The oh-so-rational stock market

Dow jumps 200 in opening minutes
By MADLEN READ, AP Business Writer
18 March 2008
NEW YORK - Stocks rallied Tuesday as investors, relieved by better-than-expected results from Lehman Brothers and Goldman Sachs, also anticipated a massive interest rate cut from the Federal Reserve. The Dow Jones industrial average surged more than 200 points.

And what were Lehman's "better-than-expected results"?:

Lehman profit falls 57 percent

Meanwhile, in the real world:

Prices up, housing contruction drops
By MARTIN CRUTSINGER, AP Economics Writer
18 march 2008
WASHINGTON - Wholesale prices rose again in February as another hefty increase in energy costs offset falling food prices. Outside of food and energy, prices shot up at the fastest pace in 15 months.

In another sign of troubles in housing, construction of new homes fell by a larger-than-expected 0.6 percent in February to an annual rate of 1.065 million units.

Okay, to be honest: I expected the stock market to go up yesterday. There's an argument to be made that investors ought to keep pouring money into stocks, even if the economy goes down the tubes... sort of a self-insurance policy, maintaining the market's value. The strategy works so long as no one wants to make a withdrawal!

Note: If I knew the future, I'd not be working for a living!