There is a lot of concern right now that we may be heading for a "double dip" recession, and the new home sales figures released today will only fuel that fear. I really don't know how the recovery will play out and whether we will, indeed, have a secondary recession. As I have said before, "no one knows".
What I do know is that the worst case scenarios thrown around during the depths of the credit crisis in late 2008 have not materialized. I also know that corporate America is sitting on an unprecedented pile of cash. It is ultimately corporate profits that drive stock prices, not the daily barrage of economic statistics.
The next few months will prove to be very telling on where we are headed, and the election season promises to be very ugly. I expect global stocks markets to continue their extreme volatility throughout the fall, so unfortunately, we need to hold on tight and keep our eyes to the long-term.
I'll finish this post with a song from country singer Merle Hazard, who often sings about economic topics. It's important that we all keep our sense of humor.