Stock Market Control
It is we the people that control the stock market. We are the ones which push stock prices up and we are the ones which push it down, and some times we do this dramatically.
Many believe that it is computers that control the market but actually it is the emotions of us mere humans that are in control.The problem of the free enterprise system which we call the stock market is that investors that are often aided by the medial believe that the stock market is doing poorly . This the averages are down, but really, is the performance really that bad?
Relative to both political and economic evironments at abroad as well as at home have the belief that the market is doing well. Since late 2007 we have proably been in a recession, corporate earnings are down and of course thats not all. Most trouble we have all seen in many years is the financial system, which forces the goverment to come to rescue.
Second quarter mortgages delinquencies have increased to 6.41% of loans from 6.35% for the first quarter, shows the deep recession of the housing industry. Data of the recent economics shows that the economy is still seriously deteriorating. Nonfarm payrolls have fallen and we have all witnessed the rate of unemployment jump. Subprime morgage debacle has caused some rather large write offs by some of the leading brokerage firms and banks. Commodity prices have also risen sharply.
This problem isnt just here within our shores its all around. It sounds as if an obituary for stocks has been written but the stock market continues to hang in. Even with all of this the belief of many is that the stock market is performing quite well actually.
For over a year now we have all been living with this bad news, and the bear market is only eleven months old. Most popular stocks and averages are down, and there is also a very bullish supply and demand ratio for stocks as sidelined cash is only recieving a very modest rate of intrest. This usally happens not before the market decline but after.
The stock market looks into the future, nine months to a year. This shows that the stock market is doing well, only that current news says different.
As always the stock market will get better just as they always have.
Some believe that with Fannie Mae and Freddie Mac being taken over by the U.S. goverment is a step in the right direction. What do you believe?
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