Market Digest \u2013 Week Ending 11\/22\r\n\r\nIt was a slow week in the capital markets, unless you count Bitcoins which were up over 100%. Stocks were flat and bonds were down modestly. Fed minutes released Wednesday revealed talk of tapering and suggested bond purchases are likely to be reduced in the coming months. The S&P 500 crossed 1,800 during Monday\u2019s trading session, and finished the week above the milestone level. Meanwhile, the Dow closed above 16,000 for the first time on Thursday. Gold fell.\r\n\r\nWeekly Returns:\r\n\r\nS&P 500: 1,805 (+0.4%)\r\nFTSE All-World ex-US: (-0.1%)\r\nUS 10 Year Treasury Yield: 2.75% (+0.04%)\r\nGold: $1,243 (-3.5%)\r\nUSD\/EUR: $1.355 (+0.4%)\r\n\r\nMajor Events:\u00a0\u00a0\u00a0 \r\n\r\n \tMonday \u2013 The price for Bitcoins rose 50% as regulators met to discuss the virtual currency and Fed Chair Bernanke said the Fed had no plans to regulate it.\r\n \tTuesday \u2013 Federal regulators announced a formal probe into Tesla car fires. The stock dropped 12% for the week, but remains up 250% for the year.\r\n \tTuesday \u2013 New York City raised the legal age to buy tobacco from 18 to 21.\r\n \tTuesday \u2013 President Obama said the government needs to stop \u201cgoverning by crisis\u201d and that he does not expect another debt ceiling crisis in January.\r\n \tWednesday \u2013 Fed minutes indicated central bank officials could start scaling back bond buying at one of the next few meetings.\r\n \tThursday \u2013 The Treasury Department said it plans to sell its remaining GM shares by yearend. The government spent $49.5 billion on auto bailouts and is expected to take a loss.\r\n \tFriday \u2013 The nation paused to mark the 50th anniversary of President John F. Kennedy\u2019s assassination.\r\n\r\nOur Take: \r\n\r\nIn a Bloomberg poll released this week, 82% of responders said internet and social media stocks are at bubble levels. 73% said Chinese home prices are at frothy levels and 69% felt the same of London real estate. 31% said US property prices were unsustainable and over 30% said the US Treasury market was in bubble territory. Only 20% said the US stock market is in a bubble, but 45% believe it is \u201cclose\u201d.\r\n\r\nThat\u2019s a lot of bubbles. Bubble talk makes us feel good. Real bubbles are not widely appreciated until after they pop. Internet stocks in the late 90\u2019s were a bubble. Certain sectors of the subprime credit market were a bubble in the last decade. But just because something may go down in value doesn\u2019t mean it is a bubble. Asset prices go up and down. These short term moves are usually best ignored. It is the once in a generation declines (or twice in the case of the last 15 years) that matter. Real bubbles form on optimism, not pessimism. If so many people expect a crash, it is difficult for them to be right because most of them would have already sold.\r\n\r\nMuch of the current fear stems from the unknown impact of the reduction of stimulus from the Fed. Unless the Fed stops buying bonds and actually starts aggressively selling them, we believe this worry is already priced into the markets. We don\u2019t know what the markets will do in 2014, but the current bubble in bubbles is a bullish factor.