(As of 7:07 am PST)
Stock markets have stabilized
after surging based on a 'fiscal cliff' compromise package. Yesterday's hint by the Federal Reserve that
bond buying may end in 2013 sent shivers through the investment community
because it indicated that massive economic stimulus may start to unwind. Stimulus programs have aided markets since
the crash of 2008, giving easy money leverage to hedge funds and other
investors. Any type of stimulus
reduction would result in deleveraging and could cause markets to decline. Currently markets are near unchanged. Gold is taking a beating, down over 1%, while
oil is down slightly. Most commodities
are down while the US currency is close to unchanged. Interest rates are up over the last few
days. There are still some big
challenges early this year, including the debt ceiling which will soon need to
be extended and the implementation of forced budget cuts in the 1st
quarter.
