The Crash in Reverse

Today was a good day for the markets.  Investors apparently liked the government plan to buy toxic assets.  This, with some other positive news for housing and consumer sentiment that I mentioned in earlier posts, was good enough for a 7% jump in S&P.  Over the last couple of weeks, it rose by 21%.  So does this mean that the bottom is behind us, or is it a bear-market rally like we had from mid-November to the end of 2008?

Well, I am certainly not qualified to answer that question, and neither is anyone else.  The bottom of this bear market will be identified only when the next bull market is well on its way.  However, periods like these illustrate market’s ability to rally very sharply on good news, as well as importance of having a consistent exposure to stocks as opposed to jumping in and out of the market.  You don’t want and can’t afford to miss days like today .