Although we don't believe in timing the market or panicking over daily movements, we do like to keep an eye on market changes -- just in case they're material to our investing thesis.
The latest news out of Washington is encouraging, even as time runs short -- we're now two days away from the Treasury's announced Oct. 17 deadline to lift the debt ceiling. The initiative is now with the Senate, where lawmakers are working on an agreement that would simultaneously end the government shutdown and lift the debt ceiling.
Here are the broad strokes of the proposal at this stage, courtesy of The Wall Street Journal:
- The government would reopen at current spending levels until Jan. 15.
- The debt ceiling would be extended until early February.
The proposal includes no significant restrictions on Obamacare but calls for negotiations on long-term budget issues to begin on Dec. 13. If passed, this proposal would not be a great outcome, as it sets up yet another standoff within a relatively short time frame, which is quickly becoming standard operating procedure for Washington.
Still, it's a lot better than the alternative: no resolution, leading to a technical default. In truth, it's also better than a previous, now-abandoned proposal from the House that would have pushed the debt ceiling out until the middle of next month, with no resolution on the government shutdown. For that reason, I think that if the Congress and White House come out and announce they have arrived at this latest deal, it could give stocks a healthy bounce.
But what do I know? Robert Shiller, who received the Nobel Prize in economics yesterday for his work on stock market volatility and valuation, appeared on CNBC this morning. Commenting on the tussle in Congress and its impact on the stock market, he said: "It's a wash. I don't see any clear outcome for the markets. So, I don't have any alarm bells for the market at this moment."
For now, though, the market appears to be adopting a "show me" attitude, with the S&P 500 and the narrower, price-weighted Dow Jones Industrial Average (DJINDICES: ^DJI ) down a modest 0.1% and 0.14%, respectively, at 10:15 a.m. EDT.
Apple's high-profile fashion hire
Angela Ahrendts, CEO of fashion company Burberry, will leave her post in mid-2014 to join Apple (NASDAQ: AAPL ) as a senior vice president, reporting directly to CEO Tim Cook.
Rahul Sharma, managing director of Neev Capital, told Bloomberg Television that Ahrendts is "going out on a high. This whole team has actually transformed Burberry from what it was 10 years ago to what it is today. A super-cool, young, if that were possible, luxury brand."
That last sentence encapsulates much of what Apple aspires to be. We know that the iPhone maker wants to position itself as a high-end lifestyle brand, not a plain technology company. This latest hire is right in line with that goal.
Apple: Beyond the iPhone and the iPad
Apple has a history of cranking out revolutionary products -- and then creatively destroying them with something better. Read about the future of Apple in the free report, "Apple Will Destroy Its Greatest Product." Can Apple really disrupt its own iPhones and iPads? Find out by clicking here.