Stocks attempted to rebound after yesterday's drubbing (178 point drop for the Dow), but the Philadelphia Fed Index came out for June at a -7.7. That was a huge miss, and is a big drop from the May number of 3.9. In March this index was at 43. Wow.
Stocks had been up slightly, with the Dow advancing about 35 points just prior to this report, but as soon as the number was released, we went negative. The S&P 500 and NASDAQ are both lower, and the Dow, which went negative at the release, is bouncing around the flat line.
We still have more data to come this week and the problems in Greece persist. Investors (speculators and traders), seem to forget about all the problems in Europe and with Greece in particular, and rally stocks back up each time we get a sell-off. Big mistake, as we saw what happened yesterday, after traders ran stocks up on Tuesday.
Greece is effectively in default on their national debt. I think they will get the money they need to keep things moving forward, but they will never be able to pay-back this money, ever. Ireland will also never pay back what they owe. Portugal will never pay-back what they owe. More importantly, these governments are basically Socialist, and the give-away programs that citizens in these countries have become accustomed to, that they have known all their lives, are simply unsustainable. Although this is a fact, these governments are going to find it extremely difficult to change the entire cultures of their countries, as we see so glaringly, with people in these countries throwing rocks at police and protesting en mass. This is not going away, and investors should keep these problems in mind when making investment decisions.