1) When will the Treasury Department declare that it has run out of the capability to borrow money? It certainly is soon — everyone cites the end of February, but it could make a statement at any time. January will be dominated by worries that the rating agencies will warn of a U.S. downgrade.
2) A muted Christmas. There's lots of reasons to expect retail sales would be good this holiday season. Home prices are UP nearly 10 percent this year (a major drive of consumer sentiment), gas prices are way down, and the S&P 500 is up 14 percent year-to-date. With those stats, you would think retail sales will be strong.
But it doesn't look that way. Whether it's the cliff, super storm Sandy, or the events in Newtown Conn., you can't escape the feeling that the Christmas spirit is muted this year. I shopped in downtown Philadelphia Saturday and Sunday, and the crowds were thinner than in previous years. I saw 50 percent off in Ann Taylor, and other discount signs at Express, Guess, and other retailers. Others have noted this too: Nomura, in a note to clients, commented on the "CNN effect and a somewhat depressing holiday mood for consumers," though it has not lowered sales estimates — yet. Look for another squeeze on margins.
One company with a lot of sales promotions: J.C. Penney, n a change from its "Every Day Low Pricing" strategy. Oppenheimer noted this morning that those promotions were showing signs of success, with store traffic strong and clearance racks empty. (Read More: This Year, There's No 'Super' in Super Saturday)
3) Still no inflows into stocks: Outflows of $6.4 billion from equity funds ending the week of Dec. 19, according to Lipper, but for the first time in a long time there were also OUTFLOWS from taxable bond funds ... pretty modest, at $1.6 billion, a small fraction of the nearly $3.6 trillion in bond funds, but, hey, it's a start.