I wanted to begin this week’s eletter with a pre-apology for sounding like a broken record. However, before I give you a chance to accuse me of that, I must make a quick confession: as I sat down to write, it occurred to me that it’s quite possible that the expression ‘broken record’ would be meaningless to many of our readers, especially if they are under 40-ish years of age.

Now, as anyone that age or wiser can attest, there was a long period of time where we all enjoyed our music by playing vinyl records on our record player turntables. We might have also listened to records being played on the radio — which was possible only because the radio station played the music on their record players. This was a wonderful bit of technology but there were a few problems. One such trouble was that vinyl records could easily be damaged. Even a small surface scratch could prevent a player’s stylus from tracking a groove correctly and possibly produce a repeating of the same recorded phrase over and over again. Hence…’sounding like a broken record’.

Well, I do hope you enjoyed that story and at least you have been forewarned that I am about to tell you something that you may have heard us say before:

  • Our current Bull Market continues to show he’s got room to run.

Perhaps surprising is the sheer number of things in general that actually support a good dose of continuing optimism — after already turning in some rather spectacular numbers. In the first eight days of 2018, the Dow has broken five records. In 2017 it broke 70 records. In fact, since the 2016 elections the Dow Jones Industrials have broken a whopping 92 new record closing highs.

You may recall that, in past years, we have mentioned the ‘January Barometer Theory’ and how it purports to predict that whatever the markets do in the first week of January they will also likely replicate in the month as a whole…and however they do in the month is then likely to be what they will do for the year. While you can’t take that to the bank (not yet anyway) it seems to be true much more often than not. If it will be true for 2018 no-one knows. But, we can be encouraged that markets typically rise in earnings seasons and the current general feeling is one of buoyancy.

However, the horizon is not without a few storm clouds.

Congress must find agreement on a spending bill before the 19th. That’s when the current funding’s coach turns into a pumpkin. Another concern is that optimism has become so popular that share prices are thought by some to have gotten pretty rich. So, if we encounter a pullback we should not say it was fully unexpected. The occasional consolidation is usually a good thing. If that does happen, and it may, we will then expect to get back to the strong likelihood of breaking a new set of records. In that sense I don’t mind at all being told that we sound like yet another broken record.


Ronald P. Denk, CFP®
Investment Advisor
Denk Strategic Wealth Partners
10000 N. 31st Avenue, Suite C-262
Phoenix, AZ 85051

Phone (602) 252-8700
Fax (602) 252-8701
Toll-Free (877) The-Denk


This weekly article reflects news, commentary, opinions, viewpoints, analyses and other information developed by Denk Strategic Wealth Partners and/or select but unaffiliated third parties. DSWP provides Market Information for illustrative and informational purposes only. If you wish to receive this weekly commentary by email please contact us at 602-252-8700 or by e-mail at lindaw@denkinvest.com. If you are receiving this commentary via email and would prefer not to please let us know either by email or phone.

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