Do you hear that? I hear a few different things. First, I hear a rushing sound, like money rushing into the markets. It is a tidal wave and it has been waiting on the side-lines, just waiting, for the moment to rush in. And now the wave seems to be coming ashore big time. Markets were aflush with a rush of money today. A bit of good news on EU banks and the flood gates were opened to the money rushing into the markets. Now, I must admit, there is not a lot of difference in the sound between the money rushing in and it flushing out. One seems to follow the other. We will see.
The other thing I hear is silence. Silence in terms of anything positive happening in housing, foreclosures, commercial real estate, unemployment, inventories, exports, GDP growth, etc., etc. For this stage in a recovery the numbers on all these are still sucking wind and some are clearly signalling a double-dip. This is certainly not a consumer led recovery as they are still lacking confidence, lacking jobs and buried in debt. It is not a housing led recovery as many respected - and generally correct folks - are expecting prices to continue dropping this year with sales to be very poor. So what will lead this economy out of recession? China- well it did for a while and now is having its own problems with its economic indicators the worst in 17 months. EU ain't going there. Thus, I hear only silence in terms of positive news that may lead us out of this recession. If you hear something different, I am all ears.
Don't believe me as I am an attorney and we always lie, or at least most folks believe we do, here are some links supporting the above:
Residential real estate still sucking wind: http://www.calculatedriskblog.com/2010/08/private-construction-spending-declines.html
http://www.nakedcapitalism.com/2010/08/new-push-to-prop-up-housing-market-via-mass-refis.html
Commercial real estate ugly: http://www.nakedcapitalism.com/2010/08/getting-ugly-on-the-commercial-real-estate-front.html
Disclosures: None.
Thursday: Unemployment Claims, Trade Deficit
3 hours ago
2 comments:
You know, Craig, I think it would be fun to sit down with you and some of your other readers and enjoy a few beers. I chuckled at your "sound of money rushing into the market". Are you sure it wasn't shorts rushing to cover after the market held 1100. Who knows. I really couldn't care less which way the market moves. I just want to be on the right side...long or short...and I don't care which. So I wake up each morning, peruse Bloomberg, read a few other sources, wait for the early craziness to pass (say around 9:30) then put about 5% of my cash to work on my best guess of the day's direction. Sometimes I win, sometimes I lose, but overall I'm having fun and collecting a few shekels while most of my cash sits. One of these days, Mr. Market will clearly decide which way it wants to go, and I'll hop on big time.
He is fun to have a beer with.
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