Over the past few weeks, every one has filled with two kinds of market sentiment, a more optimistic on growth, and another expressed concern on inflation. Worried about inflation, they should limit the policy space to stimulate and trigger a stock market decline. These two emotions in a different direction of the market changes. However, those who hold these views will be two groups of different people. They stuck to their guns, choose a different investment decisions. Stock and commodity markets, is being staged in 2007 when the dazzling scene.
Fed dilemma
No matter how investors and speculators to prove himself more than to see how a reasonable market, the real driving force behind them is the "animal spirit", or "bloody." Worried about more than a year after, these people can no longer sit still, decided to return to the asset markets. Then, rising prices and encourage more people to enter the market. Various theories began to surface that the trend of the market this is correct. Because of the rising trend in the global market has been as long as three months, and even in China has continued for seven months, even the most timid person can not help but want to join the army to intervene in the market. When news of the least well informed, are most vulnerable to stock market investors rely on others,
Usually indicates that the trend of the market rose to a Hom. If the economy continues to grow, incomes rise, more funds will be heated to the market. However, the global economy to slow growth for many years. Strong economic growth will not increase in the current after the stock market. This is a bear market bounce. Now jump into the people, will incur heavy losses.
In the past three weeks, the dollar weakening, crude oil prices and the U.S. Treasury interest rates. These price fluctuations, is a typical performance of investors worried about inflation. What they are concerned about inflation, policy-makers around the world make the situation more complicated. Especially in the United States may be in trouble. Expansion of the federal government to implement fiscal policy, the Fed injected liquidity, which is to support economic recovery in the United States twin tools. In 2009, the U.S. budget deficit could be two trillion U.S. dollars, accounting for about 15 percent of GDP. This will allow the federal government debt outstanding to add a third. With such a large debt, the need for a thriving bond market to absorb.
If the bond market downturn, the United States government bonds surged to cause serious problems.
