Ep. 215: Irrational Exuberance Trumps All

The Peter Schiff Show Podcast

The Dow 20,000 party is going to have to wait - at least for another day The Dow was down a little bit today - 23 to 19,918 The broader market was a bit weaker than the Dow The markets continue to shrug off very weak economic news that came out throughout the day We got bombarded with all sorts of negative pieces of news that ordinarily, maybe before the election of Donald Trump, would have weighed down the market Certainly it would have weighed on the currency markets The dollar would have been very weak and gold would have had a big rally Instead, gold was down a little bit, and the dollar rose a little bit despite very weak economic data that I will get to I want to start off by focusing on the stock market and the optimism which is really quite ridiculous and unfounded Part of the reason for the rally, though, is a lack of selling We have a lot of people mindlessly buying the markets, but you don't have a lot of selling One of the reasons is that people would rather sell in January than in December People are enthusiastic about Trump's presidency because he will cut taxes If you have a gain in the stock market, why realize that gain now in the waning trading days of 2016 If you sell now, not only do you have to get your check into the IRS by April of next year But also, you've got to pay the current tax rate If you wait until the firs week of January, you don't have to pay taxes until a year from this coming April You have all that time to use the money and the tax rates may be a lot lower So why sell now? A lot of people are being given that advice; don't sell now - wait until January Who knows - this market could ring in the new year with a major sell-off