-- Market Summary, Thursday afternoon, March 5, 2009
This morning, guru Art Cashin said:
Art Cashin wrote:
> Yesterday's stimulating stimulus was not mentioned by the
> Chinese. I think that's undercut world markets, and we're back to
> worrying about what we worried about before.
> I think we'll head lower, but I think, as I said yesterday,
> between here and Saint Patrick's day, there's going to be one
> whopper of a rally coming. At least that's the feeling. We
> revisited the 12-year lows, we've only done that 3 times in 109
> years, and the other two times we did it, we were either at the
> lows of the move, or within 3 months of the lows of the move.
Cashin has been predicting a rally almost every day for the last
year.
Well, there wasn't a rally today, as the markets fell to a new low
for the current century. The market is now back to the levels it was
at the time when Alan Greenspan warned about "irrational exuberance."
The New York Times said, "Stocks Drop Sharply on Retail Data and G.M.
Audit. Wall Street fell to new lows on Thursday as investors reacted
to more concerns about the fate of General Motors, dreary retail sales
and the financial sector. The Dow Jones industrial average and the
Standard & Poor's 500-stock index closed down more than 4 percent."
They might have added that Hu Jintao didn't announce a new stimulus
package for China after all, as had been expected.
One person said woefully, "This is not the big carthartic puke we
were hoping for." This is still the hare-brained "capitulation"
fantasy -- when the big "cathartic puke" finally occurs, they expect
the market to pop back up.
Today's award for idiot of the day was Robert Brusca, President of
Fact and Opinion Economics, and former chief of the NY Fed's
international Market division:
Robert Brusca wrote:
> We've got a signal from something that I look at from the
> manufacturing ISM that suggests that we're getting into rebound
> territory, and so I'm getting encouraged by that.
> And we saw claims today fall from their peak and it's a very
> highpeak for claims, that's true, but jobless claims tend to peak
> very close to the end of the recession, so once you've gotten a
> peak, and once it's authenticated -- and it's not authenticated
> yet , it's a volatile series, we could still see a higher number
> -- but if it's an authenticated peak, you'd expect to see the end
> of this recession coming around in a month, or maybe even two
> months, before not too long.
> What happens is that the low point in non-farm jobs tends to
> occur really right at the end of a recession, except for the last
> two recessions.
> The last two recessions were the exceptions. And the reason is
> that we lost jobs at a very slow pace.
> I tend to say that recessions are a little bit like billiards.
> The ball tends to come off the the cushion the way it goes into
> the cushion.
> So if you're losing jobs at a very painfully slow pace, you're
> going to gain them back at a very painfully slow pace.
> We're losing jobs at a horrific pace. And in fact if you look at
> it, compared to most recessions since about 1960, we're really on
> track to have a V-shaped drop and a V-shaped rebound, which means
> a nice strong rebound in jobs when it's over.
Once again, we have a guy who earns a 6 or 7 -digit salary, and the
above stuff is total crap. A recovery within two months. And why?
Because we're losing jobs at a "horrific" rate, and because we've
reached bottom, and because we're going to gain jobs at the same rate
we lost them, which is what we saw in the past, as long as we skip
the last two recessions, when it didn't happen.
I can't believe this. How is it that one total idiot (or crook)
after another comes on to Bloomberg or CNBC and spouts stuff like
this?
Sincerely,
John