There are some days I just sit back and am baffled. Today was one of those days. You would think after days upon days, weeks upon weeks, and months upon months of this stuff, you would get used to it. No, not the case. Certain days I still just shake my head. Today GDP got revised down from 3.5% to 2.8% growth. That is a 20% reduction for the math whizzes. SUBSTANTIAL!!! Yet the market is well above where it was when that 3.5% print sent the market running higher. The market blinked but shoved off the news.
Than it became official that the FDIC, the agency that supposedly "insures" the deposits for the American population (insert trumpets here), is officially insolvent. They have a negative 8 billion dollar hole. Months ago this was inevitable and I would have thought the markets would have not liked that news at all. Well not only did it happen (when most people I was arguing with said it would not happen) but it was mostly ignored. Does the fact that the insurance system of the biggest most powerful country in the world is insolvent not say something with how sick our financial system is? Think about that previous sentence for a second! The FDIC is begging small town mom and pop banks for three year insurance fees in advance. Is there something wrong with this picture?
Now both of these news items didn't really come in as a surprise so it should have been priced into the market but that is the thing. The market isn't pricing in any of this it appears. It just continues to ignore and ignore and ignore.
Extend...pretend....extend...pretend. If it only it worked for everyday Americans when one loses a job, a bill that can't be paid becomes due, or one is kicked out of their house. Just close your eyes and extend...pretend...extend...pretend. Did it work?
Wall St. has taken the Dory approach from the movie Finding Nemo. Just keep swimming just keep swimming, swimming swimming, just keep swimming.