The volatility is at levels record neither more nor less because the data that the market is receiving are extremely confusing. The only certainty among financial analysts is that the uncertainty will continue. In other words, they are now more honest than ever. I doubt that HenryBlodget had failed to communicate this so honestly to your customers. (Blodget was an analyst at Merrill Lynch (NYSE: MER) who was famous in the last stage of the bubble internet for two reasons: predict Amazon (NASDAQ:AMZN) to $400 when it was worth half, hitting the next month, and terminate exonerated the industry by recommending internet stocks to their customers, at the same time describing them as rubbish in their private emails.) Up the SEC is realized and this could have marked the roof of the Internet age).
Reflects it the mood of investors. On the one hand there are a lot of very disappointing economic data, and on the other there are optimistic coming waves of Governments in Europe and United States, being launched to support the economy as first and only objective. An economy that tends to the recession, what drives stock markets down. But arriving quotes as low values, generate rounds of purchases with strong increases. The head of the Federal Reserve, Ben Bernanke said that a broad economic recovery will not happen right away, even if the markets stabilize now. Is the reading? Sell. Volatility today triples the average observed over the long term, and is five times higher in the years of strong stock market upward, in 2004, 2005 and 2006.
We are in an extreme situation, that recalls the worst cases to the crash of October 1987, or the oil shock of 1973-74?, said Eric Galiegue, director of the firm Valquant French finance consultant agency AP. But there is something else. Are hedge funds (hedge funds) that are massively liquidating positions, same in gold.