It’s already Tuesday in New South Wales and blogger OSO is drinking coffee and trying to make sense of the insanity which went down while he and his mates were asleep.
This show has got to be reaching a climax, but while each day seems crazier than the last Doom will continue to look for perspective anywhere we can.
Berserk Market Behaviour
by OSO
Bloomberg:U.S. stocks staged the biggest rally in seven decades on a government plan to buy stakes in banks and a Federal Reserve-led push to flood the global financial system with dollars.The Standard & Poor’s 500 Index rebounded from its worst week in 75 years with an 11.6 percent advance, its steepest since 1939, and the Dow Jones Industrial Average climbed more than 936 points. Morgan Stanley soared 87 percent after sealing a $9 billion investment from Japan’s Mitsubishi UFJ Financial Group Inc. Alcoa Inc., Johnson & Johnson, Chevron Corp. and Prudential Financial Inc. posted their biggest gains since Bloomberg began tracking the data. Europe’s benchmark index climbed 10 percent, its best jump ever, and Asia’s added 3.1 percent.
“The worst of the immediate danger is past,” said Bruce McCain, chief investment strategist at Key Private Bank in Cleveland, which manages $30 billion. “It’s always easier when you’ve got markets going up and you’re not having to talk clients back in off the ledge.”
I don’t know who this Bruce McCain is but his words might just come back and bite him so hard on the bum that he won’t be able to sit down on his financial seat.
Volatility is the key here. This incredible market rally is a result not of certainty, but uncertainty. I would prefer a week where the market advanced or contracted not more than 0.5% per day. That sort of behaviour would indicate a return to normalcy, not a financial roller coaster ride.
The reality is that the US economy is still contracting, unemployment will continue to grow and houses will continue to foreclose. Today’s rally does not presage a return to normalcy, nor does it indicate that the worst is over.
Quote from the character George Parr;
“We’re back to happy days again”
Thanks to the international teamwork of the great financial sophisticates appointed by Government leaders, we can all rest easy again. Except California, Florida, Michigan, etc. etc.
Igor says: pathetic
Hutch-
Once more Igor demonstrates that the great financial minds of this nation don’t have the brains of a spam filter.
John-
I wish we could get said great financial minds to check out our masthead.