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Sunday, December 2, 2007

Which way the Omnisicent Market?

The stock market used to be a leading indicator. The Conference Board still carries it on their web site.
Now it is not even a coincident indicator, as stocks, bonds and commodities steam on through the cracking US economy.

The analysts are babbling. Stocks are going up on bad news and down on good news, then changing around the next day. Different economic dynamics are being produced every single day by talking heads who are in a gravity free environment. The Fed's rate cuts are not any kind of good news for 12-18 months, EXCEPT FOR THE FINANCIAL SECTOR floating again on cheap money. It's not going to help anybody except the banks. And the pundits who need a reason for today's turnaround.

In fact, analysts and commentators (aside from this one, please note) have been trying to sell us the bear market for months. "It is official," was the banner three days ago, before the bounce hit 500+ points in two days.

Make no mistake, markets see the recession coming. They see the falling dollar. They just don't care. Because the purchase side of the market has nowhere else to go.

Now the rest of the story. On another scale, the value of the market in euros is down down down. The value of the market in petrodollars is down down down.

But the core of the story is that analysts are looking for value and performance possibilities in the market, and seeing none, they don't know anything else to do but predict that yesterday's movement will become the trend.

You can actually learn more about what they don't say than what they do.

Nobody talks about the market signaling a recession any more.

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