Are We Back to a Goldilocks Market?

Looking over the data (i.e. this morning GDP revision to 2.2% from earlier release of 2.6%) this week one has to now ponder once again if we are in a Goldilocks phase in the market (stocks and interest rates).

GDP, employment and inflation all point to a scenario where the economy hums along at just a good enough pace to keep interest rates at current (or lower) rates while S&P500 earnings are just hanging in there to the point where the stock market can trend (little up and a little down) for a very long time.

Globally we have a dozen issues that could all cause a black swan type event–although since we know about them they wouldn’t be true black swans–the question is what event is going to derail investing in the coming months?  We could list them all, but everyone knows them already, so no point in rehashing them.

We are impatiently awaiting new issues or ‘bargains’ to pop up so we can do a little buying. The life of an income investor can get a little boring–but what the hell–holdings are performing well so why mess around with buying and selling just because one gets a little bored.

The only area we are watching closely is the REITs which seem to be in a correction type mode being down 8-9% from the 52 week highs.  This is the best area to look for bargains in at this point in time.