WooHoo; recession over!!

[clifp]

Quote:

Originally Posted by FIREdreamer what happened y'all? Oh wait a minute. It's time to take my chill pill with a tall glass of water. Ah. Let's see now. Nop, fundamentally nothing's changed. Looks like a bear rally to me. They're gonna keep shaking that tree until all the money comes out. Better hold on!

You certainly maybe right that is a bear rally. However, you are wrong about it not changing things fundamentally.

A .75 Basis point cut has dropped the cost of goods for every bank in America by 16% (4.25-3.5). Banks can either keep the difference and increase profit margin (net interest) or lower rates and encourage borrowing, either result as good as long as the avoid loaning lots of money to people with lousy credits at very low rates. Judging from some the post around here banks seem to be a lot more careful about lending.

It is equivalent of OPEC announcing that tomorrow the price of oil will drop from $90 to $75/barrel, and Airbus and Boeing both annoouncing a buy 5 jets get 1 free promotion. This may not change the fundamental structural problems of the airlines, but for the short and intermediate term it is really good for their profits.

[barbarus]

Quote:

Originally Posted by clifp It is equivalent of OPEC announcing that tomorrow the price of oil will drop from $90 to $75/barrel, and Airbus and Boeing both annoouncing a buy 5 jets get 1 free promotion. This may not change the fundamental structural problems of the airlines, but for the short and intermediate term it is really good for their profits.

A drop in crude prices would be of great benefit to our economy. These Fed cuts are going to be disastrous for all but a few powerful institutions.

[clifp]

Quote:

Originally Posted by barbarus A drop in crude prices would be of great benefit to our economy. These Fed cuts are going to be disastrous for all but a few powerful institutions.

Why?

[FIREd]

Quote:

Originally Posted by clifp You certainly maybe right that is a bear rally. However, you are wrong about it not changing things fundamentally.

I don't understand. Are you saying that today's rally has fundamentally changed anything? What did that rally change, please enlighten me.

You obviously know better than I do.

[clifp]

No the rally didn't change anything the rate cut did, I guess I wasn't clear. The rate cut has fundamentally increased the short and intermediate profitable of banks, who are the most trouble sectored of the economy. The rate cut caused the rally that is all I am saying, I think you were implying that the rally was irrational.

[megacorp-firee]

Quote:

Originally Posted by HFWR You say that like it's a bad thing... "And his brothers, Black and Red..."

try blue if the market goes high enough you get a chance.

[TeeRuh]

Quote:

Originally Posted by megacorp-firee try blue ...

That's what's so cool about JW; things are bad, go red; pretty good, go black; really, really, really good, go blue!

(Of course there is a JD route of green and black that cover the first two steps.) (Or should we be talkin' about the 12 steps ...)

t.r.

[cashflo2u2]

Wait until they revise that last jobs report upward substantially, and it will be "R" for Rally mode.

[TeeRuh]

This mornings update:

08:31 ET Dow , Nasdaq , S&P : [BRIEFING.COM] S&P futures vs fair value: +7.6. Nasdaq futures vs fair value: +26.8. Stock futures continue to point to a higher start. The majority of earnings reports from last night and this morning have been better than or inline with expectations.

For those of you who realize how powerful my ability to call the end of the recession was I thought I'd let you know that I am available for speaking engagements at a very nominal fee ...

t.r.