Matthew Lynn: why I think this rally will run and run

Matthew Lynn belives the doubters are wrong. The stock market rally is real. Quantitative easing will have two consequences, both of which will be good for equity prices.

Seldom can a stockmarket rally have been greeted with such universal scorn. As shares around the world started to show some signs of renewed life, they were met with a chorus of boos and catcalls. All the usual caveats were duly trotted out. Sucker's rally, they said. A bear market blip, warned the chart-wielding experts. Nothing more than a dead cat bounce, declared the sages. From the disdain heaped upon what was in fact a modest recovery, you'd think most people want the stockmarket to remain flat on its back.

Actually, they are dead wrong. The rally is real enough. There are plenty of good, solid reasons for stocks to start climbing again, and the investors who get behind it will do just fine. There is just one snag. The recovery is taking place for all the wrong reasons.

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Matthew Lynn

Matthew Lynn is a columnist for Bloomberg, and writes weekly commentary syndicated in papers such as the Daily Telegraph, Die Welt, the Sydney Morning Herald, the South China Morning Post and the Miami Herald. He is also an associate editor of Spectator Business, and a regular contributor to The Spectator. Before that, he worked for the business section of the Sunday Times for ten years. 

He has written books on finance and financial topics, including Bust: Greece, The Euro and The Sovereign Debt Crisis and The Long Depression: The Slump of 2008 to 2031. Matthew is also the author of the Death Force series of military thrillers and the founder of Lume Books, an independent publisher.