Investment

» permabear - Jubak: A double dip downturn? Wait and see

I think Jubak's predictions in this article make a lot of sense. There is a huge amount of stimulus in the sytem right now between the Fed rate cuts and the rebate checks going out right now. It is very possible that the stock market rally of the past several weeks is a forward looking indicator towards a bounce arising from all this stimulus. But the bigger question going forward is whether economic growth is sustainable when the stimulus peters out. The housing market remains in free-fall. The credit market and banks remain very sick. The American consumer remains deep in debt and is tapped out. I think the odds are high that we get a little rebound, but as a forward looking indicator the stock market will once again turn down as it looks forward to bigger problems down the road.

-- posted by permabear