Hilarious/sad. So Tuesday, I see this story about how the “little guy,” retail investors, have finally gotten back into the game, back into the stock market.
As a historic bull market reaches its second birthday, everyday investors are piling back into stocks, finally ready for more risk and hoping the rally has further to go.
The Standard & Poor’s 500 index has almost doubled since March 9, 2009, when it hit a 12-year low after the financial crisis. And the Dow Jones industrials are back above 12,000, about 2,000 points shy of their all-time high.
Little-guy investors appear to be on board. Since the beginning of the year, investors have put $24.2 billion into U.S. stock mutual funds, according to the Investment Company Institute. They withdrew $96.7 billion in 2010.
“It didn’t feel right to be back in until now,” said Richard Dukas, who heads a public relations firm in New York City. “I still don’t want to put all my money in the market, but I believe we’ve come through the worst of it.”
That’s the kiss of death, isn’t it? When John Q. Public decides – hey, look how high this thing has gone and we’ve missed the ride; but maybe the ride ain’t over yet, so let’s hop on board.
You know how that story ends, right? The Dow down 217 points as I write this, below 12,000. But who knows. By the end of the day, we could be all the way back in the green. That’s how fraudulent/effed up this market is. And I really wonder if newbie/returning retail investors have the stomach for it, not to mention the money.
The talk yesterday was on an extraordinarily significant move by PIMCO’s Bill Gross, PIMCO being the biggest bond fund in the world, but Gross has dumped all of his U.S. Treasuries.
“So should we be alarmed?” asks the Economic Collapse Blog.
The talk over at Zero Hedge was that this suggests Gross thinks – or perhaps knows – that there isn’t going to be any QE3. Or, that the fed may try to pave the way for QE3 by first saying it won’t happen – and then, given that QE is basically propping up the markets right now, the markets plunge; and then we’ll all be absolutely clamoring for QE3, particularly those retail investors who just got back into the damned markets.
TEH PEOPLE WANT MORE QUANTITATIVE EASING!
So if there is more QE – and there has to be, doesn’t there, regardless of how ultimately unsustainable it all may be; we’re playing for months here, not years – then TEH PEOPLE are mollified, the market may resume its ramp up, and then our Leaderz can tell us – look at your 401(k), things are on the mend, reelect us.
And we will. Of course.
Bottom line, it’s not a time to trust either the integrity of the market – or the integrity of those trying to imply that a clearly rigged game is the real, legitimate deal. Buy the freaking dip, if you like – but don’t be the freaking dip.