On Oct. 25th, Jason Zweig discussed capitulation in his
WSJ column:
There's a belief that the market can hit bottom only when vast numbers of investors finally capitulate, throwing in the towel and selling off the last of their stock portfolios.
"The idea is, 'We'll know we've hit bottom when the fat lady capitulates,'" says finance professor Robert A. Schwartz of Baruch College at the City University of New York.
One could say the fat lady
has capitulated, and what she is resigned to is a President Obama in January. The market has slowly been coming to grips with this possibility since the summer, and this week seems to have all but accepted it as inevitable. What will happen after the election is anyone's guess, and what happens when the new President takes office is even harder to predict. But for now the selling stopped. Investors seem to have finally, if reluctantly, accepted what the polls have been saying since the identities of Presidential finalists became apparent.
