Jim Hawthorne

Why It's Time to Be Invested in the New Recession

Neighbor! Hi!
Main point concerns the recession issue.
I hold no strong brief for either party's platform in the upcoming November derby... We trade and prosper in spite of the politicians... not because of them! Tax plans come and go, and can be changed at the drop of a hat, as we well know.
In my opinion (and that's all it is), the pickle we are in at the moment has a lot to do with several decades of fiscal irresponsibility of one form or another.
We're where we are because of low rates, easy credit and a huge oversupply of $$$... (see the M3 estimates which the Fed in its wisdom no longer publishes).
There is lots of blame to go around, and while the roots lie back in the late 80's/90's, the current administration has exhibited a retreat from traditional Republican fiscal responsibility; a tradition I strongly support.
Thanks to the tax cuts we might just be making a few more dollars, but at the rate we're going, it will take a wheelbarrow-load of them to buy a coffee and a danish anywhere outside of the US! In real terms, are we better off now that we were in the 1980's???
Anyway, what was it that pundit said back in the 60's... "All governments are run by crooks and liars, and you should never believe a word they say"... or words to that effect.

Why It's Time to Be Invested in the New Recession

There is no doubt that "Investor Sentiment" is very important... But let's remember that "sentiments" do not just fall out of the sky; they are grounded in perceived conditions, which in turn, are driven by conditions in the real world. Sooner rather than later, perceptions must become aligned with reality.
While it may be possible to talk ourselves into fearful profit-taking or over-optimistic dip-buying, it is ridiculous to say we can "Talk ourselves into a recession". Anyone making such a claim either has no idea what "recession" means or is desperately struggling to raise the tide by sheer force of will.
A note to htroute66; you might wish to display your own grasp of economics with a more reasoned analysis of government spending and fiscal policy over the past 7 years!

Markets Bounce Back From Bear Stearns Panic; Is the Worst Over?

Sure, we closed last week with the S&P up 4.2%; but almost all that gain was on the single day 4/1/08, which granted, was spectacular. Since then positive volume appears to have dried up, and the S&P is struggling to hold onto its gains.
I agree that there is strong evidence that we are experiencing one of those violent bull rallies in the context of a broader bear market, and that the bull case has yet to be substantiated.
We live in interesting times...