Sergio, I think some of the problems built into the system by cheap money will also not be solved by throwing more money at those same problems.
Just look at Japan, which as you said is in the toilet, stock wise, they have for years tried to get their citizens to be spenders, even a zero borrow rate, and it hasn't worked. They happen to like to save. Maybe they still remember the tough times post WWII. Obviously younger US citizens have a different point of reference, or more likely, none at all.
The $3 trillion dollar question is what happens if US consumers do the same? As I have said before, how much crap can people buy before they give up?
As for Europe, good luck. I was recently in Ireland, and real estate prices are starting to crash, which is nice if you want to buy, not so nice if you paid top of the market to get in. It has something to do with hi-tech going bust, thus popping the bubble.
Argentina/Brazil are more examples of throwing good $$ into a very black, very deep hole. Exactley what is the point?
Today's GDP report wasn't all that bad. It was actually better than anticipated, but Japan's negative news ruined any possibility of a rally.
I disagree, that report today was bad, real bad. It is almost to the point that they can't spin it anymore. People are perhaps just a bit smarter now that they are losing money in the stock market poker game. Fool me once.....
On that note take a look at what SUNW had to say after the close. I think that may be a real drag on the market the next day or so... |
