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January 23, 2008

stock market….

Filed under: Economics — Fei @ 11:31 pm

The stock market is so volatile these days… and I have my own thoughts on its direction… although I know the market is unpredictable… any prediction is meant to be wrong… (and especially for an armature like me…) I just want to find a way to laugh at myself…

so here is how I’m going to laugh at myself… and maybe the day is tomorrow…

the stock last Tuesday is at the low side for the next couple of months… the reduction of the overnight interest rate will temporarily boost the market… however, the underline problem is not solved… the inflation may become more of an issue in the middle of the year… sub-prime mortgage will still be a risk… more defaults may be seen around May…. the stock may reach new lows around May to July period. The economy in the second half of the year depends on the spread of the recession. A recession is likely to occur… If the possible recession is limited to US, which means China, India and most part of Europe will still have mild growth, the US economy will go out of this dip close year end, or beginning of 2009. Bush’s 150B dollar tax rebate may see some effect in consumer spending around year end. If the recession is more wide spread… assuming the other countries will have a delay of a quarter to half a year… the economy won’t make turn until the second half of next year… overall, this recession may be just a light one… it’s impact to semiconductor industry may be mild to moderate… however, even after the recession, the US economy may not enjoy the same growth as the past few years… as the internal issues of the economy cannot be overshadowed and thus post a greater threat…

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