Yesterday's late afternoon Fed rally that ran up so sharply faded just as sharply today.
Yesterday the Fed's dovish tones had American stocks partying like it was 1999. And today, after the cold water was thrown on the global economy by more dire outlooks from Europe, traders reconsidered and thought, 'yes the Fed is dovish, because the economy is not recovering. Hey, the economy is not recovering. Sell!'
The Fed's jawboning giveth and the Fed actions or lack thereof taketh away. At least in terms of money manipulated wealth.
I don't want to give these markets too much credit for thought though, considering that the average holding time of a stock trade is now measured in seconds. These sharp moves ought not to surprise one too much. This is a very speculative, hot money driven, technical market. It reminds me of a description I read of the stock markets volatile up and down moves in the Summer of 1929.
We are now in earnings season. It was not auspicious that Alcoa beat on earnings and came inline on revenues last night, put out a rosy forecast, and the stock sold off today.
Well that's today. And here in the United States of Amnesia, we only live in the now.
And it doesn't matter if the broad swath of people, thriving, as long as they are surviving. It matters that the things that really count to the power players look good. And baby, our one percent look marvelous.
Have a pleasant evening.