Out of context it might be reasonable to assume that a bounce back up to last summer's highs are a real possibility. OK but:
(A) The US economy is largely recognised to have been either in or very near recession in Q1.
(B) Q1 earnings reports are nigh.
(C) The Russell 2000 is currently sporting a dividend yield of 1.42%. (Umm, that's less than inflation folks)
(D) The credit markets are still in disarray and are shrinking.
(E) Property prices *are* falling. The credit crunch isn't just some ethereal event occuring in financial cyberspace, it's affecting 'Real People, Right Now'(TM).
The latest tick upwards in the markets is interesting but certainly not yet outside of 'control limits', for me alarm bells are not ringing. IMHO this is about as good as it gets as far as shorting or put option buying opportunities go, we're certainly not going to be seeing rising profits from ^RUT companies anytime soon + a continuing recession seems very likely indeed + stocks are still overpriced despite the fall from 2007 peaks. The recent move upwards has simply put some juice back into shorting opportunities.
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