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Wednesday, August 26, 2009

A financial world gone mad

The Dow slipped a bit yesterday – only 39 points. Everyone is watching. They want to see how far this rally carries on. Many think it is more than a bear market bounce; they think it is for real.

The prevailing opinion is that quick action by the feds avoided a more serious meltdown. Ben Bernanke says he was working to prevent a “second Great Depression.”

And now that the crisis is past, the economy is slowly climbing out of its hole. The second quarter showed GDP falling at 1% per year in the United States…rather than the 6.4% rate recorded earlier in the year. Housing sales have perked up. Oil is trading above $71 – a sign of renewed economic activity. And gold seems to be getting ready for another assault on the $1,000 mark – a sign of growing inflation pressures.

At least…that’s the way the world sees it.

Here at The Daily Reckoning, we look…we squint…we wipe the fog off our glasses and try to tear the scales off our eyes. What do we see? We see a financial world gone mad.

-- from "A Financial World Gone Mad" by Bill Bonner

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