With the recent unrest in Egypt, Libya, and some other nations, the market and the economy have made movements in both directions (positive and negative). Commodities, like silver (which hit a record for the past two decades), gold, and oil are rising. Meanwhile, many stocks, after enjoying some gains, have once more fallen because of various factors, including speculator frenzy.
On a similar note, an article in the Philadelphia Inquirer mentioned that "Higher oil prices also weigh on the U.S. economy by increasing the costs of moving goods and filling gas tanks. A sustained $10 increase in the price of oil translates into a 0.2 percent cut in economic growth over 12 months, according to a recent estimate by economists at Goldman Sachs." With the turmoil in the Middle East and Africa, it seems like oil prices are destined to continue their increase. According to the article, this would mean economic growth will continue to decrease. How will this affect stocks? In general, less economic growth would mean less jobs, less expansion, and less GDP. One would think that we are destined to see further declines in the market as a whole. What does everyone else think of all this? Do you see the need to adjust your strategy and possibly look into stocks that perform better when the market declines?
Source:
http://www.philly.com/philly/business/20110226_Markets_rise_but_still_end_the_week_off_about_2_pct_.html
