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Real Time Insight

By now you have surely noticed that the S&P 500 has hit fresh all time highs on the back of weaker than expected retail sales.  This would have been a very logical statement to make about 9 or 12 months ago, but things have changed... or have they?

The idea of a weaker economic indicator, such as retail sales coming in 0.1% vs 0.3 expectation and 1.5% as the prior reading, used to mean that there was still a strong case for more QE.  Keep the QE flowing and the market flows right along with it.

There is a difference between now and then though.  Taper is in progress and the Fed wants to remove all the life support as safely as possible.  So this retail sales number is no longer a case of "bad news is good news" is just plain bad news.

So that said, why is the market pushing higher?  Forget about that negative GDP number and fact that momentum names and recent IPO's have been crushed.  What is driving this market to new highs?

Let's have a discussion about why you think the market deserves to go higher in the comments!

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