[rhombus]

Don't people sell off stock losers at the end of the year anyway?

[xrp]

For market/DJIA/Wall Street savvy Freepers, what is the consensus on the outlook for 2006?

[xcamel]

Yup, and buy them back 31 days later

[Lekker 1]

Is it me, or did this AP story have a certain amount of glee in it?

[2banana]

To avoid a recession - is a good reason for tax cuts. Dems will push for higher taxes.

[antaresequity]

Don't people sell off stock losers at the end of the year anyway?

Yep...nothing to worry about here...its a buying opportunity.

When price/earnings ratios get to 100, then you should worry about selling...not a moment sooner...

/sarc

[Fiddlstix]

BTTT

[DManA]

Market is sensing that inflation is not a factor for the forseeable future.

[groanup]

"The ecnomic forecasting ability of the yield curve has been greatly diminished."

Alan Greenspan.

We'll see.

[Pondman88]

Yield curve inversion has not always preceded a recesion.
Judging by the sheer insanity of the mall yesterday, the crowds of people shopping, and my liberal brother's comment that the economy sucked....2006 is going to be a very good year.

[montag813]

WAY too many folks (including on this forum) were expecting Dow 11k this week; the "Santa rally", etc. for it to possibly work.

[Protagoras]

Don't people sell off stock losers at the end of the year anyway?

Usually against profits. Not a lot of people have profits for the year.

[Darkwolf377]

signals that in the past have preceded economic slowdowns

Why didn't the AP just headline this "COME ON, ECONOMIC SLOWDOWN, COME ON!!!!"?

[devane617]

Anyone know if we have an "Investor" ping list here at FR? I am an evil DayTrader, or at least I like to think of myself as a trader, but in reality my returns are less than stellar.

[quant5]

I think trend will not hold this time as it has historically. The Feds intention was to purposely cool the housing market by raising short-term rates. That appears to be working but it has not slowed the entire economy down. If anything, it will be energy that slows the economy from a great bull market in 2006 to a slow but steady bull market.

[databoss]

Earth to Krugman this condition was crossed many months ago...

[1Old Pro]

The Friggin Fed should have stopped raising short rates 6 months ago.

[Dems_R_Losers]

Is this surprising? OF COURSE short term rates are higher than long term rates right now. Long term rates are set by the market. Short term rates are set by the Fed. Greenspan has been raising short term rates for over a year trying to burst the housing market the way he did the stock market in 2000. It hasn't worked. The market is telling the Fed to stop raising interest rates! It isn't a harbinger of recesssion if the Fed will just listen to the market and get the hell out of its way.

[Lazamataz]

We're all gonna die!!!!

[trek]

This is all bunk. Despite what you are hearing in the press, the yield curve is NOT inverted.

From the latest Treasury Auctions:

Rate on the 91 Day T-Bill, 12/29 auction 3.999

Rate on the 10 Year Note, 12/15 auction 4.490

There is almost 50 Basis Points between the long and short end of the yield curve and these are not the best numbers since the yield on the 20 years is even higher. It may be true that some intermediate rates are inverted by a few BP. But this is meaningless.

People should stop wetting their pants over the yield curve. A real data point will be available in Feb when the Treasury auctions a new 30 year bond. I rate the chances of the rate on that issue being lower than the rate on the 91 day T-Bill at zero.

[byteback]