Because fear is leaving the market. We've had a quick pullback from a quick run-up.
Some more positive news for market longs:
1) It looks like the Irish Banking system will be backstopped/bailed out by EU.
2) Recent data suggests that inflation remains dangerously low, supporting the Fed's decision for QE2 and suggesting that hyper-inflation is not on the radar.
3) The GM IPO is looking very good. High demand and good PR for 'Govt. Motors.' Also good PR for govt; see Warren Buffet's op-ed in NYTimes today.
4) M&A activity picking up. Lots of cash on books and even more now with QE2.
Combine this recent info with a generally bullish market trend in an historically bullish calendar period, and you've got some gas in the tank. If retail sales are superstrong this season, we could really take off this winter and finally get the market back to picking winners and losers, rather than selling or buying the entire market -- i.e., back to market efficiency.
Because fear is leaving the market. - Because they want Joe Retail trader to believe so.
1) It looks like the Irish Banking system will be backstopped/bailed out by EU. - If things are so great then why are bailouts continuing?
2) Recent data suggests that inflation remains dangerously low, supporting the Fed's decision for QE2 - The shear abundance of debt is squashing artificial inflation. Artifical inflation is under heavy critique and won't continue much longer.
3) The GM IPO - Over priced junk.
4) Lots of cash on books - Lots of debt also. Look at both sides of the balance sheet, not just one side. Why do you think companies are holding onto lots of cash. Incase the debtors come a knocking?