Here's the final industry breakdown for today's Dow at the close:
Basic Materials +0.48%
Capital Goods +0.16%
Cons. Cyclical +0.37%
Cons. Non-Cyclical -0.47%
This was the aftermath of a substantial sell-off with heavy volume. Now I know this is just one day, and I'm certainly no economist, but if you take today's changes seriously, doesn't this look like the beginning of a hard-asset bubble?
Let's hear from people who know (or think they know) about this kind of thing.
UPDATED BELOW THE FOLD ON 1/26/08!!
Apparently, someone who, unlike PhysioProf, ought to know what he's talking about is also concerned about the possibility of a hard-asset bubble resulting from further rate cuts:
The Fed action is not to everybody's taste. Stephen Roach, the head of Morgan Stanley Asia, was blue in the face from righteous wrath in Davos today.
"Policy-makers are reaching back to the same play book that created this mess in the first place. They're saying we are there to clean up after bubbles burst first rather than to prevent them. It's a dangerous, reckless and irresponsible way to run the world's largest economy."
"We have a market-friendly Fed injecting a lot of liquidity in the system which will set us up for another bubble economy. Excessive monetary accommodation just takes us from bubble to bubble to bubble."