You don't bet the farm but you need to be putting some money in as you find stocks that look attractive.
Alfred Kugel
Earnings are coming in 'in line' with expectations. We should still be up 15 percent year-over-year and that's better than we did in the first half.
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This was a big psychological negative and I think it was one of those things that triggered off the decline in tech stocks last summer. So the removal of the threat of breakup is a positive psychological thing.
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You really have a two-tier market with tech stocks going down and everything else going up. Part of this is because valuations in technology stocks got overdone this year and, at the same time, the Dow hadn't performed and now they look cheap.
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They're now looking at a situation where their shareholders are going to see the fund is down for the year but they're going to have to pay taxes on large gains. The managers are selling tech stocks that they might have bought at higher prices to realize losses and offset the gains.
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At the moment there are no concerns on the immediate horizon.
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We have a lot of cross currents right now and so it's very difficult for investors to pick out the proper path. People like myself think that things are in fact slowing down some, that inflation is not a significant problem, and that while the Fed may tighten policy once in the next couple of months, they really probably don't need to.
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I'm afraid we're not out the woods yet with our friends at the Fed.
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Have been beating the drums about worrying about higher inflation, and so far, other than energy, we haven't had higher inflation. (But) I would say earnings are doing quite well, so I think that's helped to keep the market from having another bad week.
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The fundamentals are still there. We have low inflation, low interest rates and a worldwide demand for American products I don't think you have a problem as far as the market going up.
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