Recession's end is already priced into stock markets |
| USA Today - Sep 20, 2010 |
Just because the Great Recession has been officially declared dead doesn't guarantee that stock prices will shoot straight up in the months ahead.
Sure, it's good news that the National Bureau of Economic Research said Monday that the recession that began in December 2007 officially ended in June 2009. But that doesn't add up to an "all-clear signal" for investors, says John Stoltzfus, senior market strategist at Ticonderoga Securities.
The reason: The NBER's declaration that the recession is over is a "lagging indicator." In other words, it is old news to investors. Many Wall Street firms, as far back as the summer of 2009, were issuing reports saying the trough came in June 2009.
In the 15-month period since the end of the recession and the start of the expansion, the stock market — living up to its reputation as a forward-looking pricing machine — has rallied sharply to reflect the improving economic conditions.
Read Full Article from USA Today
- Posted: 2010-09-20 21:02:37
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