Take that GM!
Markets are leading indicators. Right now, their telling us that the shit has hit the fan. I haven't read anything yet today, but if the markets are any indication, we really are in a lot of trouble. Here are a few numbers that I think are significant; the 90-day bill is trading at at .02% yield (that's 2/10's of one percent, more buyers than sellers?) oil closed at less than $50/barrel (the Brent crude contract was at $47.47). Last spring, oil was trading at $140 plus. The Dow closed at 7,552 a drop of greater than 5% on the day and, if memory serves, it's been less than one year since it set a record at 14,000 plus. So the drop in the Dow is close to 50% from its highs.
So, is it a correction or is it all based on proper valuation - which takes a correction in order to occur. There can be absolutely no doubt, that all markets were way overdone. When that happens, there is always a correction. So, are we there yet? Is it time to buy? Where will we be in six months? One thing is certain, there was rampant speculation in a few markets - commodities and real estate for sure but probably some others as well.
What's in a name anyhow? I'm thinking correction. The markets were overdone and now their not. I suppose that there is value out there someplace, but who really has the nerve to step up to the plate? Anybody, and if there isn't anybody, will it deflate some more?
1 comment:
yep, that was the bottom. good times will return
with my man Obama! so cheer up already.
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