good idea..the component cos. will also sit on mountains of bad loans and massive derivative losses once the LLCF and the recession hit, and losses, especially huge losses, are bullish, because implicit in them is that they will be smaller in the future, thus enabling us to raise expectations as soon as they occur. even if there are indications that they will become even greater losses eventually, in terms of this theory that's even more bullish, as it will be easier in the future to raise expectations. also expectations for greater losses may well lead to higher stock prices in the wake of losses beating expectations.
if you're still with me thus far, you are close to understanding current bull market logic. as can be seen, by extension recessions, and depressions even more so, are inherently bullish. faltering growth is generally bullish as it raises hopes of rising growth at a later stage. a depression may add the additional fillip of massive bail-outs, financed by j6p's tax money and Al's printing press, all of which is bullish as it amounts to free money that can afterwards be lost again with impunity, re-starting the cycle of at first lowered, and then easy-to-raise expectations, that can be exceeded or missed by actual results as occasion demands. in fact this is an unimportant detail, as misses can always be balanced by hopeful press releases and/or conference calls as well in the case of financials be spiced up a bit with cries of systemic risk in order to facilitate aforementioned bail-outs.
it's a no-lose no-brainer...the worse things get, they better they get actually, at least for the dedicated leveraged gambler. needless to say if things don't get from bad to worse, a different, slightly less tortured logic can be employed to justify forever rising stock prices. |
