Tuesday, May 08, 2007

Can A Winning Streak Be Bad?

The Dow Jones Industrial Average closed at 13,313 yesterday, another all-time high. The benchmark index has risen 24 out of the last 27 days - a streak unmatched since 1927.

Mmmm....how'd the economy do in the years following 1927?

I just noticed that I have the End-Of-The-World Trade on again.

Okay, I apologize. That graph is a little bit on the alarmist side. I don't really think the stock market is going to crash, at least not directly. I believe there could be a bubble in the bond market (30 year Treasury) and we'll just have to wait to see whether or not that's true.

(Technically speaking, the housing bubble has been a derivative of the frothy bond market.)

1 comment:

The Owner said...

You're not the only one making negative predictions.

Like I said, I know very little about the markets and investing in general, but from what I've been reading and from what I do know about the business cycle and government intervention, I'm going to wait for a bit before I put my money in the market. I've got an inkling that there will be a good low point for me to stick things in at sometime in the future.