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I suspect that the stock market is rising because the Fed is giving money to banks, who are loaning money to corporations, who are buying back their shares.
Is there any way to test this hypothesis, one way or another?
Looks like there’s some data here: 2024 Stock Buyback List - MarketBeat. You could correlate the companies that are doing buybacks against SEC filings data on debt loads, though probably not in realtime. The SEC filings might not be until quarterly results.
I think there’s a simpler hypothesis: traders are betting that the fiscal bailout that Congress is about to pass will cause a steep rebound in the second half of the year. Fear and greed aren’t rational, and the market is driven by them, and right now the pendulum seems to have swung to greed.
I follow a couple of technical analyst guys on Twitter who were saying that this rebound was going to happen this week almost regardless of the news. One, obviously mocking Wall Street, calls it “saving the quarter”.
I’m not sure I buy anything any technical analyst says, but YMMV.
Eh, Sven Henrich has been calling this since August. The fact is that the stock market and bond markets have been massively propped up via repo arrangements and outsized RBMS purchases for about 2 years now. There were no fundamentals which supported Dow 30,000, none.
Suppose that Trump’s re-election depends only on the stock market. Is there anything that can prevent his re-election if the Fed is committed to helping corporations buy back their shares?
Oh, I don’t disagree with that at all. That’s not really technical analysis; it’s fundamental, value-oriented analysis. Technical analysis is all the mumbo jumbo I see showing up on my google news feed all the time about death crosses and support levels and prices crossing their 200-day moving averages, etc. I try my hardest to ignore all that.
Sven does both, that I cannot deny. The man loves his charts.
Let me revise my statement: I don’t trust anything a technical analyst says, if he’s basing it on technical analysis. 
If the stock market goes up much further, not only would I be surprised, but I’d be calling it what it is: opportunistic, short-term trading. Buying on the upswing.
There’s no fucking way any “real” investing is going on right now except in a very limited number of businesses. Amazon might be one. Some health-care related companies. But across the market? No way. You’re a sucker if you believe otherwise.
I would grudgingly agree with Trump/MAGAbots that the stock market isn’t necessarily on its way to a nosedive just yet. A depression isn’t inevitable just yet. And yes, the stimulus, flawed though it might be, is a relief for markets - agreed on those points.
But we’re nowhere near the end of this, and if you want to get a sense for how bad things can get, both in terms of public health and the economy, just keep your eye on the White House’s response.
If they take it seriously and can keep the Mango Mullah locked up in a basement long enough to stay out of his own way, then there’s a chance we get past this by late summer.
If not, if he and republitards double down on an arbitrary deadlines, pushing businesses and other institutions to act on impulse, we’re fucked - probably for years to come.
The Times had an article today on buybacks. They have pretty much stopped due to both political and economic reasons. I think they are banned by the latest stimulus deal.
BTW, an index of companies doing buybacks shows that they fell 42% in value versus 34% for the S&P as a whole. Didn’t say why - maybe because the buybacks tended to overvalue the stocks?
Most of your posts in this thread are nothing but a combination of partisan hackery and meaningless statistics. Anyone with any knowledge of financial markets know equities are volatile in the short term.
We might have a global depression. It’s not going to last 10-15 years though. If you can’t afford downturns in stocks you can’t afford to own stocks. That’s all this is. From a financial point of view.
Anyone with a knowledge of economic history understands that Republicans suck at managing economies. You can find this out via a review of our national accounts, a history of stock fluctuations, a history of the nature and causes of America’s post Civil War recessions, by almost any method which goes beyond conservative faith-based economics.
Call it partisan hackery all you want, the numbers and history just don’t lie.
Stock market means what exactly? Your spin is blatantly false and partisan.
As long as productivity and innovation grows, which it has during both parties’ time in power than the economy is improving. I don’t know about you but the powerful computer I’m typing on is vastly better than the computer I had 20 years ago. THAT is one of the real indicators of productivity and progress.
The market capitalization of Apple is not.
Now, ownership in corporate entities is wise in the long term not the speculative short term which you are inappropriately fixating on for reasons known only to you because in the long term the economic growth of a large, stable, powerful nation such as the US is almost guaranteed to continue barring a planetary threat such as a large comet. At which point NO mechanism of investing is likely to be beneficial.
So instead of contributing to folks’ anxieties about their investments and their financial security with dangerously misleading statistics of short term metrics why not do the right thing and present actual useful facts.
I think we’re seeing a dead cat bounce on the way to another leg down.
Just posting to see if I’m right.
That’s my guess as well. We shall see.
Right now - and yes it’s a WAG - I’d probably assume that the stock market value this morning is in relatively close proximity to its real value — pre-January. In other words, the recent nosedive has, to some degree, more accurately priced in the stock buybacks, the tax cuts, and the “value” of Trump’s Red Bull energy drink policies. The sugar high is now over.
What it hasn’t priced in yet is unemployment and a collapse in economic exchange. Stimulus will, to some extent, for a limited time, keep that fresh pile of turds buried in the kitty litter, but only for so long. In a few weeks, we’ll not only still see this shit, but the maggots as well.