Interest rates on hold.
Iron ore down, again.
Gold had its biggest one-day drop since mid-July.
The Aussie dollar down, a little more.
The share market didn't correct, again.
It's business as usual, Foolish readers, except for one little fly in the ointment.
Shares in my Canadian-listed oil junior — Manitok Energy — fell another 11.5% overnight, likely on the back of a combination of panic selling, and a fall in the oil price.
If I didn't have a diviersified portfolio, and if a number of other stocks in my portfolio — including some our Motley Fool Share Advisor recommended ASX-quoted stocks — weren't making new highs, I'd be crying into my morning coffee.
As it so happens, I couldn't be happier. The lower the share price of Manitok Energy now, the bigger my potential gain in the future.
That's the plan, anyway. As I said yesterday, when the strict Motley Fool trading rules allow, I plan to add to my already significant holding in Manitok Energy, likely next week. Wish me luck.
Yes, luck.
There are never any "sure things" when it comes to stock picking, and don't let anyone tell you differently. In my 25 years of investing experience, I've learnt to expect the unexpected, especially when you least expect it. And, you need a little luck, too.
Speaking of sure things, I must admit Morgan Stanley's call that the S&P 500 could jump as high as 3,000 by 2020 caught me by surprise.
Heck, the benchmark US index has only just breached 2,000.
Give the bears a break, Morgan Stanley. They are still hanging out for a market correction, like they have been since the GFC.
Bloomberg reports Morgan Stanley's report as saying…
"Equities should benefit from a scenario where the probability of a cycle peak remains low for some time. As the prolonged expansion becomes more visible, we'd expect a materially higher U.S. stock market."
It's definitely not out of the question. The US economy is recovering nicely. Interest rates are likely to stay low for an extended period. And the stock market, over time, goes up, and up, and up.
For those following at home, if the boffins at Morgan Stanley are right, we're looking at a further 50% upside for the S&P 500 from here.
As for Australia's own S&P/ASX 200 Index, a 50% uplift from here would take our benchmark index to around 8,500, in the process smashing through its October 2007 high of 6,750.
Records are made to be broken. Who ever thought that an athlete would ever be able to run 9.58 seconds for the 100 metres? Or that the world record for the fastest century in a one-day international, would now be just 36 deliveries?
* Bonus points for naming the record breaking batsman. Answer revealed below. My guess is only 1 in 5,000 of readers of this email will know the name of this international cricketer, without looking it up, of course.
Anything is possible.
That said, when it comes to share market investing, nothing ever goes up in a straight line.
Emotions are involved. People get greedy. They panic. They get scared. Markets wobble. They correct. Occasionally — very occasionally — they crash.
But over time, the direction is inexorably up. Amidst all the day to day machinations of the market, the latest unemployment figures, the housing approval number and the price of corn, as the world economy grows, and corporate profits grow, so follows the stock market.
Now if you think the world economy is going to hell in a hand basket, chances are you're not even reading this. You'll be down at Aldi stocking up on baked beans and bottled water, surrounding yourself with fast depreciating bars of gold, and preparing your underground bunker for Armageddon.
Such behaviour didn't make Warren Buffett his billions… but each to their own I guess.
Overnight, US markets did nothing, the S&P 500 losing a measly one point to close at 2,002.
Quoted on Bloomberg, Joe Bell of Schaeffer's Investment Research summed up the mood of the market…
…"after that strong rally we had through much of August, the market is taking a bit of a breather."
While the ASX had a flat August, the S&P 500 rallied 3.8% over the month. And if Morgan Stanley are right with their long-term prediction, there could be plenty more gains ahead for US markets.
Buying US stocks is easier than you think. My portfolio is chock full of them, and I'm looking to add more, especially while the Aussie dollar is still riding high.
Back in Australia, and blow me down if The Age isn't reporting Australia and New Zealand Banking Group (ASX: ANZ) chairman David Gonski, as warning Australia's booming housing prices cannot go on forever and the market will eventually experience a correction.
"… anyone who believes prices always go up is, I think, a fool."
Talk about turkeys voting for Christmas…
Or billionaire mining magnate Clive Palmer voting to save the mining tax…
Not that the warning has had any effect on the share prices of the big four banks. ANZ shares are up a few cents today, as are the other big banks.
The word "fool" is getting a bit of a work out, coming after Christopher Joye's recent line…
"Anyone not worried about current Australian house price dynamics is a fool."
In Shakespeare's play As You Like It, our Fool, The Motley Fool, was the only person who could tell the king the truth without getting his head lopped off.
In the traditionally opaque, over-charging, under-performing financial services industry, The Motley Fool is here to tell you the truth, encouraging you to take control of your money, and to help you invest better.
My guess is, when it comes to property prices, there are a number of fools (as opposed to we Fools — note the capital 'F') out there, especially those being sucked into gearing into property, via their self managed super funds.
It will end in tears. Not today, not tomorrow, not this year, and maybe not even next year.
The simple truth is when unaffordable house prices collide with either rising unemployment or rising interest rates, the only way for house prices is down.
And that's the Foolish truth.
* On January 1st 2014, New Zealand all-rounder Corey Anderson cracked the fastest century in one-day international history, reaching three figures in just 36 deliveries against the West Indies.
