Business & Media Institute
Saturday, September 12, 2009
The Dow Jones Industrial Average (DJIA) has climbed nearly 45 percent since hitting a March 9 low. The S&P 500 (S&P) is up nearly 53 percent. And the NASDAQ (NASDAQ) has soared a whopping 61 percent since the March bottom.
But that rally has some analysts shaking their heads. Art Cashin, a CNBC regular who also makes frequent appearances on CBS and NBC news programs to offer insight on the financial markets, was skeptical on Sept. 11. He told CNBC’s “Squawk Box” he got some of his money out of the market and got burnt, but is still scratching his head over the rally.
“Away from that, I’m still somewhat skeptical about this,” Cashin said. “I’ve been wrong, got out too early, certainly. I took some money off the table as I told you, about a week and a half, two weeks ago. Didn’t take it all off, um, may take some more off if they keep going.”
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However, Cashin, the director of floor operations for UBS Financial Services and a long-time veteran of the New York Stock Exchange, also said the current market is very much like the stock rally that led up to the Oct. 19, 1987 “Black Monday” crash.
“There’s just some eerie things about this. It’s reminiscent, believe it or not, of spring and summer of ’87, when nobody believed the rally and it kept going up, despite skepticism,” Cashin said. “People shorting into it – it ate them alive until it suddenly turned. And the two topics that year were the dollar and Iran.”
The Dow took a 23-percent swan dive that day and Cashin explained this current rally is similar because the stock values have nothing to do with the underlying fundamentals.
This article was posted: Saturday, September 12, 2009 at 4:54 am