Wednesday, May 16, 2007
Irrational Bull Market?
There seems to be a preoccupation with how many days the market has been up vs. how many days down and somehow this is irrational hense the big correction is right around the corner. Compare the chart of the Nasdaq in 1999 & 2000. 19 up weeks to 2 down weeks. The Naz gained roughly 80% in 4 1/2 months. Most of the companies in the index weren't even profitable. That is irrational. Now compare the S&P which is up about 23% in 10 months. Dominated by financials and energy stocks that are making money hand over fist, I'm not sure how the word irrational can be used to describe this market.