March
2009
Be optimistic but not with your money5
Seems like after after 5 sessions of the stock market rally, the bulls are back to play, and you can’t turn anywhere without someone telling you that if you don’t buy now, you’ll miss the boat.
Just 2weeks back, all major news sources were still busy tripping over themselves trying to come up with a more dramatic comparison for what this recession is equivalent to. Consensus then seem to be that this one is worse than all previous recessions with the exception of the great depression.
So what has changed in the last 2 weeks for everyone to be so compulsively optimistic? Nothing.
As far as the I can see, banks are not suddenly opening their vaults, what’s left of it, to borrowers. No one as yet has implemented a way to take toxic assets off the banks books with further pain. Property prices are still 50%-100% higher than at the start of the last bull cycle. And manufacturers are still firing.
I have no doubt that we’re a lot closer to the end of the bear market now than we were 6 months ago, and people now are more focused on solving the issues now than they were then, when everyone was running around in a daze.
But really this rally looks to me like it’s driven more from greed than any sort of excessive optimism in the world.
