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Sunday, December 5, 2010

The Bear Market That Wasn't...(Yet)

Bloomberg has an interesting article on how, despite seemingly bad signals for equities ranging from a slow economy to an entire continent teetering on the edge of disaster, the great bear market of 2010 didn't happen.

Many might think that this is a bubble or out of line by some measure, but the reason stocks have done well is that, fundamentally, they are quite cheap. That was what provided a good underlying bid for most of the year. That, and the fact that there are very few alternatives. You can earn almost as much in blue chip stocks just on dividends as you can on U.S. treasuries.

Now that this headline is out there, we are probably destined for a collapse, but at least it didn't happen in 2010.

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