The "fiscal cliff" deadline came and went without even a bearish whimper from the stock market. Now, the so-called "budget sequester" -- a set of laws that limit federal spending -- was put into effect on March 1. Absolutely nothing negative has happened to the economy -- so far.
The bullish reactions to these events, which may result in long-term, negative overhang on the thriving stock market, have lulled many investors into a false sense of security. These satisfied investors point to the stock market roaring higher, steadily improving economic numbers and to bad news being dismissed as irrelevant as sure signs that the market's surge won't end any time soon.
If you thought two weeks ago was rough, last week's 7.0% slide made the previous week's 4.0% pullback look like child's play. There is sort of' a bright spot in there though, IF the bulls play their cards right and the bears still aren't angry. (That's a big if though.)
Before we slice and dice the market though, let's run down last week's and this week's big economic numbers.
Even relatively good news was treated like bad news last week by expert market analysts. Mainly, a slightly optimistic employment picture still didn't stave off some serious selling. The unemployment rate fell from 9.2% to 9.1%; job creation easily topped the expected figure of 100K with 154K new payrolls added, and unemployment claims basically held steady. Nobody cared. Continue reading "Lowest Trailing P/E Ratio In 2 Decades, But..."→
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