Skip to comments.STOCKS STAGE GINORMOUS RALLY: Here's What You Need To Know (+287 - QE-3?)
Posted on 06/06/2012 1:16:54 PM PDT by blam
STOCKS STAGE GINORMOUS RALLY: Here's What You Need To Know
June 6, 2012
Markets across the world staged a major rally today, and central banks are at the center of the chatter.
But first, your scoreboard:
Dow: 12,398; +271 pts
S&P 500: 1,312; +27 pts
NASDAQ: 2,841; +63 pts
Now for the day's top stories:
* Markets began rallying in the pre-market after WSJ's star Federal Reserve reporter John Hilsenrath wrote last night that euro woes, disappointing economic data, and strains in financial markets "have prompted a shift at the Federal Reserve, putting back on the table the possibility of action to spur the recovery."
* The ECB decided to hold rates steady at 1.00 percent in its June monetary policy decision. Draghi emphasized that EU leaders need to take more drastic measures, saying "Some of these problems in the eurozone have nothing to do with monetary policy and I don't think it would be right for monetary policy to fill these other policies' lack of action."
* A Norwegian technology site Dagen IT reported that 6.5 million LinkedIn passwords had been leaked and the data posted on a Russian hacker website.
* Reuters reported that German and EU leaders are involved in "intensive contingency planning" to prepare a rescue plan for Spain, even though Madrid has not formally asked for such aid. EU aid would save the country from the embarrassment and restrictions that come with an IMF package.
* European shares zoomed higher despite lack of action from the ECB. The Italian FTSE MIB rallied a full 3.5 percent, and even the Daxwhich has recently been under firerallied 2 percent.
* NASDAQ said it will set aside $40 million to repay investors who lost money due to trading issues during the Facebook IPO.
(Excerpt) Read more at businessinsider.com ...
I have no idea what ginormous is either. It may be a combination of giant and enormous...I guess I'm not cool for not liking 'made-up' words like this. I think youngsters do it these days to conceal the fact that they don't know how to spell.(ahem)
So they’re back to just about exactly where they were last week. Is that about right?
So the DOW is, once again, back up to where it was in 2007 when the Pelosi/Reid Cartel took control of Congress. Not much progress in five and a half years.
My read of the advance is of investors gaining significant confidence in America discarding zer0, in wake of the trouncing of the anti-freedom/anti-business taskmasters in Wisconsin last evening.
Conspicuously missing from that list are the phenomenal Walker victory and the two successful ballot initiatives in Cali last night.
You can thank Scott Walker. The stock market always booms when there is a big Republican election victory, particularly when it is bigger than the MSM projected. The market crashes when there is a Democrat victory or it is apparent that the Democrats are going to win.
In 1994, the stock market began to surge immediately after the Republican sweep. From 1994 until 2006, there is almost a perfect correlation between the stock market and whether or not the Democrats control the House or Senate. In 2006, the market began to tank after the Democrats retook both houses of Congress. In 2008, the market crashed shortly after the Republican and Democrat conventions, when it was apparent that Obama would be the next President and that the Democrats would continue to control Congress.
Since Obama took office, the stock market has basically had an inverse relationship with Obama’s approval ratings. When Obama’s approval ratings go down, the market goes up. When Obama’s approval ratings go up, the market goes down.
damn, easy come, easy go on gold, huh.
Kudlow says because of Walker’s victory. I tend to agree.
On -2% days, Mr. Bear is clawing at the longs. On +2% days, Mr. Bear is clawing at the shorts. Some of the greatest percentage gain days in history have occurred during bear markets.
What happened today is not a positive indicator. It only means that we are still in a bear market, and Mr. Bear will not retire to the woods until he has cleaned up all the toxic garbage left over by Mr. Bull during the long party.
It is immaterial whether Mr. Bear claims his money from the shorts or the longs. Claim it, he will.
Do not take today as a positive indicator.
Oh, but ABC News just told us this is due to the Euro situation stabilizing...nothing to do with Scott Walker /s
Has the revolution started?
call it the “Scott Walker/Unions and Obama are Toast” rally
Like I am going to get out of cash and into the market when it is bouncing around like a yo-yo?
Agree. Yesterday, Americans voted not to be Greece.
It does not matter IMO, the end result will eventually be the same Republican or Democrat.
We cannot ever pay back all this money that we owe...no matter what anyone does.
Delaying the collapse is all anyone can hope to do at this point, IMO.
Lets plug in some numbers and dates and see what patterns develop.
November 1992: Clinton elected President - Dow = 3240
November 1994: Republicans retake control of the House and Senate - Dow = 3807
June 2001: Jumpin Jim Jeffords gives control of the Senate to the Democrats - Dow = 10,990
November 2002: Republicans retake Senate - Dow = 8,537
November 2006: Democrats retake control of House & Senate - Dow = 12,342
November 2010: Democrats lose control of House - Dow = 11,092
Today, a year and a half since the Democrats lost control of the House - Dow = 12,415
Lets review. During the first two years of Clinton, while the Democrats retained control of the House and Senate, the Dow increased but was relatively flat.
In 1994, the Republicans took control of the House and Senate. The Dow exploded, increasing at an annual rate of almost 18% per year for the next 6 & 1/2 years, the entire period while the Republicans remained in control.
In June 2001, the Democrats gained control of the Senate. The Dow then plunged at an annual rate of almost -16% until November 2002, when the Republicans regained control of the Senate.
From November 2002, while the Republicans controlled both the House and Senate, until November 2006, when the Democrats regained control of both the House and the Senate, the Dow increased at a rate of over 20% per year.
In November 2006, the Democrats regained control of both the House and Senate. During the first two years of Democrat control (from November 2006 to November 2008), the Dow plunged at an annual rate of almost -15% per year. After four years of Democrat control of both houses of Congress, the Dow was down 10% from where it was before the Democrats took control.
In the year and a half since the Democrats lost control of the House, the Dow has gained 12% and is finally back to where it was in 2006, when the Democrats took control of Congress.
Anyone else notice a pattern here?
Republican Control = Bull Market and Prosperity
Democrat Control = Bear Market and Depression
It is not hard to do the math.
If the Tea Party Republicans take control of the U.S. senate in November and solidify control of the House, while ejecting the Socialist-in-chief, the stock market will be in for a rocket ride.