Oct. 13 (Bloomberg) -- U.S. stocks staged the biggest rally in seven decades on a government plan to buy stakes in banks and a Federal Reserve-led push to flood the global financial system with dollars.
What happened then? The 14th of October the markets went slightly down. The 15th of October, the markets dropped about 10% and give back all the gains from the 13th of October.
The Standard &Poor's 500 Index rebounded from its worst week in 75 years with an 11.6 percent advance, its steepest since 1939, and the Dow Jones Industrial Average climbed more than 936 points.
Flashback on the 1st of December 2009, when Dubai World was defaulting on its interest repayments, I wrote:
[A] note to all those that think that "markets overreacted" and that "Dubai World's liabilities are so small": the problem is not in my opinion that the liabilities are small or not. It's rather that it just confirms to those who thought the worst is over that they couldn't be further from the truth. It's now time for the sovereigns to default.
Now, back in 2010, Sunday the 9th of May, the ECB and the UE announce a $1 trillion bailout plan for the sovereign countries. By doing so, the ECB acts illegally. So was Hank Paulson in 2008. It doesn't prevent them from doing it...
Monday the 10th of May, the European markets soar by 8 to 12%.
Tuesday the 11th of May, the European markets drop slightly 1-2%.
Does it mean tomorrow we'll have a repeat of what happened in the US?? And a massive 8-9% drop? Or will we have to wait a few more days/weeks to get it?