The events surrounding Bear Stearns and its hedge funds have rippled around Wall Street this week and the market has suffered. Ironic that one Bear may be ushering in a much bigger and more ferocious one.
I have posted the 1 year chart of Bear Sterns and S&P below:
It is interesting how the "Bear" and the Bull - after moving together for so long diverged so wildly in mid-April, amongst an PR earnings blitz and foreign investment splurge orchestrated by Bear Stearns buddies - the other investment banks. Once mid-May hit, this divergence gave way and the two have started to move together once again. However, if this were to ripple throughout the industry - causing "The Great Unwind" or something not as spectacular, it would be hard to notice that at a 6 month window Bear Stearns is on a ugly downtrend while the S&P may be about to turn over - 6 months later:
Regardless of the outcome, it should be interesting to see how this all plays out.
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