LoF,
As Poet said the true value of a market is where the market itself determines. (and for now, while undecided, it seems it still has a downward bias).
We need to define wy we are here, investors, or traders/speculators.
As investors, the view can be extended a little bit, but without ignoring the realities of the market. i.e. The buy and hold strategy is dead, we live in too an intertwined world where the differences between extremes are huge and whether we like it or not, they will affect our markets.
As traders/speculators, we can only accept the truth that the market gives us. Precisely because the markets at times are psychotics it is too risky to try to guess them, we must play according to whatever trend it may be, as exaggerated or illogical as it may look.
Fundamentally there are certain dark clouds in the horizon that may pressure the companies for a while and their performance may suffer.
If we were to view the US economy with an isolationist's view, one would say that we need lower rates, but it can not be viewed that way. AG is in effect the central banker for the world, if he cuts rates with abandon, it can create havoc amongst other weaker currencies and reinforce that the US dollar and assets as the only "safe heaven" and possibly going back to the "bubble" days.
Many of the debt that the Telco companies have incurred in have to do with developing networks in other countries. If the economies of those countries falter... such debt will not be serviced.
In short, I do not think that it is that easy and simple, to just cut rates and end of story....
I believe a healthy dose of fear in these markets is needed in order to be more careful where assets are allocated. In the end what matters is who is making money TODAY as opposed to the "possibility" of making money tomorrow.
One think that culd prove a short term positive is if Congress passes a law allowing to allocate part of the Social Security funds to equities...
That would be a case of demand exceeding supply (of equities)
P.s. as I am ending this I see qcom jumping... let's see if it lasts.... |
