I suspect the real reason the market is still in decline is because it has not yet cleansed itself of the investment inflation resulting from Bush and Clinton.
Like Scylla and Charybdis, these two encouraged a storm of leverage and that storm has now imploded. The marjet value of stocks was based on the ever expanding source of virtual capital generated by leverage schemes. If I am correct, the market will now start to level out as we discover the depth of the downturn and then stabilize as tye real value of investments, as oposed to their speculative value, takes hold.
Cross Posted at Sound Politics: Comment on Provocation of the Day
Friday, February 20, 2009
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