Make Money Whether the News is Good or Bad

In a recent issue of Barron’s, Vito Racanelli wrote, “Good news is good and bad news is bad, but a lack of bad news can be good, at least for investors.”  The S&P 500 is up 12.6% since its October 3rd low on the back of “a lack of bad news”, according to Yahoo! Finance.

What’s this lack of bad news over the past month?

  • Europe.  After months of tough talk but little action, Europe may finally be about to take action to suppress (even if only temporarily) the sovereign debt crisis, as epitomized by Greece’s dramatic ‘haircut’.
  • Headlines have generally supported the notion that the U.S. economy, although soft, is not collapsing.
  • Corporate earnings so far in the 3rd quarter are pretty good: 75% of companies have beaten estimates, according to FactSet.

I have no idea whether this ‘”lack of bad news” will turn into bad news or good news as we approach the end of the year.  The global economy and geopolitical climate is simply too volatile to predict with any degree of confidence.  However, that doesn’t mean investors cannot still make money.

So, I suggest that you continue to follow Stocks on Wall Street where we work hard to help you profit from all the news – good or bad.

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