Welcome back! I hope everyone had a happy Thanksgiving. In fact, it appears as though many of you did enjoy the holiday — enough to hit the malls in force on Black Friday. According to the LA Times, retail activity was up 16 percent over last year. And the markets are responding: all the major stock indexes have climbed this morning.
Meanwhile, the neverending eurozone crisis appears to have entered a new phase. We keep waiting for an endgame here, with the likely demise of the euro single currency. But then Germany and France get together to pull the eurozone back from the brink. This dynamic has caused predictable volatility in world markets for months now. But in the U.S., there's at least some improving news, giving markets the chance to rally on their own and somewhat ignore Europe.
The question is, How long will it last?
I'm guessing not that long. However, I think U.S. market volatility may become less severe. A lot of this will depend on how the holiday shopping season plays out. But it's probably reasonable to expect that Apple will sell a lot of iPhones and iPads, that Amazon will sell plenty of Kindle Fires and ebooks, and that Google will continue to see its Android franchise grow. Now is the time for all Americans to buy their gadgets.
I should point out that I think monitoring market volatility is pointless, most of the time. When the markets are volatile, everyone pretty much knows it. That said, volatility is sort of like a rain storm. Anyone can look outside and tell you it's raining. But people who keep track of how much rain is falling are going to be better prepared for the floods and landslides. All you really want to know about market volatility is whether it's completely off the charts.
Anyway, volatility aside, it's the American consumer versus the European financial technocrats, competing for the soul of the global economy right now. Who do you think will come out on top?