why will market surge tomorrow?
do you really think GM BK is good news?
let's have one good answer other than "it's been going up for weeks" trend argument. Give it to me....
Answer to all your quesitons is: Capitulation on behalf of the shorts.
Their hands are up in the air. They give up. They will buy at market tomrorow to get out of their short positions.
I am not a market pumper and I for one hope that we do not go up when the stalwart of the American Economic System goes bankrupt. IMO, if we are up tomorrow it does not bode well for the future. It is just another indication that people are looking at this through rose colored glasses and not taking into account the true consequences of these actions. IMO that will come back to haunt us in a big way. The more this market is propped po by false hope, the harder the fall will be when that hope is not backed up by reality. I would feel much more comfortable with some pullback before we continue the move higher particularly on a day like tomorrow when a pullback is exactly what is warranted. Again IMO if that does not happen the rug is going to be pulled out at some point and down we will come with a crash. That will not be good for any of us period!! GLTA
Stocks are extremely cheap and the squeeze in the credit markets is continuing. In fact, corporations are issuing a record amount of debt. This pushes their inevitable bankruptcy into the future, and maybe not at all if there's enough inflation. That makes common worth more.
Plus, there is ZERO pressure in labor markets. That means corporations don't have to pay their workers more and margins are huge, so inflation is very good for profits.
Great post. Basic economics at work here. Companies have jettisoned the dead ballast and they are leaner and meaner poised for growth. Americans have been tightening their belts for months now, savings have increased and personal debt has been reduced. Stimulus effects will just be started to be seen in July and August.
And trillions of cash on the sidelines just waiting for signs of a recovery to get back in the market.
Why would anyone NOT want to be long right now?
yes...but that argument is only a timing argument as you reference "inevitable bankrupty." Knowing that you can't time the market long or short, haven't you made the case for banks stocks being much lower than they are now at some point in the future and during this recession/depression?
I am baffled as well. Futures up, all these news org's calling for a market rally to continue this week, with GM news not important. more not as shi t ty as expected news, which will drive market up.