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Tarp (troubled Asset Relief Program) Driving Up Dow


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HOLA441

http://www.marketoracle.co.uk/Article10886.html

It is worth reading the full article as it has some scary looking graphs and some interesting comment.

Fundamentally the rally in the broad stockmarket from early in March is viewed as being the result of a combination of media hype, wishful thinking and short covering, but there may be more to it than that - it would appear that a sizeable proportion of the TARP (Troubled Asset Relief Program) funds not thus far deployed have been used to drive up the stockmarkets in order to create a positive environment for the banks to issue secondary shares and thus raise equity. While this is perfectly understandable, it also means that once the banks have finished selling this stock to the public, or the market is simply exhausted by being soaked in this way, it is likely to go into reverse in a big way.

stock-market-25-1.png

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This is a good reminder of the fact that markets can go up and down even during the worst economic crisis since at least the 1930s.

From a technical standpoint, it does look like the "up" portion of the "ups and downs" has run out of steam after two months.

A nasty NFP report from the States on Friday coupled with the deteriorating technical picture might be enough to push us back into the "down" cycle of the "ups and downs".

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