there was no good reason for the selloff today. Inflation good for economy & stocks market. rising long term yields DEBUNKS the deflationary spiral so many had feared 3 months ago we should recover all of today's losses later this week
For now, I'm bullish BUT We are severely overbought GM is on the verge of BK Kim Jong Il is playing with nukes Rising oil prices will hamper growth Rising interest rates won't aid home sales Etc So, why don't you justify why you are bullish.
Perceived inflationary pressures (e.g. crude oil, gold, and yields on the 10 year Treasury) = bad for stock market http://thetechnicaltakedotcom.blogspot.com/2009/05/inflation-expectations-to-pressure.html
The quote above is the audible equivalent of a Walrus farting onto the sun-warmed rocks upon which it lay.
I would call it a dearth circle. Rising yields put pressure on borrowers (consumers, producers, etc) -> Economy slows down -> Stock market falls -> Yields drop -> Signs of recovery appear -> Stock market rises -> Yields rise (see the beginning) That's the circle. Isn't it? While in the early stages of economic expansion each borrowed dollar produces added value of more than 1 dollar, nowadays each borrowed dollar produces MUCH less than a dollar of additional value. The reason is simple - expansion has it's limits while borrowing hates limits - that's the main reason this death circle came to existence. There is no escape unfortunately.
1974 and 1982 inflation induced bear markets were brief. The 1973-74 bear market lasted just a 18 months despite the infamous gas lines. Since 2002 commodities, economic growth, gas prices, and stocks have risen in lockstep. We can infer that inflation is good for stocks or is indicative of economic growth. http://finance.yahoo.com/q/bc?t=my&s=^DJC&l=on&z=m&q=l&c=spy