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Recession Has Ended But Has the Bull Market?
Short-term traders continue to dominate…
The Great Recession has ended. Halleluiah! It was the worst recession in many ways since the Great D. Just imagine. After four straight negative quarters the economy recovered in the third quarter. Not only did it recover, but GDP rose 3.5% in the third quarter, even more than the consensus forecast of a gain of 3.2%.
The relief is so great you can . . . . well, you can hardly detect it.
The stock market loved it – for about seven hours, with the Dow closing up 200 points on Thursday after the report was released. The market…
Be wary of U.S. treasury bonds in 2009
There’s a potential serious problem shaping up
Last year was not only an unusual year for the stock market, but also for bonds.
It’s no secret that as the interest paid on bonds (the yield) declines, the prices of bonds rise. That’s because if you own a bond that pays you a yield of 6%, and new bonds being issued are only paying 4%, investors will pay more for existing 6% bonds to obtain the higher yield.
In the opposite direction, when bond yields rise, the price of bonds decline.
So last year provided a dramatic contrast in that regard between U.S. Treasury bonds,…
6Jan2009 | Street Smart Report | 0 comments | ContinuedSmart money’s buying what they sold awhile back
Bear markets return stocks to their rightful owners
The largest sectors of the economy continue to plunge into a seemingly bottomless hole; the housing industry (where it all started), the financial sector still locked in a credit crisis, the giant auto industry possibly within weeks of major bankruptcies, retailers struggling in their worst holiday season in decades.
Almost three million jobs have been lost since the recession began last December, more in the last six months than in the entire 2001-2002 recession. The loss of 533,000 jobs in November was the largest monthly decline since December 1974.
Investors have lost several $trillions…
Bear market won’t be hibernating anytime soon
Inverse ETFs best bet for bigger, easier profits
In a speech last Tuesday, Fed Governor Janet Yellen became the first senior member of the Federal Reserve to proclaim that the U.S. economy is in a recession.
Last fall, and again in January, I outlined why I expected a recession would begin this year, and why it would probably be “the worst in 25 years, much worse than the mild recessions of 1991 and 2001, which most people remember as typical recessions.”
Wall Street and the Federal Reserve said otherwise. Until just a couple of months ago the majority of economists, and the Federal Reserve,…
21Oct2008 | Street Smart Report | Comments Off | ContinuedStock market looks to “favorable season” rally
Secular bear market trend to hold sway for years.
For the most part I have been on the right side of the market again this year, in for the rally off the March low, in short-sale positions for the subsequent next leg down to the July low, currently primarily in cash with only a couple of downside positions. So I’m up some for the year, while the S&P 500 is down 24%, and foreign markets have lost even more.
All year long I have also been predicting that beyond the rallies and pullbacks, the market would not see its low for the year…
6Oct2008 | Street Smart Report | Comments Off | ContinuedBEING STREET SMART
Will they never learn? Financial firms get greedy. Regulators make rules. Congress passes laws. Markets hand back unintended consequences. Over, and over, and over again.
What is going on now is not new.
Two hundred years ago Thomas Jefferson said, “I believe that banking institutions are more dangerous to our liberties than standing armies.â€
One hundred years ago Henry Ford said, “It is well the people of the nation do not understand our banking and monetary system, for if they did I believe there would be a revolution tomorrow morning.â€
Over the years, and as a result of previous financial debacles, a few…
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