Dow Jones industrial average has its best four weeks since 1933 - scare anyone else?

[TwixVoy]

Does this scare the hell out of anyone else? If I recall correctly there was a MASSIVE stock rally (one of the best on record) around the time of the great depression just before everything went completely to hell.... and here we are having the best four weeks in the last 75 years right in the middle of a massive "recession".


"Investors dove into stocks Thursday, extending a rally that gave the Dow Jones industrial average its best four weeks since 1933."
http://us.rd.yahoo.com/finance/finhome/topstories/apf;_ylt=AhnzKmcJGqOnEEMZskQmyge7YWsA/*http://biz.yahoo.com/ap/090402/wall_street.html?sec=topStories&pos=main&asset=TBD&ccode=TBD

[LSparkle]

1. Yup, Thom Hartmann was saying something similar this morning ...

He predicts the Dow will be at 5K within the next 18 months.
I'm sure he's been listening to his frequent guest, Ravi
Batra (economics professor at SMU), who's been pretty right
about this whole mess ... My 401(k) isn't going back into
the market any time soon.

[GoesTo11]

6. I ain't scared of 5k

There just isn't that much left to lose. We've already lost twice as much going from 14k to 8k as there is to lose from 8k to 5k. Anyway, to the extent the market is bouncing just due to psychology, that shouldn't matter to long-term investors. To the extent the real economy gets destroyed (and to the extent that that's driving the market drops), that is bad.

[uppityperson]

2. You mean that the stock market is so volatile?

[Cali_Democrat]

10. Bush wanted to privatize social security and put the money into the stock market

That would have been a fantastic idea.

:sarcasm:

[Whalestoe]

3. The only thing we have to fear...

...Is the DOW JONES itself!

[billyoc]

4. No. Adjusted for inflation, the Dow hasn't gained or lost a nickel in 30 years.

[tinkerbell41]

5. Yes

Karl Denninger:A bunch of people on DU think he is a doomsayer I'm not so sure.
He has been right on target for awhile. I started reading his stuff last June.
I don't know how I found him but i moved all my annuity money before "it" happened because of him.
I saved myself. Google his name or go to The Market Ticker. I feel we will drop off a cliff soon. If he's wrong then my bad.

[NNN0LHI]

7. Republicans and the Nader Nuts are fucking terrified that Obama's economic plan is working

Thats for damn sure.

Don

[Statistical]

8. Markets are leading indicator and they also gauge investor sentiment.

If you wait for the economy to recover before investing you will miss the train.

Stocks are based on the forward looking projections. In every recession the market recovered before the economy. Payroll is a lagging indicator btw. So the economy (for those with a job) will be doing well before jobs start coming back.

Now I am not saying this but the MARKET and thus the INVESTORS in the market is indicating a recovery around early 2010.

Now you may say why not wait until 2010 then? Well nobody wants to miss the train.

Lets say the economy turns the corner in Q1-2010. For the sake of argument lets just accept that as a fact.

Well obviously you will want to have money invested in companies likely to lead that recovery before it happens. However if you wait until 1 day before, someone else will get in 2 days, and another guy 3 days, etc.

Essentially when the market is rallying what it is saying is:
"We understand stuff is bad right now but the future is looking better and even if companies continue to lose money long term they are good BETS. The stock is priced much lower than its value so I am getting in here".

That being said I am selling into this rally. I think we can see S&P 900 but I will likely take some profit around mid 800s, then little more around 870s, then little more, just under 900, etc.

Don't sell all at once but always take some off the table. We likely will go down more maybe mid 700s but I think we are done w/ S&P 600 territory.

[Mike 03]

9. Skeptical, but not scared.

I think this is a psuedo rally, and we will see another pull back, but I'm not overly terrified that this prefigures a major collapse. I think it is just further volatility that will continue (unfortunately) for some times (years).

We are neither buying nor selling at this point.

ON EDIT: We have been mostly in cash for more than a year, and are making very selective purchases here and there, and holding onto some specific good prospects.

[nadinbrzezinski]

11. Yes and no

let me explain....does follow that pattern, but unlike the 1933 rally...this is coming after a lot of intervention has already occurred

that is what's different