This is from the ICYMI it file - an overnight report from Bloomberg
Julieta Yung, an economist in the research department at the Federal Reserve Bank of Dallas says relying on the equity market for economic signals is a mistake.
- Short-term fluctuations in equity prices come too fast and furious and are caused by such a multitude of inputs that assuming they'll directly translate into changes in real economic output is an error
- "The two can disconnect in the short-term because of the immediate effect sentiment has on stocks"
You're response might be "Well, d'uh" ... but apparently policy makers need to be told this stuff.
- "Then that nervousness wanes, and people capitulate, and that's when you see the market come back."
Yep. Sheesh.
More here from Bloomberg
