From: J. van Baardwijk
> From what I read and hear, the economic boom in the US is almost history
> already. Stock markets around the world react quickly to economic news
from
> the US; only last Friday stock prices went down when the latest
> unemployment figures from the US were announced. Over the last months,
many
> funds on the stock market (particularly companies in the high-tech sector)
> have seen a dramatic drop in value. Recently, prices dropped so fast in
> only a few days on the Dutch stock market that experts called it a "mini
> crash". Most funds are still recovering from that event.
>
> To me, all this indicates that the next recession (complete with stock
> market crash) is near. Personally, I expect it to happen within two years.
> But that's just my non-expert opinion, of course.
Yes non-expert would be the best way to define it because the last two
Friday's have seen a RISE in the DOW average. The average dropped May 4th
after the unemployment figures first came out but they quickly rallied.
(Which was a surprise to experts. But the whole economic boom/bust relates
to the environment: bad news sells.)
If you were talking about the few markets that were open when the
unemployment figures where announced, I can't find their charts. But you
have to know that 'the markets' are just another business tool, and all of
those brokers are trying to make money. Since they knew the unemployment
figures were coming out at 9:20 am EST (just guessing about the time) then
millions of people had one finger on a sell button and one on a buy button
depending on what the news was.
When the 'smarter' people decided that bad news would prompt the government
to again decrease interest rates, they started buying stocks that they
figure would benefit from the rate reduction.
A lot of 'experts' believe the whole US stock downturn was because the Feds
raised the interest rates too much too fast. Business stop borrowing money,
stop buying 'things' and everything cooled.
A lot of high tech stocks were over valued and while the idea of the 'new
economy' was appealing (owning stocks to sell later, not owning stocks for
their return value) it's not what stocks were made for and the old economy
is again coming to the forefront.
Let's keep the economic forecasting to other boards.
Kevin Tarr
Trump high, lead low
