Where's the Fear?

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The Rude Awakening Tuesday, March 26, 2013 | 1030 Hours Where’s the Fear? The market's take on eurozone contagion... The one "opinion" that matters most... Plus: 2 housing market scouting reports. Greg Guenthner coming to you from Baltimore, MD... Greg Guenthner I believe it is possible to discuss the situation in Cyprus until you collapse from exhaustion. Unfortunately, you'd get absolutely nowhere in the process... But that's what most analysts are doing these days--which is why you're bombarded by an endless parade of unanswerable questions about the latest eurozone catastrophe. What if banks stay closed and rallies turn into riots? Is contagion a real possibility? What if angry Russians show up? At this point, it's all speculation. You have to take the Cyprus developments in the context of the market's reaction as the events unfold. The market doesn't care what you (or I) think. Fortunately, price gives you all the context you need. And you don't have to look back very far to see what a panicked reaction to a potential eurozone meltdown would look like. Less than two years ago, investors practically trampled each other to get to safety at the first sign of trouble in Europe. But right now, the market has not flashed anything remotely close to a crash warning... Today, we're not seeing the rush out of stocks and into gold that characterized the August 2011 correction. In fact, gold continues to trail the S&P this month even after its brief rally back toward $1,600. Even though the yellow metal is heading for its first monthly gain since September, Bloomberg reports that it will clock its first back-to-back quarterly loss since 2001. Ouch... You can yell. You can throw your computer out the window. You can even send me an angry e-mail [Ed. Note: Why not? You'll feel better: rude@agorafinancial.com]. But at the end of the day, the market's the boss. Deal with it. It's clear the collective mood is changing. Despite turmoil overseas, investors continue to favor U.S. equities. Will we eventually see weakness in stocks? Absolutely. Will these turn into buying opportunities? Yes. U.S. equities are where you should be right now. That's not me talking--it's the market. Rude Numbers Targets, Predictions and Wild Guesses $1,598 will buy you an ounce of gold this morning. 61% of stocks trading on major US exchanges were above their 50-day moving averages as of yesterday's close. 2 very important data points--the Case-Shiller 20-city Index and consumer confidence--hit the markets this morning. 83.07 is where you'll find the US Dollar Index this morning as it continues its run-up that began in early February. 74 points dropped from the Nikkei in early trading today as the Japanese index continues to violently swing back and forth... Rude Trends When to Buy... When to Sell I'm a little late reaching out to you this morning because I wanted to wait for housing data to come out. It did not disappoint. The Case-Shiller 20-city Index beat estimates. On the flip side, consumer confidence missed. As did new home sales. We'll see if this affects the all-time highs tractor beam pulling stocks higher this morning... For a more anecdotal look at real estate markets, I'll turn it over to you: "I know there are a lot of indicators out there.  My indicators are how many cars are in the shopping center parking lots, the commute on public transportation and roads, restaurant seating, apartment 'FOR RENT' signs and home 'FOR SALE' signs," writes a perceptive reader. "These seem to be solid in the San Francisco Bay Area and indicate a robust economy despite rising food and gas prices." And another... "Where I live (Idaho), permits for several planned subdivisions recently expired after years of inactivity, and a large farming operation has just petitioned the city council to de-annex one of them so they can get it rezoned for agriculture.  Meanwhile, existing homes continue to list for $80/sq.' or less.  Builders can't compete with that, and I expect reality to set in any day now." [Ed. Note: Send your feedback here: rude@agorafinancial.com... and don't forget to follow me on Twitter: @GregGuenthner] Ignore At Your Own Peril Today's Must-Read Links Check Your Pockets and Your Piggy Bank... And Hoard These Coins What happens when Hollywood meets Wall Street... World oil production is about to be shaken to its core... Additional articles and commentary from The Daily Reckoning on: DR iPhone APP To end The Daily Reckoning’s Rude Awakening e-mail subscription and associated external offers sent from The Daily Reckoning and The Rude Awakening, cancel your free subscription here. 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