Is the Bear Market Over ?If you are investing online and have been following the stock markets lately then one of the most overworked phrases you are likely to have heard is "there will not be a V-shaped recovery". The problem with this is that if everybody is convinced there will not be a V-shaped recovery then it is more than likely that that is exactly what we will get.
It is of course important when trading the stock markets to seek stock market investing advice - unfortunately, as we have seen over the last two years, the people who are giving the advice are generally clueless. How many of them actually said back in 2007 that the DOW and the S&P500 would collapse by 50% ? Not many. There were one or two, but one or two out of the many hundreds that are paraded on the TV finance channels is not a lot and not very impressive.
How many of them said "don't invest in the stock market ! Bear Stearns will disappear, Lehman's will disappear, AIG will be nationalized, Fanny Mae and Freddy Mac will be nationalized etc... etc... ? GM will file for bankruptcy ?" I would guess that the answer to that would be none.
So right now most of the experts are saying that there will be no V-shaped recovery and that the recovery will be slow and painful. Most of the experts that I hear on TV expect the stock market to re-test the bottom set in March around 6600 on the DOW and 667 on the S&P500, but so far it doesn't look as if the markets are keen to do this. Which makes us wonder just exactly who controls the stock markets ? Why would the stock market be going up when most people are not buying but are sitting on the sidelines ? Or could it be that they are saying one thing and doing another ?
The upshot of all this is that you really have to make up your own mind. The 'experts' don't know what's going on, as it was the experts that created this mess in the first place. Did they do it on purpose ? Was it all engineered by Goldman Sachs which seems to have been the main beneficiary of this financial meltdown ?
Trust no-one !
Today, despite no V-shaped recovery being expected the markets are still holding up well with the S&P500 up 5 points at 857 and the DOW is up 14 at 8044. Warren Buffett may have got it right by buying in October 2008, so maybe he can be trusted, but even so you need to be a long-term investor and have deep pockets if you are going to hang on in there with Warren Buffett.
The tech sector (+2.0%) has been the liveliest sector as investors buy Google ahead of its earnings report this evening.
The number of jobless continues to increase but this of course could be good news for the stock market as profit margins can increase at the same time,
March housing starts were 510,000, against 540,000 expected. This a reversal on last month where the figures were better than expected.
The stock market is a very confusing place to try and make money with your online stock trades , especially if you are not one of the insiders, and as we have seen the vast majority of them got it wrong