That’s the question on investors’ minds right now: Does this stock market rally have legs?
Let’s set aside the obvious answer - no one knows - for a moment and consider what many investors simply refuse to believe: That we’ve seen the market lows.
Why are so many skeptical on this count? Because virtually everything they see and hear tells them the economy is going to get much worse in the months ahead.
And they’re right. It will.
* The economy is losing 600,000 jobs a month.
* The banking system remains dysfunctional.
* Real estate is mired in quicksand.
* Retail spending is anemic - and still falling.
* And consumer confidence is at record lows.
It doesn’t take Isaac Newton to see that the economy will get worse. If there were a direct correlation between the economy and the short-term direction of the stock market, we would know just what to do with our money now.