patrick.net

lostand confused says

What I am seeing is that from 2009 low, the Dow has gone up close to what-almost 150%??? I don't see the underlying support for this.

why are looking from 2009 to now ? why are you not looking at how much the stock market has gone up since 2000 ?

treatmentreport says

It's not that the rates are still low; it's that they are a lot higher than they were two months ago. It's the derivative that matters.

There are many people nursing huge losses on muni funds, emerging market bonds, corporate bonds, etc. Don't tell me that it's does not affect "consumer confidence". The only market that is still up is US equities. Everything else is in the red of the year.

The derivative only matters if there is credit bubble. US equities don't have any credit bubble.
everything is down except US equities.The only one time i agree with cramer : there is always a bull market somewhere.

BTW, if it was that easy to predict a correction just based on interest rate hike, then every economist would be a market timing guru. We all know we cannot time the market.

chanakya4773 says

US equities don't have any credit bubble.

You clearly don't understand what credit bubble means.

treatmentreport says

chanakya4773 says

US equities don't have any credit bubble.

You clearly don't understand what credit bubble means.

maybe i am ignorant, can you explain me the credit bubble in US stocks or US economy in general which is sensitive to interest rate hikes ?

chanakya4773 says

maybe i am ignorant, can you explain me the credit bubble in US stocks or US economy in general which is sensitive to interest rate hikes ?

Here is my definition of a credit bubble: A company that was fighting for its existence 15 years ago, sells 17B worth of long term bonds at records low spread over treasuries, so that it can buy back shares and pay dividends.

treatmentreport says

Here is my definition of a credit bubble: A company that was fighting for its existence 15 years ago, sells 17B worth of long term bonds at records low spread over treasuries, so that it can buy back shares and pay dividends.

That's a poor definition then. A company's health 15 years ago likely doesn't have much correlation with its ability to pay bills today. 15 years is a long time.

A better definition would a company that is fighting for its existence today getting 17B worth of long term bonds at low spreads.

Interesting the 1Q GDP has been revised lower to 1.8%. I wouldn't be surprised if the Dow comes down to 8,000 or even 7,000 before it resumes its climb and as usual the timing , QE etc are all big factors. But just my opinion.

tatupu70 says

15 years is a long time.

Exactly my point. 15 years is a long time and some of their bonds are for longer duration.