|
PureBytes Links
Trading Reference Links
|
Now that Chairman Greenspan has admitted "puzzlement" over the NEW ECONOMY
(new paradigm, goldilocks, it's different this time, etc.), it appears we are
now witnessing the Final Capitulation of the old paradigm economic approach.
Alan Greenspan remained (publicly), until today, mostly held by the economic
theories that inspired his repeated pronouncements and concerns about
subsurface inflationary fuel. Without completely abandoning concerns of
future inflation stimulated by such noted phenomena as - the wealth effect,
tight labor markets, wage gains, growth/employment barriers, etc. - he seems
to now be aligning himself (and the Fed Board) with the new paradigm
thinkers, i.e. "Rational exuberence, at least for now".
The comfort zone of a fundamentally "bullish contrary opinion" in the stock
market must now be reexamined in my opinion. In light of the renewed
exuberance today in the S&P (rational or irrational), the warning light is
now flashing for the Bulls. As a former leading guru from the Jurassic Period,
granted "god-like insights" by traders and the media in his heyday, used to
say --
QUESTION: "What does the economy have to do with the stock market?
ANSWER: Absolutely nothing.
No Virginia, they don't ring a bell . . .
Good trading,
Larry
|