Wednesday, April 29, 2009

Is recovery on the way?

I am sure this is on many people's mind right now.

My answer is maybe. The real bottom, I guess, would be reached this quarter. It is going to be a seesaw. Consider these:

  • The stock market a few weeks ago started inching up, so are the prices of commodities including oil and others.
  • Many analysts upgraded their outlook on bank profits. Indeed, no recent or imminent bank failures were seen on the horizon the past few weeks.
  • Consumer spending has risen by 2.2 percent in the US.
  • Hundreds of billions of bailouts will start streaming its way to the economy by way of infrastructure projects in a month or two.
  • Retail sales and orders by manufacturers seemed to have stabilized in the US.

All things considered, including swine flu, my guess is, the world recession will be over in the third or fourth quarter.

A march to recovery will be in full swing by next year, and the stock market would recover, earlier than I predicted.

I know this is very optimistic. But the signs and indicators show that the bottom would be reached or would be over by summer depending on how you assess and interpret the information around.


Be wary, be careful, and trade at your own risk. Good luck.