The jobless rate was announced today. It has climbed to a 16-year high of 7.6%.
Bizarrely, the stock market rallied on the news, and is currently up almost 3%, apparently on the mistaken and deluded belief that this means the stimulus will pass and thus everything will be happiness and light soon.
The stock market had the same disconnect from reality in the early days of the subprime and credit crisis. It defied gravity and logic for quite a while. While it’s certainly true “the markets can stay irrational longer than you can stay solvent”, reality eventually always does intrude.