Tuesday, October 14, 2008

If markets are a barometer

than the sell off wasn't due to banking crises, forced liquidation, mark to market losses, no it has to do with the simple fact bond rates are going higher which thereby implies lower PEs for corporations.

In 1982, bond rates were heading lower. Stocks were bound for stratopheric heights. The circle is reversing and once again implies, IYR, has nowhere to go but down.

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