This vision was just but well ahead of his timeThe substance of the Constitution is upheldThis is why a partnership with the France here However I deplore the mixture of genresFraud are recurring exceptions in tradingIt is against this sum be compare savingsI am not of the opinion that less paid betterIt has inevitably become an affair of StateOr an edge of Highway a plant or an understoryAt the time they are more likely to cooperate to make warThe month of January has been terrible for stock investments. Correction was to the extent of despair which won this summer, one of the most severe financial crises of the post-war period, little by little investors after the collapse, the so-called "subprime". But the worst is never safe. The last week of January was the best for the Dow Jones index since mid-March 2003. The planet's most watched indicator indeed took more than 4, while the US economy appears more or less entered into recession. The Manager often misunderstood these days for this dramatic relief is well known: the Federal Reserve.
By lowering a significant basis total 125 points the federal funds rate, reduced to 3 in nine days, the US Central Bank has shown its determination to combat the crisis and to strive to standardize market conditions. The pace adopted by the Fed is "prestissimo", told in Natixis. "The Fed has reason to try to cause a shock to restore confidence and put an end to the decline in the price of at least an asset." If it cannot do much against that of the prices of homes (it must absorb the surplus stocks in advance and that the "subprime" problem becomes less burdensome, in other words must await the end of the year at least), it may attempt to stabilize the actions. "They always receive an attractive valuation and should be, as profits, a little less sensitive to the cycle of business," explains in Natixis.
The Fed's example could be followed by the Bank of England as early as this week. The activism of Ben Bernanke and his peers is that they have the means to make an episode limited in time and contained intensity of the current downturn.
"Identify the low point.
Would if that were the case, the risk of contagion to other regions of the globe be minimized providing beautiful opportunities for diversification of their portfolios of stock investors. As much more than this asset class has become really cheap. Valuations of the & S P 500, broad Wall Street index, represent just 12 times about the upcoming benefits anticipated by the consensus of analysts. Which was never produced for twenty years at least, as before, the consensus was not calculated.
"Identify the low point of the market becomes the main problem of the year", believe the strategists at Lehman Brothers. For them, this floor level has indeed been reached. The S & P 500 has already dropped "of 15, which corresponds to the average percentage of decline in previous recessions", say. Only the two crises of 1973 and 2001 to were unsuccessful frankly more catastrophic busts. But, at the time, emphasize the business bank specialists, the two cycles had been punctuated by very expensive valuations. And yet, two cycles of recession previous, the Fed has been able to accelerate the formation of a trough in the equity markets after successive flexibility of monetary policy by 180 basis points in the first case and 475 in the second.
Of unknown size
However, in this cycle, the US Central Bank reduced the the federal funds rate of 175 basis in four time since mid-September. About the benefits of the fourth quarter of US companies, they compare their quality with those of the most prosperous quarters. According the last score of Raymond James published Friday, 64 of the 277 companies belonging to the index S & P 500 who presented their quarterly accounts, reported higher expectations, 11.6 consistent with the average forecast and 24.5 below them. Disappointments come almost exclusively from financial institutions, victims of the crisis of the "subprime". This segment of the rating continues to blow a chill wind markets. Goldman Sachs estimated that approximately $ 60 billion the cumulation of the impairment of assets in 2008 of us banks as a result of this crisis. Despite good technical indicators, of unknown size remain. "The market psychology plays a major role." "In these troubled times, we must keep cool heads and avoid to be taken by the euphoria or panic" wisely reminds Sebastian Paris-Horvitz, Director of strategy at AXA Investment Managers. Nevertheless, in the short term, "the combination between a generally pessimistic sense and the fact that the markets already enjoy a high probability of recession will support the continuation of the recent rebound," consider the strategists at Deutsche Bank. If this remedy is not likely to develop into a lasting phenomenon, "the current levels of development may be be an entry point for investors who keep their positions more than a year", they complement.
