If the Economy Is Tanking; Why Are Markets Up? (What's encouraging investors?)

The latest economic data released Thursday confirms what all Americans, especially business owners, already knew. Economic growth has slowed down to a measly 1.5% (from 2% the previous quarter), job growth continues to languish with nationwide unemployment at a dismal 8.2%, consumer confidence has fallen to its lowest level this year, and consumer spending is also tanking. Household purchases, which represent approximately 70% of GDP, grew at the slowest pace in a year. Recent surveys show that Americans have lost approximately 40% of their net worth in the last few years, and poverty rates are reaching levels not seen in this country since the 1960s.

So, why are the markets up? Everything confirms that our bleak economic situation just got worse. Obama's anti-business, anti-job growth, and punitive taxation schemes have not changed. The administration's stifling and oppressive regulatory policies continue unabated. The European situation has not improved or stabilized much, despite repeated assurances from the European Central Bank. The Federal Reserve in the United States is already out of options, despite speculation from the so-called financial "experts" who believe that another round of "stimulus" may occur, even though the Fed signaled just the opposite last week. Given the poor record of previous easing and the near-zero interest rates, there is very little the Fed can do now.

So what could possibly have influenced the financial markets to push the Dow Jones, S&P 500, and Nasdaq averages into solid positive gains for the day?

Because with the bad economic news, the expectations of a third quantitative easing from the Fed is expected. So bad news == good news. The last two easings resulted in two market rallies, which then dissipated. The market is expecting to be rigged by the Fed, not expecting earnings growth and heightened consumer demand — because it is clear those are not present.

Maybe.

Or maybe Bernanke will do ANYTHING to get his messiah re-elected including QE3.

That and the market’s exuberant reaction to President of the ECB, Mario Draghi’s ‘Believe Me’ bullshit speech .

I think the markets are wholly addicted to govt. money printing and NO WAY Europe of the Fed will allow their Beast system to crash.

“Pump-n-dump?”
_____________________________

That is what I call it.
Fat cat investors such as Soros and Buffet, with exotic computer programs doing the pump and dump.
As I say, it is no longer your father’s stock market.

I no longer see the stock market having any relationship
to real life economic conditions.

The end of the current Anti-business regime will enable the economy to begin recovering. Yes.
But also...
when the Fed prints more dineros (”QE-3 or 4”)...
these $$$ are put into the big banks (which are allowed to invest now, since that wise restriction was lifted).
Given how WashingtonDC has been depressing the economy, there is very little demand for any loans, or at least any loans that the banks feel they can afford to risk writing. So, much of the newly-printed money goes into the stock market instead.
This creates a (n artificial) stock market bubble even if normal investors are far more cautious.

[ Why Are Markets Up? ]

There is profit in capitalizing socialism.. Look at China..
-OR- in socializing capitalism.. same evil thing..

Socialism is a lie.. a scam.. but some will buy it..
There are suckers born every minute.. unless they are aborted..

RE: Markets are up because investors and business are
looking forward to November and a change of regime
and just can’t wait.

_______________________________

REALLY? How to explain this site ( where traders put REAL MONEY into how events will turn out ):

http://www.intrade.com/v4/home/

Barack Obama to be re-elected President in 2012

57.0% CHANCE

Last prediction was: $5.70 / share

Today’s Change: +$0.01 (+0.2%)

Just part of the turbulence. The markets for real estate, precious metals, currency and stocks are all in a turbulent phase. So they go up and down. On the whole those who put in money into the markets near the peak during QE2 are down. The markets are moving up again due to rumors of an impending QE3 which will cause inflation. Whenever these rumors pick up, people move out their currency holdings into the other forms.

As a few have mentioned, its all about the anticipation of QE3. Since the Economy is taking, traders think that the Fed (Bernake) is more likely to print more $$. The irony here is that the anticipation of QE3 may give the market a bigger boost than QE3 itself. In fact, its possible the the QE3 euphoria may last just days once its announced—before the Market goes into reverse.

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