Inflation is here even though its being underreported intentionally by the powers that be. The administration is understating inflation on purpose to keep bond yields tame. If bond yields rise on the benchmark 10 year, the housing and subprime debacle will have greater affects then they do now.
If you go to the pump and pay more, its inflation. Grain prices are at highs, with oil conversion increasing speculative tendencies.
In terms of goods and services higher transport costs, means higher end product costs. Otherwise the producers end up eating the difference, which doesnt paint a good picture for energy intensive production outlays.
Utilities are still a great sector, consumer staples is another great sector. But only a few good tech companies should be in the portfolios. Just think of what tech products or services you use day to day and invest only in those. They will outperform most everything else, use Peter Lynch's model of portfolio allocation or picking great companies by day to day living needs.
Stagflation will be the mainstay, you can smell it worldwide, the boom is in its final stages and world wide stagnant growth is the next macro scenario that is of a higher risk of happening. With liquidity being tightened, global rates higher and higher.
Usually equity markets run stops to the upside, before a death spiral. On thursday they knew the main retail sales number Friday would come in poor. So they used thursday to run stops. Tax payer dollars in collaboration with wallstreet and some trading houses is being used to protect the sentiment of the american public by keeping equity sentiment uplifted. Its a great big game and once you realize whos interests are being protected you just roll with it and feed off them.
The main powers that control this country are:
1) oil companies
2) defense companies
3) wallstreet
4) arab/GOP oil link
They are interlocked symbiotic entities, they have more money then most other entities, and can control any large market.
