We had an amazing 2 year run and things look more positive every day ... commodity prices making new highs, optimism and complacency is back, job market is looking a little bit better, real estate is holding strong and stock market has been on a tear.
But wait, inflation is back!!! prices are starting to creep up - for me personally, it has been gas prices and property taxes. I am a pretty good shopper - sales, coupons, discount places etc, so I am able to continue to look for bargains to minimize price increase in food and goods, but gas prices are starting to sting. Soon, there will be price increases in everything as businesses catch up.
on Thursday last week, I had a minor bout of "panic", started to observe that some of my stocks were not following the commodities - i.e there was downward selling pressure on stocks while gold, copper, oil were all making new highs. Bad sign. I took profits and sold the bulk of my gold and copper holdings. Still have oil as a hedge, but drastically reduced my exposure (still about 40% invested but no where near the peak I was at).
Going to watch the market closely over the next little while and maybe even shift more funds into cash to wait.... yes my friends will say this is timing the market, but when I don't know where things are heading to, I like to stay on the sidelines and observe for now. problem is there are no other viables places to park cash - GIC's pay less than inflation, real estate is also getting ahead of itself with the low interest rates. if anyone has good suggestions, please post.
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