Short Squeeze: Could Hang Bears on Ropes

Posted by Rick Ackerman

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Say one thing for DaBoyz, they have infinite patience to wait until things turn their way, as things nearly always do. Stocks had been grinding sideways for nearly two months, but yesterday the prop-desk provocateurs instantly transformed the picture to their liking, goosing the broad averages into a powerful short squeeze that could keep the market buoyant for the remainder of the year. What was most impressive about this feat is that it leveraged some employment news that wouldn’t have elicited so much as a yawn in the good old days. Supposedly, the private sector added 93,000 non-farm jobs in November, up from 82,000 a month earlier. This is surely better news than we’ve grown accustomed to, but it is not good news per se, especially considering that jobs would have to grow at several times the current rate for nearly a decade to replace the estimated eight million positions lost to the Great Recession.