Who is shoring up markets?

So global markets considered the Greek event with a one day sell off. Slight correction and all is well again.

China is no longer in correction mode with the Shanghai index gaining more than 5% overnight.

The euro strengthened overnight as well against dollar and Puerto Rico’s $72 billion debt bill will be serviced for the time being despite what the Commonwealth’s governor said.

Welcome to the post-Lehman Bros. trading world, where central bankers buy and sell stocks, bonds, futures, currenciesĀ  and commodities to shore up a troubled market.

The terms investor confidence and investor sentiment no longer are valid reasons to buy the market during or soon after a crisis, because the sentiment maybe just the Federal Reserve, the ECB, the World Bank and/or the IMF shoring up a teetering market.

One can’t be sure who is doing the shoring up and for what reason.

One thing is sure, investor confidence and investor sentiment still applies on the way down as investors charge for the door.


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.