http://blog.mutualdecision.com/articles/2007/12/10/cosmetic-surgery-is-a-leading-economic-indicator en-us 40 Insight from the minds behind MUTUALdecision <div>A front page article in Saturday&rsquo;s Wall Street Journal, <u>Evidence Grows That Consumers are Pulling Back, </u>discussed the slowdown in spending on cosmetic surgery as a harbinger of a recession. &nbsp;(I&rsquo;d like to link to the article but The Wall Street Journal doesn&rsquo;t allow it.&nbsp;Hopefully, Mr. Murdoch will change this now that he owns the paper.) &nbsp;It seems as if spending on such surgery had previously been recession-proof.&nbsp;Perhaps it fell under the heading of consumer necessities.&nbsp;Now cosmetic surgeons are feeling the economic pain.&nbsp;The article specifically mentions a drop off in corrective eye surgery and breast implants.&nbsp;There used to be a hemline indicator for the stock market.&nbsp;For every decade starting with 1900, the stock market rose and fell following the length of women&rsquo;s skirts.&nbsp;It would be politically incorrect for me to suggest an implant indicator, so I won&rsquo;t.&nbsp;</div> <div>&nbsp;</div> <div>Are we heading for a recession, and a 15% decline in the stock market from its present levels?&nbsp;Plastic surgeons might say yes.&nbsp;Last week, though, the stock market said no.&nbsp;The popular indexes were up close to 2%.&nbsp;The past two weeks rally has moved the S&amp;P and the NASDAQ close to their 2007 highs.&nbsp;The Dow has lagged somewhat, positioned approximately halfway between its 2007 high and low. &nbsp;The market responded positively to an anticipated Fed rate cut.&nbsp;We&rsquo;ll find out on December 11^th what the Fed intends to do, but a &frac14; point cut seems baked into the market and some expect a &frac12; cut.&nbsp;After that&rsquo;s out of the way, the market will again be left to ponder the likelihood of a recession.&nbsp;On the plus side, the Q3 productivity number was excellent and Friday&rsquo;s report of 94,000 new jobs created, although slightly below the magic 100,000 number, was encouraging.&nbsp;</div> <div>&nbsp;</div> <div>The not so good news for the week was delinquent mortgage payments hitting their highest level in 20 years and foreclosures reaching record levels since they&rsquo;ve been tracked, beginning 35 years ago.&nbsp;The value of existing homes is expected to continue falling into 2009 and level off 15% below 2006 values.&nbsp;Neither the administration&rsquo;s subprime mortgage freeze nor a cut in the Fed Funds rate will solve these problems.&nbsp;As for the Fed, a &frac12; point cut would be an admission of just how worried it is about the economy.</div> <div>&nbsp;</div> <div>The stock market is over bought right now.&nbsp;Wait until after December 11 and see what issues the market is focusing on before you commit any new money to equities.&nbsp;If you&rsquo;re overweighed or nervous, reduce your equity exposure today.</div> Mon, 10 Dec 2007 14:49:00 -0600 urn:uuid:a1f2880e-d1fa-406f-b021-52fb8fe5eb21 Bill Byrnes http://blog.mutualdecision.com/articles/2007/12/10/cosmetic-surgery-is-a-leading-economic-indicator Market Mutual Funds Mutual Fund Blog Market Economy Recession Try rssnewsdigest.com, a new comprehensive news aggregator. With rssnewsdigest, you don ’t really have to go anywhere else. <a href="http://rssnewsdigest.com" rel="nofollow">http://rssnewsdigest.com</a> Thu, 03 Apr 2008 07:52:37 -0500 urn:uuid:ca373642-61ab-4b77-8647-a52d58ed9aa6 http://blog.mutualdecision.com/articles/2007/12/10/cosmetic-surgery-is-a-leading-economic-indicator#comment-202