Dow had one outsanding week

Stocks had their best week in 4 months, not to mention one of their best weeks in history. Dow rose almost 600, more than 7% on the first wave of Q2 earnings reports. Caution is being thrown to the wind with expectations of more "good" earnings reports to come. The best performers in 2009 have been big name tech stocks: IBM (IBM), Google (GOOG), Apple (AAPL), etc. & high yield securities.

The VIX, volatility or risk index, has plunged to levels (24) not seen since the Lehman collapse. The greater acceptance of risk brings out buyers for high yield securities. MLPs must be having the biggest gain of any group in 2009, up an astounding 35%. Last week, it added 12, taking it to 238. REITs are down YTD & have had a choppier ride this year, but also did quite well last week. The Barclays High Yield Bond Index understates the stories for individual junk bond funds, but shows the trend of higher prices in 2009.


VIX --- 2 weeks




Alerian MLP Index --- 2 weeks




Dow Jones REIT Index --- 2 weeks




Barclays Cap Hi Yld Bond ETF - 2 weeks




Gains are fun while they last. Dow just needs another 60 to set a new high for 2009. But it will have to fight off economic reality: unemployment is forecasted to top 10% before beginning its descent, housing is a disaster, retail sales are weak & California's $26B budget deficit is a looming disaster.