This Week: Actually, the week starts on Wednesday although Monday markets will be open in shortened trading. (Stocks close at 1:00, bonds close at 2:00). Many global markets are closed but here in the US for reasons unknown to mankind our markets are open; nothing new, however, it’s been this way for decades. This week has two housing data, November new home sales on Thursday and November pending home sales on Friday. The only thing of importance this week is the Cliff. Congress is due back on Thursday; the Administration is in Hawaii.
Based on comments, there is no plan that both parties will agree on. There is an increase in the view that we will go over the Cliff. Going over it has been built up to a serious fear factor within markets, but now with the Cliff moving closer many are thinking going over won’t be that serious. Of course, that is based on the further view that there will be a deal to keep taxes from increasing before the IRS can issue new withholding tables.