Sam Ro quotes Gerard Minack in Business Insider:
To summarize: 1) we’ve seen this before, 2) we think the slowdown is temporary, 3) we think significant weakness will trigger stimulus, and 4) we think fiscal austerity is now less likely.
Still, Minack is pretty sure this resilience can’t hold for too much longer.
Read more at Why The Stock Market Has Been Bulletproof To The Bad Economic News | Business Insider Australia.
If we are in the midst of a credit contraction,deleveraging from the private sector,and an unwillingness to spend from the corporate sector, add miners unwilling to expand projects,or indeed mothball brown field projects,surely this deflationary as you stated re the US dollar… ultimately in this global credit contraction, corporate and retail suppressed spending will hit China like an artic blast, ultimately leading to lower prices,and lower share markets…how in this environment,deflationary,which is becoming more evident each month…can the ASX or any other market,go any direction other than down ?
I believe this is a secular bear market. You will have rallies but the long term trend is lower.
P.S. Corporate sector credit growth has returned to trend, matching GDP growth. The problem is household credit.