Part of the reason Money Daily ceased publishing on a daily basis last year was because of the total ad complete idiocy of markets which have given up control to the Federal Reserve.
Today was another shining example of the absurdity of that proposition, but, fear not, Money Daily will be here tomorrow, next week and on into the future, boldly going where no central banker has gone before.
Prior to the opening bell, the government announced retail sales for the month of February, which came in at a -0.6%, marking the third straight month of declines in retail sales, the worst such string of misses and losses since the collapse of Lehman Brothres back in 2008.
Add to that, on the back of the government's stress tests on capital formation for the largest financial institutions, these big money centers announced upwards of $55 billion in share repurchase plans, led by Morgan Stanley, which announced a repurchase plan of $3.1 billion of it own stock. Remember, stock buybacks serve one purpose: to decrease the number of shares outstanding, which makes the EPS look better by comparison to either the prior quarter or the prior year. Beyond that, there is only a little - questionable - reasoning for such moves in a business sense.
The response to what can only be described as negative news, was a galloping rally right out of the gate for all indices and just about every momentum stock, income stock, growth stock, tech stock, tick tock and sock puppet.
There's no bubble. Uh-uh.
The whole concept here is that if the economy is weak, then the Fed may delay raising interest rates, with the Federal funds rate currently - and for the last six years - sitting at ZERO. The Fed has hinted that they'll raise rates in June, probably by 25 basis points.
That's what has Wall Street all riled up and excited. Imagine if we actually had a functioning economy.
Dow 17,895.22, +259.83 (1.47%)
S&P 500 2,065.95, +25.71 (1.26%)
NASDAQ 4,893.29, +43.35 (0.89%)