After being down all night, stocks erased the losses. But moments ago, the Case/Shiller index was released, and it showed that real estate prices are dropping again! Stock reversed and went red again!
Personally, as long as the Fed continues to print ad infinitum, Wall St will think of the Fed as god and will continue to shrug off all economic bad news! I expect that even this drop will be short-term and temporary! There is no longer any perception of risk on Wall St, and this only leads to moral hazard, more bad behavior, and more asset bubbles! It only sets us up for more trouble when the news can no longer be ignored!
