The US stock market just finished its best quarter since 1939. You may remember that for much of this year naysayers have been chanting about doom, gloom, and the coming “double dip” recession. You will find some of our firm’s forecasts here and here. But yesterday’s news – you remember that two years ago we had unimaginable turmoil in the financial markets:
September 13/14: Lehman Brothers fails to find a buyer and stave off collapse
September 15: Lehman files bankruptcy and Merrill Lynch is sold to Bank of America to avert collapse
September 16: Giant insurer AIG gets a taxpayer-funded bailout from the US Federal Reserve Bank
September 28: Largest US bank failure as Washington Mutual collapses under bad mortgage loans
September 30: A proposed $700 billion financial system bailout teetered after its rejection by the US House of Representatives
Of course, two years ago today we were still months from seeing the stock market (which was down 23% from its summer 2008 high) plunge an additional 40% by March of 2009. GM and Chrysler had not yet filed for bankruptcy protection. It tires me just remembering how bad things were in our financial system at that time.
The pendulum of the financial markets swung far over to a bad place. Two years later it is still swinging back.
(This article contains the current opinions of the author but not necessarily those of Brighton Securities Corp. The author’s opinions are subject to change without notice. This blog post is for informational purposes only. Forecasts, estimates, and certain information contained herein should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. References to specific securities and their issuers are for illustrative purposes only and are not intended and should not be interpreted as recommendations to purchase or sell such securities).