Market Direction

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05-25-2016,
beacpird44

Market Direction

I would just like to give my two cents and comment on a few things.

It seems as though the past rally has left a lot of us baffled on where the market wants to go. We know that the market is designed to go up. The typical mom and pop investors/retirement accounts are not long/short funds or short at all. There are rules in play (such as the uptick rule) that add stipulations to selling short and well as naked short selling. Some brokers will not allow shorts etc, you get my drift. With this being said, there was a lot of news that was exaggerated both good and bad in 2008 in order to find a bottom. I feel like the general consensus now is that people are trying to exaggerate good news and shrug off bad news. There was one key factor that was missing back then that we have now, optimism.

We all knew things were going to be bad in 2008, the media did a lot to add as a catalyst to that state of mind, but we all saw the weakness and exposure that many companies were having. It was was obvious things were going to be rough after lehmen virtually disappeared overnight and Bear Sterns was allowed to fail. It was in our favor to be short because we saw little effort to effectively tackle the problem. When Congress failed to pass the first version of the stimulus bill that sent the markets plummeting in November, a lot of people I knew had zero optimism after that point. A few trillion dollars later, as well as earnings reports that are manipulated to look good through accounting laws (m2m), optimism has returned to the market in hopes that things will get better quickly. A lot of investors have began dipping their toes into the market out of optimism.
05-26-2016,
Bennierge

tim - i think you've captured the same sentiment i had for a while now. i don't trust for one minute all the rosy news from the banks. how can we possibly go from a state of "we're at the brink of total collapse" to relatively good earnings in such a short time? as an investor and a citizen, i personally feel manipulated by both the government and these companies. there is great incentive to report positive news right now, and i think you've hit the nail on the head as far as them being overly optimistic... because there is so much to gain.
05-28-2016,
BlaineTarr

This is a little blurb saying banks may need $1 Trillion after the stress tests.
http://www.bloomberg.com/apps/news?p...Q_g&refer=home
But KBW's analysis may be harsher than the governments. It wouldn't be surprising if the stress tests were sugarcoated with BS and CNBC reports on the "surprisingly" good results. Gotta wait and see.

Anyone have a theory on why they are delaying releasing these results?? My understanding is they've had the results for awhile and are just waiting to release them.
05-28-2016,
bertadm1

Become one with the govament and trade like the govament grasshoppers.
05-30-2016,
BlancheDie

I believe the Government wants to obfuscate any bad information right now, and over-emphasize any good information. Even if the stress tests come back bad across the board, I am 99.99% sure they will find a way to spin it to sound good. If a bank can't make money when they are lent free money, they should demolish their buildings and blame martians for their problems.

This rally is a government inspired rally, and will continue to do so until people begin to forget about the fragility of banks, and start looking at individual stocks earnings/financials more closely. ADD is prevalent in society and will soon show it's head.