You Just Kissed Your Sister

The S&P 500 Index started the year at 2058.90 and by the end of March 10, 2015, we find ourselves at 2044.16, which is actually a little worse than breakeven. Didn’t we just reach new market highs as recent as last week?

It is no fun “kissing your sister”. For those unfamiliar with that phrase, it is a commonly used sports term referring to a tie score after playing a full game. Sure, you didn’t lose, but you don’t feel great walking away, much like metaphorically kissing your sister. The origin of that phrase proves difficult to track down by the way and is attributed to many coaches over the years. The first use of the term in print dates back to 1954 when Navy coach Eddie Erdelatz used it, who is also credited with the phrase “When the going gets tough, the tough get going” from 1956.

Some may point to the fact that this same scenario played out last year when the market dipped in the first quarter of 2014 and it was almost mid-April before we reached breakeven again. Last year the S&P 500 Index finished up a solid 13.69% including dividends. We will be very lucky to see double digit returns this year with the Fed likely raising rates in June, the strong dollar and serious weakness in commodities. Bonds are falling, oil and gold plunging and now the stock market is showing some weakness, which means everything is starting to correlate to 1. Another 8-9% drop from here would not be surprising.


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