It's All About The Economy

As we anticipated in our story last night, all the global markets were down 5%-10% coming into this morning when a first-time coordinated global interest rate cut was instituted by the Reserve Banks around the world. The result was a quick stock market turnaround to positive territory. This effort had the short-term result of improving the stock markets while also nudging the economic impact around the world.

However, a true flush out of the markets today might have been a better recipe to get the markets on a better long-term path. The rate cuts may be good for the economy but for the stock markets, it is all about the economy. We now have TARP, Lower Interest Rates, and Massive Liquidity Injections that will hopefully loosen the conditions in the credit markets but until signs of improvement in business is apparent, the stock market will not make investors happy.