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Ultimately the stock prices respond to economic reality: profits and interest rates and growth levels The funny thing about headlines though is that often the
by graeme 4y ago
Ultimately the stock prices respond to economic reality: profits and interest rates and growth levels
The funny thing about headlines though is that often the reverse happens. Once everyone is crying doom, stocks go up. When people say it is time to buy, stocks go down.
And in a bear market the bottom usually comes when no one is paying attention anymore.
As an example after the financial crisis stocks bottom March 2009, after two years of falling and a good seven months after the big crisis.
- Cupertino95014 4y agoExactly right. The bull market begins when the last seller has bailed out. So, has that happened yet?
- medvezhenok 4y agoCommon quote, doesn't have much to do with reality. Last 3 bottoms (2009, 2018, 2020) were manufactured because of regulatory changes.
- Cupertino95014 4y agoright, politics is one thing that really drives the market, because (usually) you can't predict it. If you could, it would already be reflected in the prices.
- medvezhenok 4y agoMarch 2009 was not a "natural bottom", it was more of a bailout bottom - we now know it happened because of a change in the mark to market rules on bad assets that made possibility of more bankruptcies much less likely and stemmed contagion. Similarly in 2018 (FED pivot) and 2020 (QE infinity). You'd have to go back to 2002 possibly to find a more "natural", exhaustive bottom where sellers got tired.