“The SP looks like another bubble”
It does, but most of my trader buds who were short this past week got seriously hammered. I think we see a decline into the fall, but timing, and deciding from where such a decline might start, is always the conundrum. Earnings, supposedly “impressive”, have been measured against expectations that were literally buried in the ground. Most folks I know who are market savvy are quite baffled, I don’t mind telling you. That includes me. It’s almost as if the market is saying “hey, recessions historically last 18 months, and this one must be just about over.” Just by the passge of those 18 or so months. Despite being the worst since GD1 [it was 25-26 years until 1954 that the DJIA regained its 1929 level] and all that toxic debt which has been simply shoved into some cave somewhere, and lending which has been crushed, and the consumer whose jobs are draining away, and all the stock dilution, and the now prime defaults coming down the road which ANYONE can see...none of that matters.
It’s also possible that the market is anticipating BOTH Gov’t healthcare AND cap & trade failing, but I do not regard (the failure of) either of those as healthy bets at this juncture. It’s darn likely that ONE of them will pass, and either one, never mind both, are minimally economy-roilers if not economy killers. Though maybe the market sees dumping corporate health care plans onto the govt as a great boon to profits.
As I said, color me deeply confused.
The socialized medicine is going to be paid by massive new taxes imposed on corporation and individuals and companies are not going to make any profit by dumping their employees insurance plans because they are going to pay more in taxes to pay for the socialized medicine.
Art Cashin is confused too.
He is even talking about astrology to try to explain this strength.
I used to worry about the complications of social security going upside down in 2017.
I do not worry about 2017 anymore.
1) The govt controls the money
2) Too much govt regulation for business to think about profit
3) Too much political correctness. business money for homos and politicians.
The model for me is from the book Vampire Economy. There was a stock market in Germany, it continued to exist but everyone knew it didn't mean anything.
There is no real stock market under socialism. It is a lottery ticket, betting on what will go up and down.