Running on Fumes
The stock market blasted higher, with the Dow crossing the 14,000 mark because the jobs report came in well under expectations. In today's world, one follows the other.
In yesterday's world, the one where logic and reason ruled the day, that first sentence would not have been written. Economic weakness would not have been rewarded with a big surge in stocks.
But this all makes perfect sense in today's world, once you tilt your view to the "new normal" and get with the program.
I titled this piece 'running on fumes' because, in one very real sense, that's exactly what this current market is doing. The fumes in this case happen to be thin-air money that the Fed is injecting into the financial markets to the tune of $85 billion per month, or roughly $4 billion per working day.
When an engine finally runs out of gas and turns to fumes, the last act of that engine is to run really hot – to race for a while – before finally quitting.