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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?


To: SouthFloridaGuy who wrote (76507)3/19/2008 6:09:46 PM
From: estatemakr  Read Replies (2) | Respond to of 116555
 
Want some Spring cleaning/yardwork done? Want your house painted? Want to build that garage out back?? Lots of hungry contractors out there taking work for cheap...atleast much more cheaply than a year ago.......deflation, deflation.....



To: SouthFloridaGuy who wrote (76507)3/19/2008 6:10:21 PM
From: stockfiend  Respond to of 116555
 
Precursor of an event does not equal an event

Examples:

When a stock spikes the day before earnings but earnings miss expectations.

When options predict that bad news is about to hit a stock but the bad news never comes.

When a currency drops in expectation of a bad inflation print but the print is in-line.

In other words, people are placing their bets in the market based on their expectation and prediction of things to come. The sheer volume of those bets do not equate to the probability that the event will happen. On the contrary...