Yesterday May 4th was another foray into the unreal. The market ended the day up over 200 points. Wells Fargo was singled out as likely needing more capital along with Citi and B of A and lo and behold, their stock shot up over 20%. I must say I am glad I sat that one out as I would have probably been short.
Momentum is clearly to the upside, even though it really does not make much sense. We keep hearing from the financial media that the "fundamentals" are looking better. Can someone please explain that to me? We are losing 600K jobs a month, corporate profits are being eviscerated, and the real estate market although it has taken a breather, shows no sign of picking up anytime soon. Yes I understand the the "market" is forward looking and usually will be a leading indicator coming out of a recession, but what if it is wrong? What if this is nothing but a massive bear market bounce? History suggests it is just as likely that as anything else. Anyway, as a small retail investor I am still very gun-shy about jumping back in. I would love to hear from some other small guys or gals.
Tags: Stocks Bonds Stock Market
