This recent meltup on "less bad" news reminds me of the
relentless upward climbing of the "Wall of Worry" after the
March 2009 bottom. The argument back then was things were
"less bad" or getting worse at a slower pace (2nd derivative turned
positive). Here are some fundamentals supporting this again
now:
Feels Like 2009 Again - "2nd Derivative" Trade Points Up
Posted by sethbru on 19th of Jan 2012 at 03:15 am
This recent meltup on "less bad" news reminds me of the relentless upward climbing of the "Wall of Worry" after the March 2009 bottom. The argument back then was things were "less bad" or getting worse at a slower pace (2nd derivative turned positive). Here are some fundamentals supporting this again now:
LIBOR has finally stopped rising: http://www.bloomberg.com/apps/quote?ticker=US0001M:IND
HARPEX (better at trending than BDI) has bottomed: http://www.harperpetersen.com/harpex/harpexVP.do
Bank loans (especially Commercial & Industrial - see 2nd graph) steadily rising: http://research.stlouisfed.org/publications/usfd/page20.pdf
Chart-wise, it seems we had a Golden Cross recently, and the "1961 Mechanical System" (long-term trend) signalled UP recently.
Liquidity-wise, we have the Fed and ECB easing with hints of more QE, and now China looks ready to ease again.
Perhaps "Muddle through" is working.