The US stock markets is depressed. The economy is in trouble and inflation is high. Incomes have dropped and cost of living is high.
Against this backdrop, the US stock market rebounded last night. The investors bought shares because of a small dip in the bond yields.The real reason, TKL suspects, is that there is too much money lying around. The US govt printed a lot of money. The money has to be invested somewhere.
Many investors are waiting to buy stocks at depressed prices. There is an oversupply of money that needs to be invested.
What will happen from here? Nobody knows. It could be a "dead cat bounce" and the stock market will plummet again. It could also be a recovery.
My financial crystal ball ECB is also confused. He said - Boss, the stock market may crash, but may also recover.
What kind of rubbish expert is ECB?
Tan Kin Lian
2 comments:
In 2008, panic in the financial markets. Banks caved in and had to be nursed back with tax
dollars. Investors, politicians and journalists probed for the root of the crises.
Greenspan's monetary policy or the stupidity of the investors? The dubious rating agencies,
the corrupt auditors, a bad risk model or just pure greed? Was it one cause or everyone of
the cause?
On 31st January 2006, Google announced its financial results for the final quarter of 2005.
Revenue up 97%. Net profit up 82%. A record-breaking quarter. How did the stock market
react to these figures? In seconds, shares tumbled 16%. Shares were interrupted. After
resuming, the stocks plunged again. What had gone wrong? Analysts were predicting even
better results, but billions were slashed off. Now even investors cannot forecast results
accurately. Nobody can, otherwise everybody would be rich just playing the stock market?
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