The Epic American Credit and Bond Bubble Laboratory Message Board

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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory

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To: russwinter who wrote (67001)	7/28/2006 3:06:47 PM
From: Mike Johnston	Read Replies (1) of 110194

financial markets love train wrecks, either that or totally fail to recognize one? It is all about liquidity. When a lot of bad news hits, like the other day when many consumer stocks blew up, that is exactly the time when the Fed turns the spigots wide open. Who knows, if 400 stocks in the SP500 blew up all in one day and all gapped down 10%, then the remaining 100 would enjoy a huge explosion to the upside since massive liquidity boost would keep the index unchanged and all the money would flow to those 100 stocks.

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