Saturday, July 23, 2011
How Do You Spell R-e-l-i-e-f?
July 23, 2011
The only real four-letter word on Wall Street is fear. When it's reduced, the market's tendency is to go higher, maybe fitfully, maybe in a straight line, but up.
Thursday's 109 billion-euro ($157 billion) aid package from the European Union and International Monetary Fund to a bankrupt Greece kicks the can so far down the road that markets can stop worrying about a potentially widening debt crisis emanating from that small nation any time soon.
Global markets rallied last week, up about 2%. More gains seem likely for the next few months. Though September and October are typically tough months for stocks, they might not be so scary this year, assuming the U.S. government eventually reaches an agreement on its own debt- and deficit-reduction program, which we're assuming it will.