Thursday, April 02, 2009

Do ya feel lucky?

Long time readers of the Calculated Risk blog were probably surprised by the title of one of today's post:
Markets: Another Day at the Casino?
Mr. Calculated Risk is a sober type who only allows himself the occasional droll remark. As a rule, he keeps his opinion-level very low, and is always civil (even while the comment threads get raucous). This is the first time I've seen him characterize the stock market as a casino. He's referring to today's big up move, possibly related to the change in accounting that would allow banks to put their own value on their paper, which has the potential of actually reducing transparency (opinions vary).

If I had to guess, CR thinks that there is still some unwinding and fall-out from housing, manufacturing (autos), trade, and government activity (reduced at state and local level), and sees today's market action as not in accord with the 2009-2010 trend. He's up there in years (as am I) and no doubt recalls when real bottoms were in in 1974 and 1982, when everybody was totally disgusted (and disinterested) in stocks. Yes, there's been a lot of hurt in the last 18 months, but there are still strong pockets of "we're on the road to recovery" that indicate that greed hasn't been wrung out of Wall Street. Hence, the casino metaphor.


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