It’s never time to panic. That is certainly doubly true when it comes to investing. But it takes a disciplined mind to avoid freaking out as shares continue to march lower day after day. And in the midst of the chaos to make wise decisions.
In the attached article from CNBC the point is made that the real bubble is likely an inflated confidence in the Federal Reserve.That come what may, the Fed will intervene in markets and buoy them. So what if stocks are over extended, Yellen and the FOMC will save the banker’s posteriors. As we’ve said before this sounds very much like “housing prices always go up” to us. If sentiment regarding the Fed were to change, if traders were to fear that things were bigger than the Fed, a downdraft could be wicked.
We’ll see. There’ve been many blips over the past 5 years and for the most part the pro-Fed folks have been right as far as equity prices are concerned. (Little else.) Maybe this is just another blip on the way to Dow 20,000 and beyond.
But maybe not.
Interesting things happening in the markets. We’ve had a dozen or so of these flare ups over the last few years so we’ll see how this one goes. But it’s definitely one of those times where brokers aren’t going on vacation.
Take this with a grain of salt, but it is an interesting chart for sure.
The economic tide has been going out for quite a while, but the pace has just quickened in emerging markets – big time. Things have become quite unsteady and no one knows whether the current instability will trigger something broader in the developed economies. China is slowing. Japan has horns locked with China economically and increasingly politically. Europe is catching its breath before another wave rolls through.
Ben told us today that he’s not ready to stop rocking the QE just yet. The stock market celebrated. More manna from the Fed! Hurrah!
Now sing it with me – “Ain’t no party like a Bernanke party, ’cause a Bernanke party don’t stop!”
Ah yes it’s good to drink from the punch bowl.
The markets are getting squirrellier than 2000 Mustang GT on an oiled up track. By which I mean very squirrelly.
Art Cashin the dean of the NYSE floor stopped short of saying that out and out manipulation was happening in Japanese after markets trading.