longweekend58 wrote on Aug 9
th, 2011 at 5:04pm:
so looks like disaster has been averted. I guess pansi and toenail will be very disappointed.
Do you think so?
Apparently, you may not have heard the expression, "buy on the rumour & sell on the fact"?
That's what happened in the US on Friday, with rumours!
First, there were "unsubstantiated rumours" that S&P were going to downgrade the market (read US Credit rating) after the close and that was enough to send the market down by 240 points.
Then, there was then another rumour that the ECB was going to "give" Spain & Italy money" and that moved the market up by 120 points.
What makes these comments more interesting, from the perspective of what happenned on Monday, is that the S&P rumour turned out to be a fact & the ECB rumour of "giving" more money to Italy & Spain, did not turn out to be correct, at least at this point AND THE DOW THEN LOST 635 POINTS ON MONDAY!
Buy on the rumour, sell on the fact?
So, today there is a rumour that the FED Reserve will again step in and again, markets have gained.
http://www.bloomberg.com/news/2011-08-08/bernanke-may-move-to-lift-confidence-on...Well, the Truth is, there are some things that reserve banks, such as the FED can do & some that they can't.
On this ocassion, at this point in proceedings, there is little (if anything) that the FED can actually do that will make any material difference, owing to the trend of the major Economic factors line up against it, such as -
1) Demographics (Baby Boomer Ageing & soon to be, dwindling Global Population)
2) Peak Energy & Related Pricing issues
3) Peak Global Debt
4) Climate Change & Related issues
But, hell LW, I'm open to suggestion!
You just tell me, What & How can change the basic direction of the main Economic factors and the river they flow in and I will happily pay attention!
Until then, I await the next episode of "SELL ON THE FACT"!