The inevitable happened yesterday, when the Congressional Budget Office announced Social Security was starting to bleed, i.e., that payments out exceeded payments in. That is not good economic news.
In addition, they announced the deficit for this year will be $1.5 TRILLION instead of $1.1 TRILLION. That is not good economic news.
And, Standard & Poor's reduced the credit rating for Japan, as their debt increases. That is not good economic news.
But, did you notice the stock market is at two and a half year highs? The Asia markets were up overnight, and the European markets are up now. So, the Dow will probably break above 12,000 today and stay there. Maybe, the markets don't listen to economic news?
Or, maybe, the stock market is looking down the road to a normalized economy. They may feel stocks are cheap, compared to 2007. Or, maybe, the stock market is about companies who are very healthy, not households who are sick but healing.
Or, maybe, the 24/7 jackrabbit economy has gotten too far ahead of the tortoise economy again and needs an old-fashioned correction, which I believe.
