Stock Market Idiocy

Stocks are way up again. From this story, “Thursday’s gains followed news that sales at the nation’s retailers were flat in October, better than the 0.2 percent decline analysts expected.”

Retail sales didn’t go up. They just didn’t drop as much as investors expected, so stocks go UP!

“People are looking for reasons to buy stocks, rather than sell them. When investor psychology changes, that is what happens. Two months ago nobody wanted to buy,” said Michael Murphy, head trader for Wachovia Securities.

Here’s more “upbeat” news today to send stocks even higher: Sprint PCS to Lay Off 1,600 Workers, Tokyo Stocks Tumble to New Lows Again, Credit Suisse Reports $1.4B Loss, Mall Retailers Earnings Slide, PG&E Reports Drop in Third Quarter, Greenspan Sees Economy ‘Soft Patch’, Sears Stock Tumbles on Downgrade, GE’s Aura Rattled by Worries, Skepticism, AMD to Cut 15 Percent of Work Force, Argentina to Miss World Bank Payment, and my favorite, because I’ve been writing about the huge pension problem, Honeywell: $1.7 Billion Pension Deficit. And what is Honeywell putting in the pension plan to make up the deficit? “”We anticipate a substantial portion of any such contribution would consist of Honeywell stock,” the company said.”

We’re in a stock bubble again. Watch out. And if you’re expecting a pension from Honeywell … uh … well … good luck.