After a strong run-up Thursday followed by a weaker one Friday, major US stock indexes are in retreat.
The Dow, the S&P, the Nasdaq and the Russell 2000 have all surrendered more than 1%, a move attributed, in part, to a realization that the eurozone rescue plan bears a striking resemblance to Gertrude Stein’s description of Oakland: “There is no there there.”
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Zombified Government Spending
The huge rally on Wednesday of last week fizzled by the end of the week.
What a week. Full of sound and fury…signifying nothing.
Wednesday’s rally was the “seventh best day for the DJIA in 110 years,” reports our Bonner Family Office analyst, Chris Hunter. “And sure, this sounds pretty impressive. But it’s useful to bear in mind that the best day in history for the DJIA was on October 13, 2008 (when the index shot up 936 points). In the next few days the DJIA was down 11%. Then it shot up again by 15%. Then it nosedived by 25%. The next best day after that for the index was October 28, 2008. And the sixth best day came six days after the top of the Nasdaq bubble, on March 16, 2000.”
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