I know that there's speculation that the sub-prime crisis may be ending but with gas prices as high as they are and the number of jobs being lost, why isn't the market turning down? Before you flame please understand that I'm really curious. I'm thinking of getting completely out of the market and don't know if I should pull the trigger or not. I don't see how it's not turning given that the future seems wrought with a weak dollar and high oil/gas prices and a weak job market. All that on top of the lingering damage from the sub-prime mess. I feel like I've got to be missing something since the market seems to be hopeful. Any insights are appreciated. I just don't want to see my savings fall 50% again like a few years ago. Thanks, MPO
Remember the news will always be worst when the market has already rallied off the bottom for some time. Doesn't mean that we've seen the bottom already at this particular point in time, but just how it works out generally.
It's going to be interesting to see how the market reacts to CSCO & Disney's earnings. T http://actionpointsta.blogspot.com/
It's the index futures man, the big houses run the index futures up and down with ease. Gap open the cash, stocks get a free mark up at the open thanks to the futures. Watch the overnight session you will see the high or low for the next day in the futures. Index futures to perfect tool for manipulation.
The future is not wrought with weak dollar and high gas prices, that is the present right now. Remember the market overall prices in future expectations. What happens now has already been discounted in and led to many of the strong sell-offs since Oct highs. The market is looking ahead to second half of 2008 and 2009 for the most part and will continue to do so unless some shocking news or fundamental shift comes to show that it will actually be worse than it is now. Usually large job cuts and bad earnings reports are what comes out when the worst is factored in. As someone else said, the market usually turns when it is as the assumed worst because it is assumed the worst is over and behind and they are pricing in future movements. Whether the market is right is another story but lack of more bad news and horrible earnings leads many to get back in for the long haul until something changes. Whether we agree now is the right time or the bottom is not yet in is not for us to decide but the majority of the market players.
The rally started this morning when folks started jumping on the cheap dollar. I think the rally will strengthen at some point in the next couple of weeks as more fuzzy foreigners come in to buy it. T http://actionpointsta.blogspot.com/
earnings ultimately determine the value of a stock and the market overall. the earnings aren't down as much as everyone thought they would be several months ago. the weak dollar is actually helping companies that export. i did hear one person on cnbc say that earnings of energy companies will account for 20% of s&p 500 earnings this quarter. that is something to think about. it doesn't really look like the economy will actually end up in a recession now. that could change.