Sound Market Advice

Sound Stock Market Advice From Barry Ritholtz.


This market has been on fire since March. I think stock prices are too high but may go higher. Bottom Line: Be Careful! ...and make sure you have stop-losses put in.

Friday Afternoon Linkfest: Required Reading

1. Warren Buffett gives a warning on U.S. debt.

2. Warning: China reduces holdings of U.S. government debt.

3. Andy Xie: New Bubble Threatens a V-Shaped Rebound.

4. 1 in 8 US Mortgages Falling Behind.

5. Barry Ritholtz on the latest existing home sales numbers.

6. FDIC is bankrupt. Read it here. Even though the FDIC is bankrupt it will not run out of money because Congress will most likely bailout the FDIC. Read it here.

7. Mexico decriminalizes small-scale drug possession. Glenn Greenwald on the drug decriminalization in Portugal. Read and watch here.

8. What Would Jesus Do? Ask Obama. The president's troubling use of religion to sell health care reform.

Economy Continues To Contract in 2nd Quarter

According to reports GDP shrank at a 1% annual rate in the second quarter. According to Barry Ritholtz a better estimate would be that the economy shrunk at a 2.38% annual rate.

Also, first quarter GDP was revised downward and consumer spending shrank at a higher than expected pace. According to Yahoo Finance :
"...the Commerce Department revised the first-quarter GDP figure much lower, saying economic activity tumbled 6.4 percent. That is the worst quarterly reading in nearly 30 years.

The latest report also said consumers cut spending by 1.2 percent in the second quarter, after a 0.6 percent increase in the first quarter."