You might want to start looking for a chair before the music stops. From Charles Hugh Smith at oftwominds.com:
As I often note, making Plans B and C is free.
The stock market is always looking past “bad news” to front-run “good news.” Once it became clear that the Titanic was indeed going to sink, the stock market would rally on the prospect of sharp growth in lifeboat shares. In other words, never mind the bad news, let’s look beyond that and find some reason to rally.
This is a pattern that’s easily visible in the past two decades. When it became clear that Covid was becoming a global pandemic, the US stock market rallied for weeks, something that struck sober analysts as completely disconnected from reality. Eventually reality intruded and the market crashed.
The same dynamic was also apparent in the run-up to the 2000 dot-com implosion–stocks rallied right up to March 6, 2000, before starting a two-year long controlled demolition–and the 2008-09 stock market crash, when shares of visible doomed General Motors and Fannie Mae both maintained lofty valuations that were completely disconnected from a painfully visible reality. (Fannie Mae shares went to near-zero in the subsequent crash.)
And so here we are again. The stock market is rallying despite overwhelming evidence that the US economy and global economy are heading for a deep recession. The justifications are either 1) the AI boom is changing everything or 2) the Federal Reserve will continue lowering interest rates and flood the market with liquidity, i.e. “The Fed Put” will save the stock market, just as its done for the past 25 years.
Muh free market Potemkin fairy tales?
Fake and fruity just like everything else.