By John W. Lillpop
At the close of business on November 20, the Dow Jones Industrial Average (DJIA) stood at 7,552 after another dreary session.
At 11 AM on November 25, the DJIA was 8,505. In just three trading sessions, Wall Street has rallied for over 1,000 points!
What produced this remarkable turn around and does this mean that the depression is over?
Several factors seem to have converged over the past several days to give Wall Street traders a reason to buy back into the market:***
*Obama's Epiphany on Taxes
Obama has all but declared his plans to tax the rich as dead, at least for the foreseeable future. Wall Street does not like higher taxes. (Other than liberals, who does?)
*Economic Team Announced
In announcing that Timothy Geithner will be his Treasury Secretary and that well-respected Larry Summers will also be on his economic team, Obama sent a signal to Wall Street that he intends to put the best minds possible to work on the economy, despite ideological burps. Larry Summers' innocent comments about women while at Harvard and the petty reaction by feminists were ignored in order to apply Summers' skills and expertise to the task at hand.
*More Bail Out Fever
The Sunday night massacre of U.S. taxpayers by the Bush administration continued as Henry Paulson and his cohorts threw an additional $20 billion at Citigroup. That bail out/massacre caused Wall Street to rally on Monday as one of their own was saved at the expense of the unwashed masses (taxpayers).
*Plans for Credit Cards, Auto Loans, Student Loans
Uncle Sam announced that he is working on a program to aid companies that issue credit cards and make auto and student loans. More good news for Wall Street although the average taxpayer will probably get soaked once again.
The bottom line: No tax increases, good people on Obama's economic team, and more government bailouts have driven the market to a 1,000-point gain in three sessions.
Will the trend last and continue? We will find out sooner rather than later!
***Source:
http://www.msnbc.msn.com/id/3683270/
