Dead cat bounce...

Bernanke’s Dead Cat Bounce

Way back in 2008, Michael Maloney, in his book, Guide to Investing in Gold and Silver, described the economic scenario he thought most likely to come to pass. Here’s an update: it’s playing out right now!
Michael opined that U.S. Federal Reserve Chair Ben Bernanke, spooked by the specter of deflation, would over-react by inflating the currency supply—which Bernanke has done­. In a November 2008 video, Michael said Bernanke’s bailout of the banks would cause the stock market to bounce back, led by the banking sector. That’s exactly what happened.
In 2009, Michael wrote an article entitled “How High Can A Dead Cat Bounce?” The title referred to an old stock traders’ saying, “Even a dead cat will bounce if dropped from a high enough point.” Mike believed then, and events are proving him right, that the 2009 rebound in the stock market, which most people pegged as the beginning of a recovery, was in fact nothing more than a dead cat bounce.
“If something is really over-valued when it pops, it goes down in a crash,” Mike explains. “Then investors come in, chasing yesterday news, thinking they are scooping up bargains. What they are really doing is causing the market to bounce.

Link:
http://wealthcycles.com/blog/2010/12/08/he-knew-then-what-we-know-now