beacpird44
05-25-2016,
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.
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.