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Finance For Dummies

Finance For Dummies offers personal finance information on investing, retirement investing, finance, insurance, credit cards, loans and more. Personal finance education is our goal.

Saturday, October 07, 2006

The Stock Market

The Dow Jones Industrial Index broke through its all-time high this week. This can be interpreted in many different ways by investors. Does this mean more records being broken? Is this the peak before the fall? Is the stock market truly reflecting America’s financial state?

These are good questions to consider when deciding where next to put your money. The Fed has stopped raising rates and this will affect other parts of the economy. Oil prices are down and that means costs for many companies will be down. There is an election coming up on November 7th. There are still many problems in the Middle East that will not be solved overnight.

When times are good in any type of market (see housing) the common notion is to believe the good times will continue. But all markets move in cycles—the problem is that you cannot predict these cycles.

With that being said. I believe a strong argument can be made either way. There are a whole bunch of negatives out there and many positives as well. But cycles must run there course. Do you think there is more good news coming or bad?

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