I was on my way to get a bag of flashlights in the basement of our home in western Connecticut.
This was in preparation on Feb. 8 for the arrival of Winter Storm Nemo.
To get there, I had to pass famous front pages I have hanging in a row on the wall.
One page jumped out. The front of a Boston Globe. Headline: “Worst Storm of the Century: 17 die … record high tides … up to 4 feet of snow … winds gust up to 125 mph … highway traffic banned.”
The dateline: Feb. 8, 1978. Thirty-five years ago, to the day.
Coincidence? By the next morning, 21 inches of snow had been deposited on my yard. Milford, Conn., got 38 inches.
Which brings to mind another seeming coincidence. The S&P 500 has crossed 1,500 again. For the third time.
The first time this happened, the dotcom bubble was already in progress and the benchmark would lose 45 percent of its value by February 2003, exactly 10 years ago.
The second time it happened, was in May 2007. By October 2008, it reached 1,549.
The credit crisis was in progress that time. The index lost more than half its value by the end of February 2009. Four years ago.
Sure, stocks have gotten a big boost of confidence at the outset of 2013.
In the four weeks that ended Jan. 30, mutual funds that invest in equities picked up $20.7 billion.
That has not happened since April 12, 2000, according to Lipper head of research services Tom Roseen.
Investors are coming out of the closet. Pulling funds out of money market funds, for instance, and putting the money back to work in both equity and fixed-income funds.
They’re even getting on the “risk train,” he said. Sure, $1.5 billion got put into funds that invest in large cap stocks. But $1.2 billion got put into emerging market funds. Risk on.
All told, the return for the average stock fund hit 4.82 percent … for the month. Heady stuff.
But let’s not get carried away here.
Yes, 68 percent of S&P 500 companies are beating expectations on the bottom line, as Roseen notes.
But don’t expect a big ramp-up in trading volume. The boosts to the bottom lines are not creating corresponding boosts in employment. The Fed is still committed to its nearly-no-interest-rates stimulus through 2014. And baby boomers-now retiring-must keep working, long past the norm, to survive.
Most critically, somewhere not far down the road, the U.S. will have to stay paying down its bills.
If past is prelude to the future, you should get ready for the next storm, now.
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