Yesterday I commented on some Main Stream Media reactions to Tuesday's big break in stocks.
Today the New York Times published an editorial entitled "After the Sell-Off".
The Times tells us that yesterday's rebound "..was as troubling as Tuesday's rout". Underlying economic conditions in the USA are dangerous, they say. "The torrent of bad news on housing is only worsening.....manufacturing has already slipped into recession". And then there is this: " In recent year, as housing and stock markets have surged, ...highly speculative investors have been enouraged to an unusual degree by their bankers and regulators....[in their maniacal] excessive risk taking."
The Times concludes, "The next crisis appears to be building around weakness in the United States......Tuesday's stock market decline could turn out to be a garden-variety correction. But major market participants would be wise to rethink [this] assumption."
It is unusual for the Times to comment so directly on stock market action in an editorial. I think we can fairly conclude that the Times continues to view the US econonomy and stock market in very bearish terms. As I pointed out yesterday, the Times is a reliable fade. I think this editorial is telling us that the reaction which started last week is closer to its end than to its beginning and will be followed by new highs within a couple of months.