Why is the market going through the roof when

we are in an economic stagnation?

:wtf:

The Dow closing a 11,850. Broken several records in as many days. What's up?

will make money?

Just invest in big oil, defense contractors or pharmaceuticals.

It's a no-brainer.

So true. Take a guess where any of my stemcell-stocks are...I guess I'm just too dumb.
I should be happy that the DOW is that high but honestly, it doesn't really affect the stocks I have/had. 5 or 6 years ago, my stocks were worth twice as much.
And no, I barely had any internet stocks.

falling off a cliff...

Investors are chasing short term gains instead of long term investments and so they are buying into the next best thing hoping they can repeat the dot.com boom of the late 90's....

When dems control congress, the market always does much better than when the repugs are in control.
I think people are trying to climb aboard in anticipation of Dems taking back congress next month.
I am currently pretty heavy in the market for that reason. We are just now getting back to where we were in Jan of 2000. It's time for a growth spurt! Not to mention lower fuel prices makes everything cheaper because of shipping costs.

Although for the most part, I think it's just really a big crap shoot. :)

in a few months?

I think there really is something to that theory. Political situation is one consideration when investing in any country.

driving the price up just before whatever nastiness the insiders have in store for us (terror, war, etc). they'll all dump their stocks before the crash and leave everyone else holding the bag.

somehow missed the fact that the prices have been going down the last four weeks.

I will bet that's the same in every business. Now, they get to make higher profits because people already ACCEPTED the higher prices last month when higher gas was a factor.

Two days ago I pointed to a small bunch of parsley and said "1.59 for parsley?" The manager said "High gas prices" without a second hesitation. Something I would have accepted in August, but not now.

Or a balloon game if you prefer. All the wealthy do is move their money from balloon to balloon. Stocks, gold, oil, real estate, money, bonds, and around and around it goes. Then tell the peons to "buy and hold". Everything is set up to suck our money into their pockets.

and stocks have languished from terrorist and oil cost fears. There is one heck of a lot of built up momentum that may now bust out. Dow could rocket to 12500 quickyet this year.

so the speculators who drove the prices up are cutting their losses and putting the money into stocks.

Easy one.

Tinfoil hatters might think it's because the smart money knows the grownups (Democrats) will soon be in control again, but the housing bust explanation makes more sense to me.

You realize how many years it has taken to get to gradually get where it is. Can you imagagine where we would be if Clinton had two additional terms. Greenspan was actually arguing with Clinton against using surplus billions to pay off the debt. Now many other countries now own the bulk of USA. And we continue to move important companies out of U.S.

into the pits.

The Dow Jones Industrial Average is based on just 30 stocks.

There are many other, much broader indices that paint a much different picture.

http://finance.yahoo.com/q/bc?s=%5EGSPC&t=my

If you look at the gains in the stock market over the last 5 years compared to the US dollar you will see that gains are closely mapped to the loss of value of the US currency.

If you purchased stocks with Yen 5 years ago they would be worth about the same in Yen today. By international standards the US market is stagnant. This current economy is very similar to the Japanese market of 15 years ago from which Japan has only recently begun to truly recover.

I believe the main reason for the increases is that since most DOW companies are multinational, their international assets increase in US$ as the currency deflates.

nt

It seems there's no money in the 'Public Sector' any longer.

To get repug votes.

After the (s)election, the Stockmarket/hedge/Ponzi will come down big time and the newly (s)elected repugs will be laughing their butts off.

Good luck folks.

Because wealthy stock owners like to see their porfolios tank?

Hedge's are just ponzi gambling.

The Stockmarket has become a Vegas/Ponzi.

With the propping up of the market for political purposes, the old adage comes to mind. What goes up must come down.

Now to answer your ?

Wealthy stock owners can take hits even big ones, but they do not control world politics which is what controls all markets.

There is 10 trillion in hedge/ponzi/gambling and it will cause a huge problem with the value of the dollar in the very near future.

The only thing holding up the dollar is the war machine and this cannot go on forever.

Find an honest/qualified consultant and good luck.

at the height of the last run-up?

Gold goes down - stocks go up.

Energy prices go down - stocks go up.

World political environment (e.g., Middle East) becomes a bit more stable - energy pices go down.

The U.S. stock market is much broader than U.S. economy because many corporations are truly multinational in scope. It is not a good measure of th U.S. economy.

The bulk of funds invested are through insitutional investors. Deivative securities are used to managed corporate risk. As those risks shift so does the market. Same is true of institutional trends and analysis. And remember there are many who do not participate in the market. They don not buy or trade stocks. Any impact they might have would result from their consumption habits.

Tax law and practice can impact he market by impacting financial reporting and calculation of earnings. Typically this is related to allocation of revenues and expenses or the timing of such acknowledgements. Changes here can impact the market.

Recent studies have suggested a common practice of insider trading.

It is not uncommon for brokerage houses, traders and investment bankers to maintain an inventory of stocks. The very people who facilitate market operations have the ability to influence market pricing and valuation through their inventory practices.

It would be relatively easy to manipulate the stock market - assuming you had the available money to do so of course. Many stocks are included in the computation of multiple sotck indices. One would only need to manipulate a few of these stocks to manipulate the market.

Obviously, the Federal Reserve already plays a role in manipulating the bond and currency markets through their rate setting authority and regulation of bank reserves. The stock market is also tied to the bond and cash market.

The idea that the stock market is a free market is an illusion.

And the idea that it reflects the status of the economy is also flawed.

The lower the expense, the higher the profit!

Just because people are working 2-3 jobs (job creation!) to make as much as they used to with one, has nothing to do with the stock market...

Then, when people like you and me have lost money investing on sane fundamental principles, we can look back, slap our foreheads, and say "Why didn't *I* think of that?"

In this case, I'm wondering if the main reason is housing. The market crash of 2000 was one of the factors behind the current runup in real estate -- investors were looking for somewhere to park all the money that had been pulled out of the stock market. Now that real estate is tanking, I suspect that money is pulling out of real estate and flowing back into the market. At least that's my personal theory.

When a stock or an index breaks into record high territory, it usually begins a rally of at least 10%. However, there are reasons to that this particular record may not result in a strong rally: (1) The Dow is the only major index so far to reach new highs, (2) a rise in the Down combined with a decline in the NASDAQ often means a "flight to quality" rather than a sign of market strength, and (3) breadth has decreased during this rally, meaning that while the indexes have gained, the number of individual stocks on the rise is declining.