The US stock market is enjoying one of those delightful episodes when all news is good news. The Dow Jones Industrial Average jumped 221 points yesterday to 8,721 – lifting the Blue Chip index to within a whisker of a positive year-to-date performance.
The toxic tentacles of recession seem to extend into every imaginable – and unimaginable – pocket of the economy. As these tentacles release their toxins, the resulting distress affects both individuals and industries alike, often in ways we might not have imagined in advance. But so too do recessions impart the occasional surprising benefit. Our advice: Enjoy the benefits when and where you can because this recession is likely to get much worse before it gets better.
Markets slip again on weak housing data, economic outlook, Greenspan speaks: what the great contrarian indicator had to say this time, and plenty more…
What this leading indicator for gold is telling us right now… Five specific precious metal plays for you to consider…Three gov’t mandates that could force you to make $63,359 and more…
While American stocks stumble, Shanghai soars… why Chinese equities are bucking the global trend… More data disasters… ADP jobs report, auto sales register scary declines…Tired of shaking down U.S. taxpayers, GM aims abroad… EU begged for Detroit dollars…Obama, Bernanke talk up Uncle Sam’s book… Eric Fry on how rampant inflation still seems inevitable…Chuck Butler takes a stab at the $10 trillion question: “How long will this dollar strength last?”
Nations do not purchase their prosperity, says Eric Fry. Since this crisis started last year, the government has thrown around $8 trillion at the problem. But these are banknotes that it has manufactured for itself. And that’s why we may soon face a severe threat from inflation.
When the Treasury finally abandons its bailout programs and/or the executives at the cash-hemorrhaging finance companies finally exhibit more humility than chutzpah, the economy and the stock market will have reached the bottom.
Investors are now prepared to believe that politicians can ‘fix’ the economy after Wall Street’s recent bout of hari kari. So is it now time to get back into the markets? The answer depends on whether your prepared to brave the elements or not. Eric Fry says if you do, you should consider this one simple investing strategy.
No, you didn’t read that headline wrong. According to Forbes.com, the $700 billion price tag on Hank Paulson’s bailout plan for the US financial markets wasn’t based on “any specific data point.” It just seemed like a nice big number. This from Forbes, Tuesday:
In fact, some of the most basic details, including the $700 billion figure Treasury would use to buy up bad debt, are fuzzy.
“It’s not based on any particular data point,” a Treasury spokeswoman told Forbes.com Tuesday. “We just wanted to choose a really large number.”
– There really must be a financial crisis. John “the fundamentals of our economy are strong” McCain has suspended his presidential campaign to to return to Washington to work on the proposed $700 billion bailout bill of financial institutions before Congress.
– Meanwhile, McCain’s fellow Republican George W. Bush made a televised appeal for the swift passage the plan. He said the “entire economy is in danger” and warned of a “financial panic” and “a long and painful recession” if Congress didn’t pass the bill soon.