Investors all over the world are on hold, waiting to see how the Federal Government crisis, created by Congress, over the debt ceiling and finances, in general, plays out. Early last week, investors were pessimistic and did some selling. Then on Thursday events pointed to a resolution and a stock market rally ensued. That continued on Friday, but over the weekend prospects again looked less hopeful.
Professional investors know that these events in Washington D.C. are a sideshow for the markets unless they go terribly wrong. That doesn’t seem likely, but could happen. So investors continue to wait.
The robust recovery in stock prices late last week clearly shows the strength of this market and professional investors need to put money to work. Without this self-inflicted crisis, stock prices would likely be much higher. In the meantime, we all wait.