Holy Toledo, smallcap stocks were up 6.1 percent on Thursday. That's equal to a nearly 500-point increase in the Dow. In Barron's recently, Pinnacle Value Fund's John E. Deysher explains what might be going on.

Going into recession, small-caps lag because customers and vendors concentrate their business on larger firms that are more likely to survive. Going into recovery, however, small-caps generally do better than big-caps because customers and vendors feel they might get a better deal with more companies in the mix. Depending on the strength of their conviction that the recovery is real, stock prices can pop almost immediately. Any whiff of good news could trigger a rally.

Posted by Jay Hancock at 8:00 AM | Permalink | Comments (0)
Categories: Stock Market
        

very nicely. The change by the Financial Accounting Standards Board in how banks can value illiquid securities is basically a back-door way of relaxing capital requirements. Sez Megan:

A perfect regulator in an ideal market would relax capital requirements in bad times, and raise them in good times. The actual regulators we have, however, are terrified of spooking the markets if they do so--and more importantly, terrified of the all-out political war that would follow. So we lower capital requirements in good times, when all that capital seems like an untouched gold mine, and leave them stat, or raise them, when everything's going to hell. FASB, which is pretty insulated from political pressure, is doing what it can to correct that problem.

Posted by Jay Hancock at 5:26 PM | Permalink | Comments (2)
Categories: Stock Market
        

Barry Ritholtz says: "There's a big bear market rally coming" and "It's too late to sell."

Marc Faber says that: “Equities could rally between here and the end of April" and that investing in stocks now will be profitable over the next decade.

Doug Kass is "espousing a more bullish opinion on the U.S. stock market" and suggesting stocks hit a bottom last week.

Steve Leuthold, who runs the bearish Grizzly fund, says: “I personally would not have an investment in the Grizzly fund because I think we’re so close to a major market bottom. “Every investor ought to be considering putting money into equities.”

Bill Fleckenstein is "starting to build a shopping list" of stocks like Microsoft, Pepsi, Cisco and Johnson & Johnson that he might buy.

All these guys have been very, very bearish. But they also know stocks can't go to zero.

Posted by Jay Hancock at 10:37 AM | Permalink | Comments (0)
Categories: Stock Market