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IBDvalueinvestin (99.64)

Down day finally, time to go shopping.

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June 08, 2009 – Comments (5) | RELATED TICKERS: AIBYY

Funny how the big wigs trying to tell us that the market is down this morning because the FED. will raise rates late this year? I might not be a genius but I know that is false:

The truth is as follows:

Rates go down : equals economy getting worse heading into a bear market = stocks go down

 

Rates go up : equals economy getting better heading into a bull market = stocks go up

 

Just amazing how the big wigs are either consistantly lieing to us or they are just plain dumb.

I'd go with they are consistantly lieing to us.

5 Comments – Post Your Own

#1) On June 08, 2009 at 9:05 AM, russiangambit (29.47) wrote:

They are both dumb and lying. Eentually truth comes out and they are exposed for who they are and this is dumb. Especially since they do it over and over again.

 

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#2) On June 08, 2009 at 10:57 AM, prose976 (< 20) wrote:

I think you would be more accurate blasting the media.  Governments are inherantly deceptive.  However, the media has an extremely powerful and influential position in our democracy.  When it sells out to politicians and governments, then we get the misinformation that we see on the broadcast and print news today.  The popular media has turned into a giant advertising outlet, moving voters, investors, consumers, etc.  The person who trusts it (media) and regards it for anything more than entertainment is a fool.

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#3) On June 08, 2009 at 11:12 AM, msol800 (< 20) wrote:

When the fed raises rates, the higher rates are intended to slow inflation, however it discourages new investment and slows growth.  Thus the market declines as that change is priced in the market.

 So, yes a contractionary fed will be present during bull markets but those moves are not encouraging growth.... Thus the market drops, as the rate change is priced in.

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#4) On June 08, 2009 at 11:31 AM, IBDvalueinvestin (99.64) wrote:

Sorry msol800 but your way off the ball. The market rises during interest rate rises because the only way they can raise rates is when the economy is doing well.

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#5) On June 08, 2009 at 2:38 PM, IBDvalueinvestin (99.64) wrote:

Also keep in mind that the FED. has never raised rates while jobs were still being lost. So those saying rate hike is coming must think we will be gaining jobs by the time we get a rate hike? If that happens watch stocks explode up another 20% before year end.

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