First it was a complete throttling of the markets, which had basically every bull scared for their lives. Suddenly there were no more bulls and the markets have since rocketed; however, lets not get naive.
What has been fixed? What situations have been eased? Has anything been done at all? To my knowledge, it seems like only bad news has been leaking out.
If this is the case, then what is to account for this recent run-up we have experienced?
While these days perception rules the markets rather than actual data and facts, it is indeed possible for markets to experience these brief rallies every now and then. Brief is the keyword. People can lie as many times as they want, but eventually it catches up to them. Perception can only move the market for so long. Eventually reality sinks in.
With the holiday season upon us, many traders and companies are trying to set all the problems aside. Whether it be freezing foreclosures for a couple months or whatever, these rallies will not last. While these problems are being set to the side, they are not getting better. If anything, they are probably getting worse.
Just because Americans are embracing the fact they have no money, what does that really solve? Many of these Americans may be unemployed, so they were not spending anyways. If nobody is spending, then how are companies getting better?
Last time I checked everybody in the auto industry is yelling for a bailout of their own. As long as they can produce a sound plan, the Government has expressed the money is there.
Where is all this money come from. It does not just grow off trees. Somebody has to pay for it, and it will most likely be you and me.
So while the holiday season is here and moods have lightened up, lets enjoy what we have now but do not dupe yourself into thinking things have gotten better. Housing prices are still going down, more companies are being bailed out, and gas prices are bound to get higher again.
No need to watch How the Grinch Stole Christmas this year, just watch the news.