2. […] a recovery and with all the resources thrown at the recession by current Obama Administration and Obama’s stimulus package and other reforms, it may just work and the market will take a […]



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