That 10.2% Unemployment Report Was The Best Thing That Could Happen To Stocks

The Business Insider ^ | 11-9-2009 | Joe Weisenthal

[blam]

That 10.2% Unemployment Report Was The Best Thing That Could Happen To Stocks

Joe Weisenthal
Nov. 9, 2009, 6:56 PM

Friday was stunning. After a shock unemployment reading of 10.2%, the market surged. And then, after a weekend of stewing things over, markets rocketed higher again today, and are now comfortably sitting at the highs of the year.

So why the powerful rally despite the so-so fundamentals? Maybe because rising unemployment guarantees a continuation of sub-0% interest rates.

Think about it. In recent months, stocks have maintained a tight 1-to-1 inverse correlation with the dollar. As the dollar declines, stocks go up. Anyway, it's now safe to assume continued dollar debasement, and thus a continued rally.

Granted, there are skeptics. The recent pause in stocks brought out, once again, the likes of Roubini, Prechter, and Faber warning of a shock dollar rally, potentially clubbing stocks dead. But so far, it's not happening, and Bernanke will be in no mood to tighten anytime soon.

[snip]

[EyeGuy]

This is a trader rally, not an investor rally.

How can anyone be confident of the intermediate and long-term success American businesses with the Marxist in Chief infesting the White House?

It used to be great constructive fun to select stocks and align one’s finances and future, with productive American businesses.

[Diana in Wisconsin]

This stuff is increasingly insane. Or maybe criminal? I’ll vote for the latter...

[DuncanWaring]

So if everyone puts all their money into the market, and then quits their jobs, we’ll be wealthy beyond our wildest dreams?

[EyeGuy]

“Bernanke will be in no mood to tighten anytime soon.”

#####

Which will make the inevitable hell to pay, all the hotter and more prolonged.

[MichiganConservative]

Could it be that the stock market is not the economy?

Nah! that’s crazy. I will so be rich once unemployment reaches 100% and my stocks are worth infinite value!!!!

[GilGil]

You want to see where this will all lead?

View this video on Stalin. You won’t be able to take your eyes away.My wish would be that you would pass this on to others. As many as you can.

http://video.google.com/videoplay?docid=-9118985704353138889#

[Question Liberal Authority]

As the dollar declines, stocks go up.

Well, whoop de do. Last I checked, the stock price was measured in dollars.

Also, how on Earth can 0% interest rates be sustained when the dollar is weakening?

[sportutegrl]

Stocks are getting to be a better investment than CDs or government bonds. First, interest rates are abysismally low. Second, CDs and T bills are backed by a government drowning in debt. So, the safety investor may be turning to stocks.

[blam]

Thanks. I’ve seen that already.

[GilGil]

ok. I am passing the link onto as many as I can. I encourage you to do the same.

The people who have seen it, have responded to it quite strongly so it is resonating and bringing home the point about Obama.Stay well.

[giotto]

Definitely criminal, but not insane--at least not for the investors who are reaping profits that are light years beyond obscene.

The market rally is due to one thing only: Goldman and the other gangster banks--let's call them banksters--are taking the bailout billions and turning them into trillions. That was probably the plan all along. Obama wins by having the stock market pumped up, giving the illusion of a booming economy. But it's a banker bubble that will burst at some point--right after the fat cats have taken their profits and shorted everything.