I know nearly 300-point rallies are common during bear markets as we witnessed some of the largest nominal point gains in market history as the Dow was in the process of purging the excess from the late 90s tech bubble between mid-2000 through late 2002. So today’s largest point gain since 2002 for the Dow should not come as a big surprise. The unfortunate part is that most don’t see it that way. Most feel a sense of relief and a return to normalcy of ever rising stock prices. It just adds to the complacency. Again, a two-week correction that saw the S&P drop 7-percent from its all-time high is not even close to sufficiently purging accrued excesses over the last five years. A period that encapsulated the most absurd period of egregious irresponsible lending this world has ever witnessed? After today’s close, the Dow Jones Industrials now rest essential where it closed out the month of June. Given the incremental chunks of wisdom garnered since then as it concerns the “private equity put,” leveraged hedge funds and the clear signals being sent by the conduits of this credit orgy, the major investment banks, things have taken a decidedly nasty turn for the believers of “Goldilocks.” For those that didn’t get a chance to tune into the chatter on CNBC USA today, it was quite amusing. These folks are so incredibly predisposed to want to believe in Easter Bunnies, Santa Clause among other fairytales that you would think that last week and all the data confirming some pretty serious issues within credit markets never happened.
No comments:
Post a Comment