# The Serious Stock Market Crash Thread



## Toro

The other thread has turned into the usual mindless political hack garbage. This thread is to discuss the stock market crash without blaming everything on Republicans or Democrats by people who barely know the difference between a stock and livestock. 

The UK has fallen 12% in 5 days. Switzerland has fallen 17% in 2 weeks.


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## KissMy

Wait for another Euro bail-out.


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## JWBooth

Toro said:


> The other thread has turned into the usual mindless political hack garbage. This thread is to discuss the stock market crash without blaming everything on Republicans or Democrats by people who barely know the difference between a stock and livestock.
> 
> The UK has fallen 12% in 5 days. Switzerland has fallen 17% in 2 weeks.


And the Asian markets?


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## strollingbones

i am being told to hold and wait.....i cant wait to see the august statement but i dont think it will reflect what has happened....i am not sure what the close date is for the august statement...


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## strollingbones

i believe the japansese market tanked too


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## JWBooth

I see gold us up five bucks overnight,


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## martybegan

Toro said:


> The other thread has turned into the usual mindless political hack garbage. This thread is to discuss the stock market crash without blaming everything on Republicans or Democrats by people who barely know the difference between a stock and livestock.
> 
> The UK has fallen 12% in 5 days. Switzerland has fallen 17% in 2 weeks.



In my opinion a market drop like this is just like an industrial accident. Its usually not just one thing, its a cascade of "failures" that leads to it.

The poor finanical state of the lesser Eurozone economies is finally starting to settle in with the investors. At this point the whole concept of the Euro is looking more and more like a bad idea. It limits slower economies fall back of last resort, money printing and inflation to stop an economy from tanking completely. Now the only thing left is for the stronger economies to bail out the weaker ones, and that fact is not making investors and producers in the stronger economies very happy.

In the US I have noticed that the main effect of the debt limit debate is that people are really now starting to notice both the yearly deficit and the overall debt, along with how much money we spend every year on debt service. What investors are starting to see is that the US government is basically in a form of the same leverage crisis that torpedoed the investment banks. 

As for Asia I havent looked at that yet, but Asia could be a combination of China's economy starting to show the negative signs of its rapid and in some ways false expansion, as well as carry over from US and European markets.


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## Ravi

IMO, the looming government spending cuts are contributing to world wide panic.


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## JWBooth

When I first started watching this morning gold was up 7, then an hour ago it was u.p 5, now its up .8

Oil down 1


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## JWBooth

Dow futures jumping on 9.1 unemployment rate.


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## KissMy

July Jobs Numbers up 117K

Revised up previously announced May & June headline numbers.

Markets turn up.


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## Toro

KissMy said:


> July Jobs Numbers up 117K
> 
> Revised up previously announced May & June headline numbers.
> 
> Markets turn up.



Is this a reason to bounce or will investors sell?  Don't know many who want to be long over the weekend but the oversold readings are off the charts.


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## Toro

Europe is now in the green.


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## KissMy

Toro said:


> Europe is now in the green.



US Markets opened up green across the board. We are due for for a bounce from the oversold. Most will sell the bounce.


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## Toro

Up down up down up down. Volatility is high!  Typical of highly emotional markets.


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## KissMy

Toro said:


> Up down up down up down. Volatility is high!  Typical of highly emotional markets.



Must have a high volume wash-out turn before it is safe to re-enter market.


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## Trajan

Toro said:


> The other thread has turned into the usual mindless political hack garbage. This thread is to discuss the stock market crash without blaming everything on Republicans or Democrats by people who barely know the difference between a stock and livestock.
> 
> The UK has fallen 12% in 5 days. Switzerland has fallen 17% in 2 weeks.



the swiss franc has become overvalued for their own good and they have started the printing presses. they have that latitude, why? 

Italy is trying to be to cute by half, their bonds are unrealized junk, but they have to sell them to make that a reality and they won't.....whatever....I don't know what they think will change between now and November.


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## william the wie

The only serious question is how quickly the market is going to collapse? That will be when the OMG moment hits in regards to Europe or the Far East. When Obama tries another foreign bailout (he has already committed on that) I suspect that the house will impeach for high treason. He won't be convicted in the Senate but it will just about destroy the Democratic party in three-quarters of the states. Since the GOP is not ready for prime time that will be a major mess. That will really tank the stock market. Imagine Rand Paul vs. Michelle Bach as the two front runners for the 2016 presidential election. Think what that will do for your portfolio.


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## Ravi

william the wie said:


> The only serious question is how quickly the market is going to collapse? That will be when the OMG moment hits in regards to Europe or the Far East. When Obama tries another foreign bailout (he has already committed on that) I suspect that the house will impeach for high treason. He won't be convicted in the Senate but it will just about destroy the Democratic party in three-quarters of the states. Since the GOP is not ready for prime time that will be a major mess. That will really tank the stock market. Imagine Rand Paul vs. Michelle Bach as the two front runners for the 2016 presidential election. Think what that will do for your portfolio.


I think you've gotten a little too panicked and lost some of your marbles.


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## editec

Uncertainty breeds volitility.

We are, I think, in a long trend migrating from a world economy based on nationalism to a world economy based on weak states and stronger international corporations.

These are uncharted waters for mankind, folks.


When the passing of a law or trade agreement can completely change the dynamic of the market then knowing how high to jump or where to jump is pretty much not possible.

So many market prices have less to do with market forces than chaotic geopolitics.

The price of oil, for example, is more dependent on war and peace, than it is supply and demand.

In such circumstances, it is the INSIDERS who are the only people in a position to know where a market _might be_ going, and even they can be surprised by how forces outside their range of manipulation can blow up in their faces.


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## Quantum Windbag

Toro said:


> The other thread has turned into the usual mindless political hack garbage. This thread is to discuss the stock market crash without blaming everything on Republicans or Democrats by people who barely know the difference between a stock and livestock.
> 
> The UK has fallen 12% in 5 days. Switzerland has fallen 17% in 2 weeks.



Long term treasuries are up. It looks to me that, despite the stock market predicting a near term recession, investors still think the economy will be strong in the long term, and they actually think the US will still come out on top.


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## Quantum Windbag

Ravi said:


> IMO, the looming government spending cuts are contributing to world wide panic.



You don't think the bad economic news from Spain and the potential for another large scale bailout of a European country has anything to do with it?


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## Toro

Quantum Windbag said:


> Toro said:
> 
> 
> 
> The other thread has turned into the usual mindless political hack garbage. This thread is to discuss the stock market crash without blaming everything on Republicans or Democrats by people who barely know the difference between a stock and livestock.
> 
> The UK has fallen 12% in 5 days. Switzerland has fallen 17% in 2 weeks.
> 
> 
> 
> 
> Long term treasuries are up. It looks to me that, despite the stock market predicting a near term recession, investors still think the economy will be strong in the long term, and they actually think the US will still come out on top.
Click to expand...


You may be right but investors buy Treasuries in a Pavlovian manner when they think the economy is slowing or there is financial stress.


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## Toro

The Saudi Arabian stock market was open today and was down more than 5%.


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## william the wie

Toro said:


> The Saudi Arabian stock market was open today and was down more than 5%.


That is to be expected.


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## Quantum Windbag

Toro said:


> Quantum Windbag said:
> 
> 
> 
> 
> 
> Toro said:
> 
> 
> 
> The other thread has turned into the usual mindless political hack garbage. This thread is to discuss the stock market crash without blaming everything on Republicans or Democrats by people who barely know the difference between a stock and livestock.
> 
> The UK has fallen 12% in 5 days. Switzerland has fallen 17% in 2 weeks.
> 
> 
> 
> 
> Long term treasuries are up. It looks to me that, despite the stock market predicting a near term recession, investors still think the economy will be strong in the long term, and they actually think the US will still come out on top.
> 
> Click to expand...
> 
> 
> You may be right but investors buy Treasuries in a Pavlovian manner when they think the economy is slowing or there is financial stress.
Click to expand...


People that make their living off of investing act like trained dogs?

They are not buying short term bonds, which is why I think they are betting long term.


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## strollingbones

i got my statement today....no worries.....till i noted the close out date....7/31.....back to worries....i really try to ignore all this....just makes me nervous....i keep thinking of the movie....'splendor in the grass' where dee's father sell off his stocks to pay for her medical care and bud's father hold and goes broke when the market crashes...but then i remind myself that i pay someone to do this and they understand all this crap....i hope


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## strollingbones

do yall manage your own stocks?


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## william the wie

strollingbones said:


> do yall manage your own stocks?


I manage my own accounts but other than gold mines I avoid stocks and instead spend my money waiting for the next crash or bubble in the indices.


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## Toro

strollingbones said:


> do yall manage your own stocks?



Yes.


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## Toro

Quantum Windbag said:


> People that make their living off of investing act like trained dogs?



Yes.



Quantum Windbag said:


> They are not buying short term bonds, which is why I think they are betting long term.



They are buying short term government bonds.  They are also buying long term government bonds.  Maybe they won't soon, I don't know.


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## william the wie

Toro said:


> Quantum Windbag said:
> 
> 
> 
> People that make their living off of investing act like trained dogs?
> 
> 
> 
> 
> Yes.
> 
> *Even Graham emphasized the importance of doing everything systematically if for no other reason than to your identify errors. It is extremely dangerous not to invest like a trained dog because your emotional responses will betray you. *
> 
> 
> 
> Quantum Windbag said:
> 
> 
> 
> They are not buying short term bonds, which is why I think they are betting long term.
> 
> Click to expand...
> 
> 
> They are buying short term government bonds.  They are also buying long term government bonds.  Maybe they won't soon, I don't know.
Click to expand...


Panic buying of gold and gold mining stocks are starting to be seen and a return to specie in some countries is a wild card that cannot be quantified but that is being dismissed without sufficient cause.


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## Wiseacre

Thought I heard today that many people are buying 10 yr US bonds.   The rates are not good, but it's all about capital preservation.   Weird, people are even scared of gold a little bit, usually a safe haven when the crap hits the fan.


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## KissMy

william the wie said:


> Panic buying of gold and gold mining stocks are starting to be seen and a return to specie in some countries is a wild card that cannot be quantified but that is being dismissed without sufficient cause.



Gold is not panic driven. It is driven by fundamentals. $115 Trillion in US unfunded liabilities is assurance that the US Dollar & Bonds will continue to decline in value. People who know the facts or do the math do not dismiss Gold without sufficient cause.


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## william the wie

KissMy said:


> william the wie said:
> 
> 
> 
> Panic buying of gold and gold mining stocks are starting to be seen and a return to specie in some countries is a wild card that cannot be quantified but that is being dismissed without sufficient cause.
> 
> 
> 
> 
> Gold is not panic driven. It is driven by fundamentals. $115 Trillion in US unfunded liabilities is assurance that the US Dollar & Bonds will continue to decline in value. People who know* the facts or do the math* do not dismiss Gold without sufficient cause.
Click to expand...

I bolded your fallacy. You don't think there are enough people who can't do their own research or math that you can ignore their effects do you? Ignorance and innumeracy is surprisingly widespread and among those who are neither you have to subtract out the easily swayed.


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## Toro

KissMy said:


> william the wie said:
> 
> 
> 
> Panic buying of gold and gold mining stocks are starting to be seen and a return to specie in some countries is a wild card that cannot be quantified but that is being dismissed without sufficient cause.
> 
> 
> 
> 
> Gold is not panic driven. It is driven by fundamentals. $115 Trillion in US unfunded liabilities is assurance that the US Dollar & Bonds will continue to decline in value. People who know the facts or do the math do not dismiss Gold without sufficient cause.
Click to expand...


There is some panic buying of gold.  I don't like being exposed when there is panic buying because fear can turn on a dime, and thus so can gold prices. I like it when gold is going up because fiat currencies are being debased.  That is a long-term trend that is easier to navigate.  Fear is a short-term trend that is difficult to navigate.  I am expecting a break in gold some time over the next few weeks as the panic subsides.


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## uscitizen

I think this is just a panic adjustment based on the realization that this functional if not technical recession will be around for a while.

The market is functioning as it should.


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## DavidS

Anyone have any bets for monday? 500 points seems like a given at this point.


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## KissMy

Toro said:


> KissMy said:
> 
> 
> 
> 
> 
> william the wie said:
> 
> 
> 
> Panic buying of gold and gold mining stocks are starting to be seen and a return to specie in some countries is a wild card that cannot be quantified but that is being dismissed without sufficient cause.
> 
> 
> 
> 
> Gold is not panic driven. It is driven by fundamentals. $115 Trillion in US unfunded liabilities is assurance that the US Dollar & Bonds will continue to decline in value. People who know the facts or do the math do not dismiss Gold without sufficient cause.
> 
> Click to expand...
> 
> 
> There is some panic buying of gold.  I don't like being exposed when there is panic buying because fear can turn on a dime, and thus so can gold prices. I like it when gold is going up because fiat currencies are being debased.  That is a long-term trend that is easier to navigate.  Fear is a short-term trend that is difficult to navigate.  I am expecting a break in gold some time over the next few weeks as the panic subsides.
Click to expand...


Where will the funding for the $115 Trillion in US unfunded liabilities come from? See: US Debt Clock

I assume there will be a compromise. 1/3 in cuts, 1/3 in higher tax revenues & 1/3 from currency debasement. So 1/3 of the $115 Trillion unfunded liabilities = $38.33 Trillion in currency debasement over the next 10 years.

NPR says US unfunded liabilities come to $211 Trillion. Clearly this puts way further up shit creek without a paddle.

NPR: A National Debt Of $14 Trillion? Try $211 Trillion


> "If you add up all the promises that have been made for spending obligations, including defense expenditures, and you subtract all the taxes that we expect to collect, the difference is $211 trillion. That's the fiscal gap," he says. "That's our true indebtedness."


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## Toro

At 6:30pm on Sunday, Dow futures are down 300.


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## william the wie

Toro said:


> At 6:30pm on Sunday, Dow futures are down 300.


I feel like an idiot. If I had instituted my new strategy 6 months back I would be positioned perfectly.


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## dilloduck

william the wie said:


> Toro said:
> 
> 
> 
> At 6:30pm on Sunday, Dow futures are down 300.
> 
> 
> 
> I feel like an idiot. If I had instituted my new strategy 6 months back I would be positioned perfectly.
Click to expand...


That's why they call it gambling.


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## Immanuel

My thoughts are that only an idiot panic sells.  If you call your broker first thing in the morning and tell him to start selling, it is already too late.

I think people should be looking for some good buys tomorrow and no, I don't have any recommendations.

The question people should be asking is not "how far will it fall?", but rather "how long will it take to recover?"

Immie


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## Flopper

uscitizen said:


> I think this is just a panic adjustment based on the realization that this functional if not technical recession will be around for a while.
> 
> The market is functioning as it should.


If I were speculating which I don't, I would be buying well diversified US stocks on any weakness.  I'm 10% in gold and will hold that position but I certainly will not buy more.  When the economy starts moving, which it will eventually, gold will fall like a rock.


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## Flopper

Immanuel said:


> My thoughts are that only an idiot panic sells.  If you call your broker first thing in the morning and tell him to start selling, it is already too late.
> 
> I think people should be looking for some good buys tomorrow and no, I don't have any recommendations.
> 
> The question people should be asking is not "how far will it fall?", but rather "how long will it take to recover?"
> 
> Immie


True.  The market has already discounted the credit downgrade and is looking ahead.  If your speculating, looking at old news is a sure way to lose your shirt.


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## Ernie S.

Gold is $1,700.20/oz  Up 36 bucks since the far East opened.
Not going to be a good day on Wall Street.


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## Toro

We could crash again today.

Or ...

We could be setting up for a bottom.  

Bottoms occur at the height of fear and panic.  It often manifests in the futures market before the open, when the market is down 200-300 points off something like the downgrade.  Watch what happens to the market during the day.  If it is a bottom, it will often occur in the first hour.  The rest of the day will likely see buying into the close, with the market closing on the highs of the day.  Then, on Tuesday or Wednesday, we should see some follow through on the upside.  

Or, we could just be crashing again.


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## editec

Toro said:


> We could crash again today.
> 
> Or ...
> 
> We could be setting up for a bottom.
> 
> Bottoms occur at the height of fear and panic. It often manifests in the futures market before the open, when the market is down 200-300 points off something like the downgrade. Watch what happens to the market during the day. If it is a bottom, it will often occur in the first hour. The rest of the day will likely see buying into the close, with the market closing on the highs of the day. Then, on Tuesday or Wednesday, we should see some follow through on the upside.
> 
> Or, we could just be crashing again.


 
We're either crashing or we're crashed?

That's a safe bet, I guess.

Now how does one capitalize on_ that_ news?


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## bitterlyclingin

"stocks go up and stocks go down" JP Morgan,
 "If you can keep your head about you when all others are losing theirs..." Rudyard Kipling
Its only when you have a Socialist, or would be Socialist, whose very members of his own "Brain Trust" advisors made personal pilgrimages to the Soviet Union two years before the Great depression made its presence felt on these shores who also had a personal tete a' tete with none other than Joseph Stalin during that visit, and then were put into positions of power here where they could implement some or all of those Socialist ideas gleaned from their visit to the USSR, that ordinary two year economic downturns turn into twelve year Great Depressions. Communes in Arizona and bringing to trial the Shechter Brothers, immigrant Kosher butchers from Brooklyn, for violating New Deal regulations by criminally letting their customers select which chickens they wanted slaughtered, indeed.


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## Truthmatters

I guess you will all move to the latin markets now huh?


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## Truthmatters

Its open, lets see how the predictions hold up


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## KissMy

You don't need to buy gold today on a high but anyone who does not have gold as a part of their portfolio is a complete fool.


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## Truthmatters

Its pretty late to get into gold.


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## Flopper

editec said:


> Toro said:
> 
> 
> 
> We could crash again today.
> 
> Or ...
> 
> We could be setting up for a bottom.
> 
> Bottoms occur at the height of fear and panic. It often manifests in the futures market before the open, when the market is down 200-300 points off something like the downgrade. Watch what happens to the market during the day. If it is a bottom, it will often occur in the first hour. The rest of the day will likely see buying into the close, with the market closing on the highs of the day. Then, on Tuesday or Wednesday, we should see some follow through on the upside.
> 
> Or, we could just be crashing again.
> 
> 
> 
> 
> We're either crashing or we're crashed?
> 
> That's a safe bet, I guess.
> 
> Now how does one capitalize on_ that_ news?
Click to expand...

*Don't gamble; take all your savings and buy some good stock and hold it till it goes up, then sell it. If it don't go up, don't buy it.
Will Rogers*


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## Toro

Woowee!  Now that's a beatdown!  Dow down 635. S&P down 80. Russell 2000 down 64. Small cap stocks fell 7% today. Large caps were down 6.7%. The S&P is down 13.4% in August, the worst start to August ever.


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## CrusaderFrank

Toro said:


> Woowee!  Now that's a beatdown!  Dow down 635. S&P down 80. Russell 2000 down 64. Small cap stocks fell 7% today. Large caps were down 6.7%. The S&P is down 13.4% in August, the worst start to August ever.



Well what did you expect when we have a POTUS who makes Alger Hiss look like an American Founding Father?


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## cloudy

Toro said:


> The other thread has turned into the usual mindless political hack garbage. This thread is to discuss the stock market crash without blaming everything on Republicans or Democrats by people who barely know the difference between a stock and livestock.
> 
> The UK has fallen 12% in 5 days. Switzerland has fallen 17% in 2 weeks.



Crash and burn baby burn! I hope they go belly up, without getting any government help this time, NO BAILOUTS!


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## Toro

CrusaderFrank said:


> Toro said:
> 
> 
> 
> Woowee!  Now that's a beatdown!  Dow down 635. S&P down 80. Russell 2000 down 64. Small cap stocks fell 7% today. Large caps were down 6.7%. The S&P is down 13.4% in August, the worst start to August ever.
> 
> 
> 
> 
> Well what did you expect when we have a POTUS who makes Alger Hiss look like an American Founding Father?
Click to expand...


This is the Serious Stock Market Crash Thread. Please post all political slandering in the other thread. Thanks.


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## Baruch Menachem

It is worth noting that not just the US Markets tanked today.   They all did.

And that it isn't just about Obama.   As much as that would bother him.    It is also about Spain and Italy beging given handouts to do more of the same as well.    The Eruo bank bailed out the Italians and Spaniards, who will not do reform, but seem determined to take the rest of europe with them.


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## DavidS

A friend of mine got out when Boehner walked away from Obama for "moving the goal posts." 

We were above 12,000 then.

I'm not sure we're going to end the week above 10,000.


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## Flopper

Toro said:


> Woowee!  Now that's a beatdown!  Dow down 635. S&P down 80. Russell 2000 down 64. Small cap stocks fell 7% today. Large caps were down 6.7%. The S&P is down 13.4% in August, the worst start to August ever.


No summer rally this year.  Europe is looking a lot worse than the US.  We just need to have politicians start drawing some red lines in the budget or raise some taxes.  In contrast to the United States, the European Union has a constitutional problem: Serious sanctions against members who go into deep debt are nowhere to be seen on the horizon as of yet. As long as Europe&#8217;s politicians fail to solve that problem, the euro will lurch from one crisis to the next. America&#8217;s problems seem almost trivial in comparison.

Watching America   :   » America Is in Better Shape Than Europe


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## bill5

Toro said:


> The other thread has turned into the usual mindless political hack garbage.


Shocking isn't it  



> This thread is to discuss the stock market crash without blaming everything on Republicans or Democrats by people who barely know the difference between a stock and livestock.


Refreshing approach and thanks for that.  



My pathetic money market isn't ideal but not lookin so bad now.    I want to move it but not many option right now IMO.  Might spread into a few CDs, but they aren't much better right now.


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## Trajan

every blue chip I track was down at least 2.5%, bank of America down almost *20*% to 6.51. wow....


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## Modbert

Every market is down today.



Trajan said:


> every blue chip I track was down at least 2.5%, bank of America down almost *20*% to 6.51. wow....



That's because AIG hit them with a $10 billion lawsuit.

http://online.wsj.com/article/BT-CO-20110808-714292.html



> NEW YORK (Dow Jones)--Bank of America (BAC) shares fell more than 17% as of midday Monday, leading financial stocks down in a broader market sell-off.
> 
> Earlier Monday, American International Group Inc. (AIG) sued the Charlotte-based bank, the largest U.S. bank by assets, seeking to recover the $10 billion it lost on mortgage investments. AIG also intends to object to Bank of America's $8.5 billion settlement with other bond investors.


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## Toro

Baruch Menachem said:


> It is worth noting that not just the US Markets tanked today.   They all did.
> 
> And that it isn't just about Obama.   As much as that would bother him.    It is also about Spain and Italy beging given handouts to do more of the same as well.    The Eruo bank bailed out the Italians and Spaniards, who will not do reform, but seem determined to take the rest of europe with them.



Today was about the downgrade.  Last week was about the European banking system.  Last week, most European stock markers fell further than the US.


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## Toro

Modbert said:


> Every market is down today.
> 
> 
> 
> Trajan said:
> 
> 
> 
> every blue chip I track was down at least 2.5%, bank of America down almost *20*% to 6.51. wow....
> 
> 
> 
> 
> That's because AIG hit them with a $10 billion lawsuit.
> 
> Bank of America Shares Plummet Monday After Lawsuit, US Debt Downgrade - WSJ.com
> 
> 
> 
> 
> NEW YORK (Dow Jones)--Bank of America (BAC) shares fell more than 17% as of midday Monday, leading financial stocks down in a broader market sell-off.
> 
> Earlier Monday, American International Group Inc. (AIG) sued the Charlotte-based bank, the largest U.S. bank by assets, seeking to recover the $10 billion it lost on mortgage investments. AIG also intends to object to Bank of America's $8.5 billion settlement with other bond investors.
> 
> Click to expand...
Click to expand...


That's part of it, but not entirely.  If I recall correctly, tangible book value for BofA is about $50 billion.  Since AIG won't recover all $10 billion, even after the lawsuits, BofA will still be well capitalized, at least after the lawsuits.  The worry, in part, is that as the most exposed domestically of the biggest banks, BofA still has a lot of garbage from their purchase of Countrywide that will roll over if we go into recession.  Also, BofA is owned by some large hedge funds that have had bad performance over the past few months.  Other hedge funds are shooting against those funds, trying to break the poor performing hedge funds by banging down their holdings such as BofA.


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## Modbert

Toro said:


> That's part of it, but not entirely.  If I recall correctly, tangible book value for BofA is about $50 billion.  Since AIG won't recover all $10 billion, even after the lawsuits, BofA will still be well capitalized, at least after the lawsuits.  The worry, in part, is that as the most exposed domestically of the biggest banks, BofA still has a lot of garbage from their purchase of Countrywide that will roll over if we go into recession.  Also, BofA is owned by some large hedge funds that have had bad performance over the past few months.  Other hedge funds are shooting against those funds, trying to break the poor performing hedge funds by banging down their holdings such as BofA.



True, it's not the entire reason but it does certainly contribute to their troubles. Where do you see Bank of America a year from now?


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## Trajan

Modbert said:


> Toro said:
> 
> 
> 
> That's part of it, but not entirely.  If I recall correctly, tangible book value for BofA is about $50 billion.  Since AIG won't recover all $10 billion, even after the lawsuits, BofA will still be well capitalized, at least after the lawsuits.  The worry, in part, is that as the most exposed domestically of the biggest banks, BofA still has a lot of garbage from their purchase of Countrywide that will roll over if we go into recession.  Also, BofA is owned by some large hedge funds that have had bad performance over the past few months.  Other hedge funds are shooting against those funds, trying to break the poor performing hedge funds by banging down their holdings such as BofA.
> 
> 
> 
> 
> True, it's not the entire reason but it does certainly contribute to their troubles. Where do you see Bank of America a year from now?
Click to expand...


getting a bailout......

actually I am not kidding


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## Toro

Modbert said:


> Toro said:
> 
> 
> 
> That's part of it, but not entirely.  If I recall correctly, tangible book value for BofA is about $50 billion.  Since AIG won't recover all $10 billion, even after the lawsuits, BofA will still be well capitalized, at least after the lawsuits.  The worry, in part, is that as the most exposed domestically of the biggest banks, BofA still has a lot of garbage from their purchase of Countrywide that will roll over if we go into recession.  Also, BofA is owned by some large hedge funds that have had bad performance over the past few months.  Other hedge funds are shooting against those funds, trying to break the poor performing hedge funds by banging down their holdings such as BofA.
> 
> 
> 
> 
> True, it's not the entire reason but it does certainly contribute to their troubles. Where do you see Bank of America a year from now?
Click to expand...


I have no idea.  Either a zero or much higher from here.


----------



## Toro

> The NYSE only had 50 stocks in positive territory at the end of the day, while there were 3,111 in the red. The last time breadth was this bad was over 70 years ago in 1940 when Germany invaded France.



http://www.thestreet.com/p/_revblog/rmoney/revsharkblog/11214181.html


----------



## Trajan

Toro said:


> The NYSE only had 50 stocks in positive territory at the end of the day, while there were 3,111 in the red. The last time breadth was this bad was over 70 years ago in 1940 when Germany invaded France.
> 
> 
> 
> 
> http://www.thestreet.com/p/_revblog/rmoney/revsharkblog/11214181.html
Click to expand...



from the link..


> you have to wonder if the market is close to some sort of massive snap-back rally....




I won't bet on I, BUT I am ready to add some choice stocks to my portfolio and am prepared to hold, tomorrows Volume will tell us a lot more.


----------



## Flopper

Trajan said:


> every blue chip I track was down at least 2.5%, bank of America down almost *20*% to 6.51. wow....


AIG is suing them for 10 billion.


----------



## Trajan

Flopper said:


> Trajan said:
> 
> 
> 
> every blue chip I track was down at least 2.5%, bank of America down almost *20*% to 6.51. wow....
> 
> 
> 
> AIG is suing them for 10 billion.
Click to expand...


no problem,  they can write them a check from uncle sams kick...

and is that after or before the robosigning thing whacks them too? its a mess.


----------



## Quantum Windbag

Toro said:


> Baruch Menachem said:
> 
> 
> 
> It is worth noting that not just the US Markets tanked today.   They all did.
> 
> And that it isn't just about Obama.   As much as that would bother him.    It is also about Spain and Italy beging given handouts to do more of the same as well.    The Eruo bank bailed out the Italians and Spaniards, who will not do reform, but seem determined to take the rest of europe with them.
> 
> 
> 
> 
> Today was about the downgrade.  Last week was about the European banking system.  Last week, most European stock markers fell further than the US.
Click to expand...


Here is what I do not get, and apparently I am not the only one that is completely confused by this. If this is about the downgrade why are so many people buying treasuries? 

Paul Krugman.

Aaauuuggghhh! Market Commentary Edition - NYTimes.com

Arnold Kling.

Market plunge: Don&#39;t blame the Standard & Poor&#39;s downgrade

The Downgrade might be a factor, but it is certainly not the driving force behind what is happening. If it was people would also be avoiding the one thing that is directly related to the downgrade, and they are not doing that.


----------



## Ravi

Quantum Windbag said:


> Toro said:
> 
> 
> 
> 
> 
> Baruch Menachem said:
> 
> 
> 
> It is worth noting that not just the US Markets tanked today.   They all did.
> 
> And that it isn't just about Obama.   As much as that would bother him.    It is also about Spain and Italy beging given handouts to do more of the same as well.    The Eruo bank bailed out the Italians and Spaniards, who will not do reform, but seem determined to take the rest of europe with them.
> 
> 
> 
> 
> Today was about the downgrade.  Last week was about the European banking system.  Last week, most European stock markers fell further than the US.
> 
> Click to expand...
> 
> 
> Here is what I do not get, and apparently I am not the only one that is completely confused by this. If this is about the downgrade why are so many people buying treasuries?
> 
> Paul Krugman.
> 
> Aaauuuggghhh! Market Commentary Edition - NYTimes.com
> 
> Arnold Kling.
> 
> Market plunge: Don't blame the Standard & Poor's downgrade
> 
> The Downgrade might be a factor, but it is certainly not the driving force behind what is happening. If it was people would also be avoiding the one thing that is directly related to the downgrade, and they are not doing that.
Click to expand...


Good question and one I've asked a few times with no serious answer.


----------



## Toro

Quantum Windbag said:


> Toro said:
> 
> 
> 
> 
> 
> Baruch Menachem said:
> 
> 
> 
> It is worth noting that not just the US Markets tanked today.   They all did.
> 
> And that it isn't just about Obama.   As much as that would bother him.    It is also about Spain and Italy beging given handouts to do more of the same as well.    The Eruo bank bailed out the Italians and Spaniards, who will not do reform, but seem determined to take the rest of europe with them.
> 
> 
> 
> 
> Today was about the downgrade.  Last week was about the European banking system.  Last week, most European stock markers fell further than the US.
> 
> Click to expand...
> 
> 
> Here is what I do not get, and apparently I am not the only one that is completely confused by this. If this is about the downgrade why are so many people buying treasuries?
> 
> Paul Krugman.
> 
> Aaauuuggghhh! Market Commentary Edition - NYTimes.com
> 
> Arnold Kling.
> 
> Market plunge: Don't blame the Standard & Poor's downgrade
> 
> The Downgrade might be a factor, but it is certainly not the driving force behind what is happening. If it was people would also be avoiding the one thing that is directly related to the downgrade, and they are not doing that.
Click to expand...


I disagree with Krugman.  There is a weird dynamic in the market right now.  Treasuries are the default instrument for those seeking safety.  So a downgrade increases fear in the market, which causes buying of the "safest" investment, which are Treasuries.  It's circular, I know, but don't the market is weird sometimes.  Note that Japan was downgraded many years ago to AA+ and yields on JGBs are far lower now than when they were when they were downgraded.  The market is selling off in part because of the economic slowdown, but that wasn't why we were down so heavily today.  

At 8pm, Dow futures were down another 75 points.


----------



## Ravi

Toro said:


> Quantum Windbag said:
> 
> 
> 
> 
> 
> Toro said:
> 
> 
> 
> Today was about the downgrade.  Last week was about the European banking system.  Last week, most European stock markers fell further than the US.
> 
> 
> 
> 
> Here is what I do not get, and apparently I am not the only one that is completely confused by this. If this is about the downgrade why are so many people buying treasuries?
> 
> Paul Krugman.
> 
> Aaauuuggghhh! Market Commentary Edition - NYTimes.com
> 
> Arnold Kling.
> 
> Market plunge: Don't blame the Standard & Poor's downgrade
> 
> The Downgrade might be a factor, but it is certainly not the driving force behind what is happening. If it was people would also be avoiding the one thing that is directly related to the downgrade, and they are not doing that.
> 
> Click to expand...
> 
> 
> I disagree with Krugman.  There is a weird dynamic in the market right now.  Treasuries are the default instrument for those seeking safety.  So a downgrade increases fear in the market, which causes buying of the "safest" investment, which are Treasuries.  It's circular, I know, but don't the market is weird sometimes.  Note that Japan was downgraded many years ago to AA+ and yields on JGBs are far lower now than when they were when they were downgraded.  The market is selling off in part because of the economic slowdown, but that wasn't why we were down so heavily today.
> 
> At 8pm, Dow futures were down another 75 points.
Click to expand...


Is it possible that the markets have more trust in the ability of the US to pay than they do in the ability of corporations to pay in this economy? Even with the downgrade, no one thinks the US will suddenly stop paying its debts. No so much with corporations.


----------



## Flopper

Quantum Windbag said:


> Toro said:
> 
> 
> 
> 
> 
> Baruch Menachem said:
> 
> 
> 
> It is worth noting that not just the US Markets tanked today.   They all did.
> 
> And that it isn't just about Obama.   As much as that would bother him.    It is also about Spain and Italy beging given handouts to do more of the same as well.    The Eruo bank bailed out the Italians and Spaniards, who will not do reform, but seem determined to take the rest of europe with them.
> 
> 
> 
> 
> Today was about the downgrade.  Last week was about the European banking system.  Last week, most European stock markers fell further than the US.
> 
> Click to expand...
> 
> 
> Here is what I do not get, and apparently I am not the only one that is completely confused by this. If this is about the downgrade why are so many people buying treasuries?
> 
> Paul Krugman.
> 
> Aaauuuggghhh! Market Commentary Edition - NYTimes.com
> 
> Arnold Kling.
> 
> Market plunge: Don&#39;t blame the Standard & Poor&#39;s downgrade
> 
> The Downgrade might be a factor, but it is certainly not the driving force behind what is happening. If it was people would also be avoiding the one thing that is directly related to the downgrade, and they are not doing that.
Click to expand...

They are buying treasuries because the US is always looked on as a safe have in times of crisis. While stock markets were selling off around the world bonds rallied. The 30-year bond price gained more than a point in price as investors sent their own clear message that in times of turmoil, Treasurys were still the safest house on the block.  News Headlines

Keep in mind that the two other major bond rating services, Moody's and Fitch have not change their AAA rating.  In fact Moody's reaffirmed that rating twice this week.

I find it interesting that S&P, whose failure to rate bonds properly were a major cause of the 2008 debacle in the bond market is now setting off a major stock market crash in 2011.


----------



## Toro

Trajan said:


> Toro said:
> 
> 
> 
> 
> 
> 
> The NYSE only had 50 stocks in positive territory at the end of the day, while there were 3,111 in the red. The last time breadth was this bad was over 70 years ago in 1940 when Germany invaded France.
> 
> 
> 
> 
> http://www.thestreet.com/p/_revblog/rmoney/revsharkblog/11214181.html
> 
> Click to expand...
> 
> 
> 
> from the link..
> 
> 
> 
> you have to wonder if the market is close to some sort of massive snap-back rally....
> 
> Click to expand...
> 
> 
> 
> I won't bet on I, BUT I am ready to add some choice stocks to my portfolio and am prepared to hold, tomorrows Volume will tell us a lot more.
Click to expand...


When the market snaps back, it will most likely be massive.  The question will be whether or not it will hold.

Ideally, you don't want the market to rally right back.  You want the market to hit a low, stabilize, retest the low and hold.  The more times it does that, the more confident you can be that a bottom is in because it will signal an exhaustion in selling.  What is most likely to happen is a bounce after a consolidation, then a retest that either holds or breaks down.  If we retest and hold, I will get very aggressive on the upside.

But right now, the market is very dangerous and I am just sitting in cash and waiting.


----------



## Toro

Ravi said:


> Toro said:
> 
> 
> 
> 
> 
> Quantum Windbag said:
> 
> 
> 
> Here is what I do not get, and apparently I am not the only one that is completely confused by this. If this is about the downgrade why are so many people buying treasuries?
> 
> Paul Krugman.
> 
> Aaauuuggghhh! Market Commentary Edition - NYTimes.com
> 
> Arnold Kling.
> 
> Market plunge: Don't blame the Standard & Poor's downgrade
> 
> The Downgrade might be a factor, but it is certainly not the driving force behind what is happening. If it was people would also be avoiding the one thing that is directly related to the downgrade, and they are not doing that.
> 
> 
> 
> 
> I disagree with Krugman.  There is a weird dynamic in the market right now.  Treasuries are the default instrument for those seeking safety.  So a downgrade increases fear in the market, which causes buying of the "safest" investment, which are Treasuries.  It's circular, I know, but don't the market is weird sometimes.  Note that Japan was downgraded many years ago to AA+ and yields on JGBs are far lower now than when they were when they were downgraded.  The market is selling off in part because of the economic slowdown, but that wasn't why we were down so heavily today.
> 
> At 8pm, Dow futures were down another 75 points.
> 
> Click to expand...
> 
> 
> Is it possible that the markets have more trust in the ability of the US to pay than they do in the ability of corporations to pay in this economy? Even with the downgrade, no one thinks the US will suddenly stop paying its debts. No so much with corporations.
Click to expand...


Most likely. 

Remember, a downgrade doesn't mean that the US will default.  It means that the probability of a default has risen.  And a decline from AAA to AA+ is a fairly minor increase in the perceived probability of a default.  That isn't a minimization of the downgrade, just a recognition of what a downgrade means.

Dow futures down 90 at 8:20.


----------



## Quantum Windbag

Toro said:


> Quantum Windbag said:
> 
> 
> 
> 
> 
> Toro said:
> 
> 
> 
> Today was about the downgrade.  Last week was about the European banking system.  Last week, most European stock markers fell further than the US.
> 
> 
> 
> 
> Here is what I do not get, and apparently I am not the only one that is completely confused by this. If this is about the downgrade why are so many people buying treasuries?
> 
> Paul Krugman.
> 
> Aaauuuggghhh! Market Commentary Edition - NYTimes.com
> 
> Arnold Kling.
> 
> Market plunge: Don't blame the Standard & Poor's downgrade
> 
> The Downgrade might be a factor, but it is certainly not the driving force behind what is happening. If it was people would also be avoiding the one thing that is directly related to the downgrade, and they are not doing that.
> 
> Click to expand...
> 
> 
> I disagree with Krugman.  There is a weird dynamic in the market right now.  Treasuries are the default instrument for those seeking safety.  So a downgrade increases fear in the market, which causes buying of the "safest" investment, which are Treasuries.  It's circular, I know, but don't the market is weird sometimes.  Note that Japan was downgraded many years ago to AA+ and yields on JGBs are far lower now than when they were when they were downgraded.  The market is selling off in part because of the economic slowdown, but that wasn't why we were down so heavily today.
> 
> At 8pm, Dow futures were down another 75 points.
Click to expand...


It is not just Krugman though, most of the economists are pointing out the discrepancy. You want to dismiss it as people going for what is safe, but if this is actual fear of the downgrade then treasuries would not be the refuge of choice, and people would be demanding higher interest rates to compensate for the added risk.

That is not happening.


----------



## Quantum Windbag

Flopper said:


> Quantum Windbag said:
> 
> 
> 
> 
> 
> Toro said:
> 
> 
> 
> Today was about the downgrade.  Last week was about the European banking system.  Last week, most European stock markers fell further than the US.
> 
> 
> 
> 
> Here is what I do not get, and apparently I am not the only one that is completely confused by this. If this is about the downgrade why are so many people buying treasuries?
> 
> Paul Krugman.
> 
> Aaauuuggghhh! Market Commentary Edition - NYTimes.com
> 
> Arnold Kling.
> 
> Market plunge: Don't blame the Standard & Poor's downgrade
> 
> The Downgrade might be a factor, but it is certainly not the driving force behind what is happening. If it was people would also be avoiding the one thing that is directly related to the downgrade, and they are not doing that.
> 
> Click to expand...
> 
> They are buying treasuries because the US is always looked on as a safe have in times of crisis. While stock markets were selling off around the world bonds rallied. The 30-year bond price gained more than a point in price as investors sent their own clear message that in times of turmoil, Treasurys were still the safest house on the block.  News Headlines
> 
> Keep in mind that the two other major bond rating services, Moody's and Fitch have not change their AAA rating.  In fact Moody's reaffirmed that rating twice this week.
> 
> I find it interesting that S&P, whose failure to rate bonds properly were a major cause of the 2008 debacle in the bond market is now setting off a major stock market crash in 2011.
Click to expand...


S&P has been wrong pretty consistently recently. Maybe investors are betting on their track record.


----------



## Flopper

Toro said:


> Ravi said:
> 
> 
> 
> 
> 
> Toro said:
> 
> 
> 
> I disagree with Krugman.  There is a weird dynamic in the market right now.  Treasuries are the default instrument for those seeking safety.  So a downgrade increases fear in the market, which causes buying of the "safest" investment, which are Treasuries.  It's circular, I know, but don't the market is weird sometimes.  Note that Japan was downgraded many years ago to AA+ and yields on JGBs are far lower now than when they were when they were downgraded.  The market is selling off in part because of the economic slowdown, but that wasn't why we were down so heavily today.
> 
> At 8pm, Dow futures were down another 75 points.
> 
> 
> 
> 
> Is it possible that the markets have more trust in the ability of the US to pay than they do in the ability of corporations to pay in this economy? Even with the downgrade, no one thinks the US will suddenly stop paying its debts. No so much with corporations.
> 
> Click to expand...
> 
> 
> Most likely.
> 
> Remember, a downgrade doesn't mean that the US will default.  It means that the probability of a default has risen.  And a decline from AAA to AA+ is a fairly minor increase in the perceived probability of a default.  That isn't a minimization of the downgrade, just a recognition of what a downgrade means.
> 
> Dow futures down 90 at 8:20.
Click to expand...

Also keep in mind that Moody's, the largest bond rating service in world is not in agree with S&P, nor is Fitch.


----------



## Ravi

Flopper said:


> Toro said:
> 
> 
> 
> 
> 
> Ravi said:
> 
> 
> 
> Is it possible that the markets have more trust in the ability of the US to pay than they do in the ability of corporations to pay in this economy? Even with the downgrade, no one thinks the US will suddenly stop paying its debts. No so much with corporations.
> 
> 
> 
> 
> Most likely.
> 
> Remember, a downgrade doesn't mean that the US will default.  It means that the probability of a default has risen.  And a decline from AAA to AA+ is a fairly minor increase in the perceived probability of a default.  That isn't a minimization of the downgrade, just a recognition of what a downgrade means.
> 
> Dow futures down 90 at 8:20.
> 
> Click to expand...
> 
> Also keep in mind that Moody's, the largest bond rating service in world is not in agree with S&P, nor is Fitch.
Click to expand...


So why did S&P downgrade? They certainly do not have a good track record and have admitted to making that 2 trillion dollar mistake.

How is it possible that a rating company with a bad track record can cause a world wide panic?


----------



## Toro

Quantum Windbag said:


> Toro said:
> 
> 
> 
> 
> 
> Quantum Windbag said:
> 
> 
> 
> Here is what I do not get, and apparently I am not the only one that is completely confused by this. If this is about the downgrade why are so many people buying treasuries?
> 
> Paul Krugman.
> 
> Aaauuuggghhh! Market Commentary Edition - NYTimes.com
> 
> Arnold Kling.
> 
> Market plunge: Don't blame the Standard & Poor's downgrade
> 
> The Downgrade might be a factor, but it is certainly not the driving force behind what is happening. If it was people would also be avoiding the one thing that is directly related to the downgrade, and they are not doing that.
> 
> 
> 
> 
> I disagree with Krugman.  There is a weird dynamic in the market right now.  Treasuries are the default instrument for those seeking safety.  So a downgrade increases fear in the market, which causes buying of the "safest" investment, which are Treasuries.  It's circular, I know, but don't the market is weird sometimes.  Note that Japan was downgraded many years ago to AA+ and yields on JGBs are far lower now than when they were when they were downgraded.  The market is selling off in part because of the economic slowdown, but that wasn't why we were down so heavily today.
> 
> At 8pm, Dow futures were down another 75 points.
> 
> Click to expand...
> 
> 
> It is not just Krugman though, most of the economists are pointing out the discrepancy. You want to dismiss it as people going for what is safe, but if this is actual fear of the downgrade then treasuries would not be the refuge of choice, and people would be demanding higher interest rates to compensate for the added risk.
> 
> That is not happening.
Click to expand...


I long ago stopped listening to (almost all) economists describing what is going on in capital markets.  Most of them have little practical experience.  I heard investors talking about a bid in Treasuries if the US defaulted, which is even more severe than a downgrade, and an even greater contradiction.  Our bond desk was talking to the Street about the buying Treasuries during today's session.  Some of the weakness in the economy which weighed on markets last week bled into the markets today.  And there were other factors as well - if you think BofA might go belly up, would you rather own BofA bonds or Treasuries?  But everything I heard was about the downgrade.  The economists may eventually be right about this, but they are wrong today.


----------



## HenryBHough

By the end of the week, unless Obama resigns, what you saw today will be called "part of the runup to the crash."


----------



## Ravi

What if everyone wakes up tomorrow and realizes that since investors are flocking to US Treasuries, they are not a crap shoot? What happens to the panic then?


----------



## JWBooth

Australia             -199.40             -4.92%             3,857.30             8:59pm ET                                                                          





                           Japan             -369.17             -4.06%             8,728.39             8:59pm ET


----------



## JWBooth

More markets are open...and falling

Australia ASX All Ordinaries             Australia             -211.20             -5.21%             3,845.50             9:13pm ET
Hang Seng             Hong Kong             -1,280.87             -6.25%             19,209.70             9:23pm ET
Taiwan TSEC 50 Index             Taiwan             -321.19             -4.25%             7,231.61             9:13pm ET
Nikkei 225             Japan             -365.95             -4.02%             8,731.61             9:13pm ET


----------



## JWBooth

So where is the bottom?
Mining stocks a good/safe place to park money for the moment?


----------



## Zander

Burton Malkiel says it better than I can: 


> No one has ever become rich by being a long-term bear on the fortunes of the United States, and I doubt that anyone will do so in the future. This is still the most flexible and innovative economy in the world.



I will be getting back into stocks at some point in the near future. I have made double digit returns in long term treasuries and will re-balance soon.  I am long term bullish on America.  As Churchill said - "America will always do the right thing, but only after exhausting all other options". I think we are close to the point were we've exhausted all the other options. I see a wave of fiscal conservatism sweeping the nation.


----------



## Flopper

Ravi said:


> Flopper said:
> 
> 
> 
> 
> 
> Toro said:
> 
> 
> 
> Most likely.
> 
> Remember, a downgrade doesn't mean that the US will default.  It means that the probability of a default has risen.  And a decline from AAA to AA+ is a fairly minor increase in the perceived probability of a default.  That isn't a minimization of the downgrade, just a recognition of what a downgrade means.
> 
> Dow futures down 90 at 8:20.
> 
> 
> 
> Also keep in mind that Moody's, the largest bond rating service in world is not in agree with S&P, nor is Fitch.
> 
> Click to expand...
> 
> 
> So why did S&P downgrade? They certainly do not have a good track record and have admitted to making that 2 trillion dollar mistake.
> 
> How is it possible that a rating company with a bad track record can cause a world wide panic?
Click to expand...

IMHO, they were asleep at the switch in 2008 and wanted to be the first to alert their subscribers of a deterioration in US credit worthiness.  However, Moody&#8217;s and Fitch didn&#8217;t follow S&P&#8217;s lead, so S&P was left out in cold to justify their downgrade.  Instead of pointing to a rigorous financial analysis, they said their decision was based on a political analysis, which is not their forte.  

The markets were worried about a double dip and the debt problem both here and abroad so the ratings downgrade was all that was needed to get the ball rolling downhill.


----------



## Flopper

Ravi said:


> What if everyone wakes up tomorrow and realizes that since investors are flocking to US Treasuries, they are not a crap shoot? What happens to the panic then?


There is very little difference in terms of yield in a AAA and a AA+.  Also the bond rating services often differ in their opinion for issues rated this closely. To put this in perspective here is the definitions of S&P bond ratings.

AAA and AA:  High credit-quality investment grade
A and BBB:  Medium credit-quality investment grade
BB, B, CCC, CC, C: Low credit-quality (non-investment grade), or "junk bonds"  
D:  Bonds in default for non-payment of principal and/or interest

Read more: Bond Rating Definition

A, AA, and AAA are considered investment grade which means financial institutions such as, insurance companies, some banks, and pensions funds are permitted to invest their reserves because the possibility of default is extremely remote.


----------



## Baruch Menachem

From Pravda   ... Just to give us a little perspective.

Note about the text.   Israel regards Sunday as a regular work day, as the two biggest religions in the country count the sabbath as either Friday or Saturday, which is why Israel's market was open when the first.



> The economic crisis in the United States and the downgrade of the American credit rating has already affected the Russian reserves. The markets of Asia and Israel reacted to the news first. The setback was registered on the stock markets of Australia too. In Moscow, the RTS index lost two percent during the first ten minutes of the tender. The European Union and the United States may remember August 8th as the Black Monday.
> 
> According to experts' estimates, the downgrade of the US credit rating may mark the beginning of the new financial era. Global financial markets may wake up in a new world on Monday. Mohamed El-Erian, chief executive of Pacific Investment Management Co., or PIMCO, referred to the current situation as the "Sputnik Moment." He compared the reassessment of US financial positions to the shock, which the Americans experienced when the USSR launched its first satellite in 1957, in the midst of the Cold War.
> 
> Many other countries already begin to count the losses. Russia has already lost over 108 billion rubles because of the reduction of the US credit rating. Russia's Reserve Fund and the Fund of National Welfare have the following structure: 45 percent in dollars, 45 percent in euros and 10 percent in British pounds. The loss of a part of reserves is only a start, experts say. The crisis may exacerbate the situation on the world market of oil, which will inevitably strike a serious blow on the Russian economy.
> 
> 
> "The credit rating is an assessment of the risks to lose money. In this particular case, one may say that the rating was reduced post factum, so it reflects the losses that foreign investors have already suffered," Yevgeny Gavrilenkov, the chief economist of Troika Dialog private investment bank said.
> 
> "The losses are connected with the weakening of the dollar by 12-14 percent against world's major currencies. The weakening of the dollar means that Japan, for example, which holds nearly 900 billion dollars in US securities, has lost nearly 100 billion dollars," he said.


----------



## saveliberty

I think the major blood bath is passed for the next month or so.  No solid plan approval from Washington by mid October and all bets are off.


----------



## Quantum Windbag

JWBooth said:


> So where is the bottom?
> Mining stocks a good/safe place to park money for the moment?



The bottom is 0. My guess is it will not get anywhere near that.


----------



## william the wie

Just watched the Asian markets on Bloomberg. The term Lehman moment is becoming common the Korean exchange had what was described as a bad month in one day. Chinese economic data looks bad especially in regards to food inflation and particularly pork which is the major source of protein. (I thought it was soybeans but maybe the Chinese are using the tons of soybeans they import from South America to feed the pigs, I don't know.) Low skill wages are increasing much faster than inflation, while college labor is sinking. If China breaks that's about all she wrote.


----------



## DavidS

saveliberty said:


> I think the major blood bath is passed for the next month or so.  No solid plan approval from Washington by mid October and all bets are off.



Futures are down over 200...


----------



## Toro

Zander said:


> Burton Malkiel says it better than I can:
> 
> 
> 
> No one has ever become rich by being a long-term bear on the fortunes of the United States, and I doubt that anyone will do so in the future. This is still the most flexible and innovative economy in the world.
> 
> 
> 
> 
> I will be getting back into stocks at some point in the near future. I have made double digit returns in long term treasuries and will re-balance soon.  I am long term bullish on America.  As Churchill said - "America will always do the right thing, but only after exhausting all other options". I think we are close to the point were we've exhausted all the other options. I see a wave of fiscal conservatism sweeping the nation.
Click to expand...


I'm long term bullish too.

We've been through worse in America.  We'll get through this.


----------



## Toro

Futures have stabilized.  Dow futures were indicated at being down nearly 200 points last night.  At 6am, it looks near flat.

Gold is at $1770.


----------



## saveliberty

DavidS said:


> saveliberty said:
> 
> 
> 
> I think the major blood bath is passed for the next month or so.  No solid plan approval from Washington by mid October and all bets are off.
> 
> 
> 
> 
> Futures are down over 200...
Click to expand...


I see they are +80 this morning.  The market is oversold at the moment.  It is just a matter of bargain hunters over fear, or the other way around.


----------



## Douger

It'll come back. The smart ones will bail to foreign ETF's. That will put the numbers back up(on Wall Street). The rest of the world will re-adjust and carry on.......something that is impossible up there in DisneyWood.


----------



## Baruch Menachem

today might be a good day for a dead cat bounce.    Israel's stock exchange collapsed on on Sunday, but they had a big run up on monday.

Today will probably be an up day, but wednesday will be a real bloodbath.


----------



## saveliberty

Today is enough of a mystery.  Guessing at Wednesday is exactly that, a guess.


----------



## editec

The herd is stampeding off a cliff, again.

Have no fear, big capital is waiting near the bottom of the cliff to pick over the bones.

Cash is STILL king.


----------



## Baruch Menachem

Dow is up 200.   So is gold, which is up even more than yesterday.    I am pretty sure today is a dead cat bounce and tomorrow will see the real bloodletting.


----------



## Modbert

What a rally. Dow Jones was down almost 200 points less than 2 hours ago.

Finished up 430 points. Nasdaq is up over 150. S&P up over 50. Gold went up $20 from a high of about $50 or so at one point in the day.

What a crazy day.


----------



## Baruch Menachem

Most of the day up, a brief down bit, but right now up 165 or so.
Gold is way way up.


----------



## Toro

The Dow was up 638 points in the last 75 minutes of the day. 

This is nuts. It's a market run by machines and algos. 

If the rally continues, I expect it to fail, and will start looking for entry points on the short side. If we spend a few days consolidating at these levels, I will look to enter on the long side. But everything is a trade, and the market is treacherous.


----------



## saveliberty

Credit down grade, market reacted poorly.  Expected.

Market oversold, market recovers.  Expected.

I expect drifting until Europe has an issue or Congress stalls in spending cut talks.

Another +5.26% on the S&P and I'm a sideliner again.


----------



## Toro

We were as oversold as we were during the Financial Crisis. Given that the machines are in charge, I wouldn't be surprised to see another 800 points tacked back onto the Dow over the next few days. But again, if that happens, I will be shorting.


----------



## saveliberty

Toro said:


> We were as oversold as we were during the Financial Crisis. Given that the machines are in charge, I wouldn't be surprised to see another 800 points tacked back onto the Dow over the next few days. But again, if that happens, I will be shorting.



Yep, my cash position was very calming during this adminstration.  A quick 10% and I'm back to liquid.


----------



## bitterlyclingin

Somewhere near 50 per cent of market trading is computer directed, only thirty per cent of that is supervised by a human being.
The United States oil production industry is being shut down, The Gulf is shut.
Two billion US dollars went to Brazil to finance a George Soros oil exploration investment so that the United States can be Brazil's best customer. 
The EPA is busily regulating coal fired power plants out of existence.
Dodd-Frank has decreed that banks can no longer make money.
To say nothing of the $2,000 cash giveaway to whomever, first come first served, in Detroits Cobo Arena (You mean y'all forgot that?) during the early days of this presidency.
BAC's problems today stem largely from the Countrywide acquisition. Remember Chris Dodd and his below market rate "Friends of Angelo's" mortgage?
Countrywide was the organization that gave the $2900/ month income maid the $390,000 mortgage which she celebrated receiving by getting on a plane back to Poland and never, ever making a payment.
Countrywide was also the entity that gave the $1900/ month income waiter a $300,000 mortgage that he also never made a payment on.
Do we need any other reasons why BAC is bulldozing some of these homes it holds in foreclosure and turning the titles over to the cities? 100 such units to the City of Cleveland the last reporting period. Detroit is reporting sightings of black bears within the city limits.
There was a long period here of too much money chasing too few goods and services. You saw it in Holland in the Eighteenth century with its tulip mania, in the United States in the Roaring Twenties stock markets


----------



## Modbert

bitterlyclingin said:


> Somewhere near 50 per cent of market trading is computer directed, only thirty per cent of that is supervised by a human being.
> The United States oil production industry is being shut down, The Gulf is shut.
> Two billion US dollars went to Brazil to finance a George Soros oil exploration investment so that the United States can be Brazil's best customer.
> The EPA is busily regulating coal fired power plants out of existence.
> Dodd-Frank has decreed that banks can no longer make money.
> To say nothing of the $2,000 cash giveaway to whomever, first come first served, in Detroits Cobo Arena (You mean y'all forgot that?) during the early days of this presidency.
> BAC's problems today stem largely from the Countrywide acquisition. Remember Chris Dodd and his below market rate "Friends of Angelo's" mortgage?
> Countrywide was the organization that gave the $2900/ month income maid the $390,000 mortgage which she celebrated receiving by getting on a plane back to Poland and never, ever making a payment.
> Countrywide was also the entity that gave the $1900/ month income waiter a $300,000 mortgage that he also never made a payment on.
> Do we need any other reasons why BAC is bulldozing some of these homes it holds in foreclosure and turning the titles over to the cities? 100 such units to the City of Cleveland the last reporting period. Detroit is reporting sightings of black bears within the city limits.
> There was a long period here of too much money chasing too few goods and services. You saw it in Holland in the Eighteenth century with its tulip mania, in the United States in the Roaring Twenties stock markets



This is the Serious Stock Market Crash Thread. Not the let's fit as many talking points in one post thread.


----------



## bitterlyclingin

The Fed has also promised, today, to keep rates low until 2013. Que Pasa? Is Helicopter Ben telling us the economy's going to be in the toilet until then?


----------



## Trajan

Toro said:


> We were as oversold as we were during the Financial Crisis. Given that the machines are in charge, I wouldn't be surprised to see another 800 points tacked back onto the Dow over the next few days. But again, if that happens, I will be shorting.



this has really scrambled my chessboard. 

but the economic fundamentals are the fundamentals bernbanks missive means he expects the fundamentals to be weak hence the rate announcement, yes we knew that, the money that left will make its way back, slowly, but it will, but the market is still drunk right now, I am waiting for the hangover and then .......gold will still be in play 3 months from now despite any dips, stocks or gold, money has no where else to go..... QE3.


----------



## Toro

Modbert said:


> bitterlyclingin said:
> 
> 
> 
> Somewhere near 50 per cent of market trading is computer directed, only thirty per cent of that is supervised by a human being.
> The United States oil production industry is being shut down, The Gulf is shut.
> Two billion US dollars went to Brazil to finance a George Soros oil exploration investment so that the United States can be Brazil's best customer.
> The EPA is busily regulating coal fired power plants out of existence.
> Dodd-Frank has decreed that banks can no longer make money.
> To say nothing of the $2,000 cash giveaway to whomever, first come first served, in Detroits Cobo Arena (You mean y'all forgot that?) during the early days of this presidency.
> BAC's problems today stem largely from the Countrywide acquisition. Remember Chris Dodd and his below market rate "Friends of Angelo's" mortgage?
> Countrywide was the organization that gave the $2900/ month income maid the $390,000 mortgage which she celebrated receiving by getting on a plane back to Poland and never, ever making a payment.
> Countrywide was also the entity that gave the $1900/ month income waiter a $300,000 mortgage that he also never made a payment on.
> Do we need any other reasons why BAC is bulldozing some of these homes it holds in foreclosure and turning the titles over to the cities? 100 such units to the City of Cleveland the last reporting period. Detroit is reporting sightings of black bears within the city limits.
> There was a long period here of too much money chasing too few goods and services. You saw it in Holland in the Eighteenth century with its tulip mania, in the United States in the Roaring Twenties stock markets
> 
> 
> 
> 
> This is the Serious Stock Market Crash Thread. Not the let's fit as many talking points in one post thread.
Click to expand...


----------



## Toro

Trajan said:


> Toro said:
> 
> 
> 
> We were as oversold as we were during the Financial Crisis. Given that the machines are in charge, I wouldn't be surprised to see another 800 points tacked back onto the Dow over the next few days. But again, if that happens, I will be shorting.
> 
> 
> 
> 
> this has really scrambled my chessboard.
> 
> but the economic fundamentals are the fundamentals bernbanks missive means he expects the fundamentals to be weak hence the rate announcement, yes we knew that, the money that left will make its way back, slowly, but it will, but the market is still drunk right now, I am waiting for the hangover and then .......gold will still be in play 3 months from now despite any dips, stocks or gold, money has no where else to go..... QE3.
Click to expand...


They're trying to square the circle.  The Bernank wants to provide liquidity without providing QE3.  The statement was pretty clever, really.  But I think it will ultimately fail.

Because the robots all have "stocks up/gold down" written in their algorithms, strength in stocks will mean weakness in gold in the near term.  Assuming nothing happens overnight, I plan on shorting gold in the morning for the next few weeks.  But I expect to get back in later in the year.


----------



## Trajan

this long term announcement for rates will ultimately again, just drag this out.

 we need to take our medicine. At least Carter was smart enough to hire Volcker and Reagan was smart enough to listen to him.....despite the political damage he took.


----------



## william the wie

Toro said:


> They're trying to square the circle.  The Bernank wants to provide liquidity without providing QE3.  The statement was pretty clever, really.  But I think it will ultimately fail.
> 
> Because the robots all have "stocks up/gold down" written in their algorithms, strength in stocks will mean weakness in gold in the near term.  Assuming nothing happens overnight, I plan on shorting gold in the morning for the next few weeks.  But I expect to get back in later in the year.


Try Gold mining stocks long. The computers can't make sense of what to do with them. Right now I wouldn't trust turnaround Tuesday on your life, much less mine, and I do mean either way. Wait and see what happens. Last night I saw the EU turn red as I watched Bloomberg. The US futures were green right up to that moment too.


----------



## saveliberty

Wild swings will probably be the norm for awhile.  Hopefully we see a drop at the open and then some play back and forth across neutral.  I held back 33% of what I planned to invest in case we got a drop today.


----------



## KissMy

60% of US Treasuries will come due in the next 3 years. By the FED vowing to keep rates low by buying them, they could effectively monetize a huge chunk of the US debt.

 Lets hear it for Gold!


----------



## saveliberty

I suppose my ring from wife one could finally be worth something.


----------



## JWBooth

Hmm open an hour and yesterday's gains are all but gone.


----------



## Trajan

god I LOVE IT and I love being right...

down 3.5%  7:24 pac time...but hey, it could end  in a draw...but I doubt it....the fundamentals don't lie, the global economy is sick, time to take some cash sit back and let the corps scramble to meet this new set up for the remainder of what was supposed to be a semi recovery back end of the year. 

Liquidating my 55% gains in gold, turn that over into 3 blue chips I have my eye on right now..... buy and hold for the duration, ....just.... not.....quite....yet.....

my version of the market right now;


[ame=http://www.youtube.com/watch?v=0IBZocFkXGY&feature=related]&#x202a;Sister Daughter Chinatown.flv&#x202c;&rlm; - YouTube[/ame]


----------



## saveliberty

I will make a prediction that we close above 11,000 today.


----------



## KissMy

saveliberty said:


> I will make a prediction that we close above 11,000 today.



Not unless a Central Bank creates more money.


----------



## JWBooth

saveliberty said:


> I will make a prediction that we close above 11,000 today.



Based on?


----------



## BoycottTheday

My prediction is people are going hunting for gold in every creek in dem dar hills.


----------



## Toro

I have not shorted gold but will continue to monitor at these levels. 

Stocks have been hammered on concerns regarding French banks. However, they are holding their lows. More bad news on the banks and stocks will slice through the lows. But for now, they appear to be holding. If they continue to hold, the next big move is likely to the upside. 

Also, there are other big problems in the European banking system no one is talking about.


----------



## Trajan

Toro said:


> I have not shorted gold but will continue to monitor at these levels.
> 
> Stocks have been hammered on concerns regarding French banks. However, they are holding their lows. More bad news on the banks and stocks will slice through the lows. But for now, they appear to be holding. If they continue to hold, the next big move is likely to the upside.
> 
> Also, there are other big problems in the European banking system no one is talking about.



check the Euro thread I am on it,  and would have added more but no one seemed interested....


----------



## KissMy

If the market turns I am thinking of shorting the DXD. These ETF's have a 8%+ negative bias over time.


----------



## Toro

Europe closes and the market rips higher. 

Toronto is well into the green and exhibiting the type of pattern I like to see at bottoms. Canada has often been a precursor to the US markets.


----------



## Toro

WooWee!  That is one butt ugly market!  

Not much good to say other than we didn't break through yesterday's lows.  Canada also finished positive. But banks hit new lows and the market closed on the lows. I want to do something but I'm just sitting on my hands mostly in cash.


----------



## Trajan

saveliberty said:


> I will make a prediction that we close above 11,000 today.



you meant 10K right?  

what a friggin beating....heh..better nail those windows closed...

I'll personally commit to cleaning up the mess of any Goldman Ghoul that takes the plunge.....


----------



## JWBooth

saveliberty said:


> I will make a prediction that we close above 11,000 today.



Better luck tomorrow.


----------



## KissMy

Ouch!

I tried to catch a falling knife today & lost a finger. I shorted the 1,500 shares of the DXD at $21.50.

After listening to the Elliot Wave guy on CNBC it makes you think that stock prices will erode until 2016. The market fell off after that.


----------



## JWBooth

Trajan said:


> saveliberty said:
> 
> 
> 
> I will make a prediction that we close above 11,000 today.
> 
> 
> 
> 
> you meant 10K right?
> 
> what a friggin beating....heh..better nail those windows closed...
> 
> I'll personally commit to cleaning up the mess of any Goldman Ghoul that takes the plunge.....
Click to expand...


The correction has been held off with TARP and the QEs seems to have its nose under the tent.


----------



## saveliberty

JWBooth said:


> saveliberty said:
> 
> 
> 
> I will make a prediction that we close above 11,000 today.
> 
> 
> 
> 
> Better luck tomorrow.
Click to expand...


If it goes down more, I can just buy more.   Not retiring for a long time.


----------



## iamwhatiseem

The gathering opinions seem to indicate another 700-1000 fall is likely before reaching bottom. My thoughts recently have been waiting till it gets below 10,900 and stays below that for 48 hours. I have changed that to 10,200 in light of even worse news out of Europe.
 The biggest fear out there is that France and other EU banks are in "2008 mode". That is to say they have hid their true financial shape and it is terrible. This of course would be disastrous. Europe does not have the capital to fix the problem and would drag their economy down for a decade or more...thus dragging our down as well.

I don't know...I have been surprised for 2 years now that the DOW reached near 13000 pts - to me another obvious bubble in the making.

It's a real problem...perhaps now we will face the problem for what it is, and deal with it in a manner that relieves pain - not tries to fix it in a pen stroke.


----------



## HenryBHough

Dow at 7500 is magic.

Wait for it.

Won't be long.


----------



## alexjones

can someone tells us what's really going on?!


----------



## KissMy

alexjones said:


> can someone tells us what's really going on?!



We are Japan 20 years ago. We also have Boomer's retiring cashing in on their investments & demanding their entitlements. Oh & Europe is screwing everyone.


----------



## iamwhatiseem

KissMy said:


> alexjones said:
> 
> 
> 
> can someone tells us what's really going on?!
> 
> 
> 
> 
> We are Japan 20 years ago. We also have Boomer's retiring cashing in on their investments & demanding their entitlements. Oh & Europe is screwing everyone.
Click to expand...


That is certainly part of it.
The world went through a significant liberal phase from the late 1950's - 1980.
During this phase countries built up very large entitlement programs during this same period the population exploded. Unreal isn't it? That no one back then had the honesty to realize what this would do.
Take the above scenario and now add their children -  Gen X's. Self absorbed and spoiled rotten and wanting everything their parents have and a helluva lot more - all this before they have their first child! When their income wouldn't hack it - fine - they borrowed their future earnings, counting on raises and promotions years before they MIGHT happen.
Insanity.
And now we have a government who is STILL trying to pretend the problem isn't as big as it is. 
We should pray they do and not continue to make it worse.


----------



## william the wie

Somewhat disagree. There are numerous AAA countries with higher CDS rates than the US. By that measure France is no better BBB, the UK as well. Those downgrades are coming soon my guess is 1-2 weeks from this Friday.


----------



## DavidS

What's going on? Europe is in terrible debt, America is in terrible debt. We are all in debt because of low taxes and high spending. If we cut spending and raised taxes, we would be much better off. However, the Tea Party morons who each deserve to be tried for treason, held the House of Representatives Hostage on this debt deal and would not back any bill that raised taxes for the wealthy. In other words, if you take home 1 million dollars a year after all deductions and before taxes, the Tea Party morons don't want you to lose out on an additional 5% of your income because they fear you won't create jobs. Of course the taxes were lowered under Bush and our economy was sluggish at best during Bush's terms so tax cuts have really done nothing good for us.


----------



## Toro

I think the market is trying to bottom here. I am looking to get long. However, I expect we will retest the lows within the next few months.


----------



## martybegan

DavidS said:


> What's going on? Europe is in terrible debt, America is in terrible debt. We are all in debt because of low taxes and high spending. If we cut spending and raised taxes, we would be much better off. However, the Tea Party morons who each deserve to be tried for treason, held the House of Representatives Hostage on this debt deal and would not back any bill that raised taxes for the wealthy. In other words, if you take home 1 million dollars a year after all deductions and before taxes, the Tea Party morons don't want you to lose out on an additional 5% of your income because they fear you won't create jobs. Of course the taxes were lowered under Bush and our economy was sluggish at best during Bush's terms so tax cuts have really done nothing good for us.



Please show me where the treason is in not wanting to increase the debt limit, or not increasing it without massive spending cuts in return, while not increasing taxes.

I'll be waiting.


----------



## Truthmatters

It wont work.

You have to spurn the economy on and raise taxes to get the revenue you need to fix this mess.


----------



## Toro

Guys

Please take the political stuff to the other thread. 

Thanks. Much appreciated.


----------



## editec

The market goes *inexplicably down hundreds of points one day, then it goes inexplicably up hundreds of points the next day.

_SOMEBODY_ is making a whole lotta money on these radical moves of the markets, folks.

*The sheep are getting sheared again.*

* (oh I know people always have explainations after the fact. Of course usally their explainations make no sense because what they claim is the cause was in effect the day before the rapid drip or climb in the market, too).

Animal spirits, folks.

The herd gets stampeded once in while, and I do not think that_ everybody_ is surprised when that happens.

Not everybody is surprised, just _most investors._


----------



## saveliberty

My account is growing.  I expect we will be back near 12200 in about three weeks.  The market will all your problem at that point.  I'll be back in cash.


----------



## KissMy

Europe discovered they had a serious economic slowdown. Even Europe's economic engine Germany has slowed to a crawl. I got in & made $5,000 on on this 3 day bear market bounce but I am pulling my money back out of the market soon & going back into Gold.

There is now a greater risk than not of a double dip recession.


----------



## Toro

I have been buying stock over the past few days. I think this is a bear market bounce and we will go back and eventually retest the lows but I think we have more to go on the upside.  The market is acting pretty well despite the lousy numbers from Germany. 

FTR the RSI of the Russell 2000 went lower last week than at any time during the Financial Crisis.


----------



## CrusaderFrank

Look out below! 

The Fed can keep it propped up for a while, no doubt. But the EU is in total shambles and the USA still has an Economic Jihadist in the WH for at least the next 16 months and that's without the Middle East throwing a match in the dynamite shed.  Obama's got us in 6 wars, how do you this plays out?

US Treasuries will continue to rise because there's no other place on the planet where you have a chance of actually getting your money back


----------



## Steve Hanson

Investing in the market as a whole right now is far too risky. At best, select a few individual companies that are performing well.


----------



## mal

Steve Hanson said:


> Investing in the market as a whole right now is far too risky. At best, select a few individual companies that are performing well.



And buying Gold @ this Price, and towards the Middle to End of this Generational Correction, is not Wise either...

See how Gold did after Peaking @ $800 an oz at the End of the Last Generational Correction in 1983...

Dumped to 300ish and sat there for Decades.

Careful with that Gold Axe, Ugene...



peace...


----------



## KissMy

Toro said:


> I have been buying stock over the past few days. I think this is a bear market bounce and we will go back and eventually retest the lows but I think we have more to go on the upside.  The market is acting pretty well despite the lousy numbers from Germany.
> 
> FTR the RSI of the Russell 2000 went lower last week than at any time during the Financial Crisis.



I am to affraid to ride this bounce any further despite the RSI. The RSI was below 50 just before we had the largest point drop in history. Gold is safer than the markets or dollars. I just closed out my short on the DXD at $19.27

The Dow to Gold ratio is headed somewhere between 1:1 & 5:1.


----------



## Toro

KissMy said:


> Toro said:
> 
> 
> 
> I have been buying stock over the past few days. I think this is a bear market bounce and we will go back and eventually retest the lows but I think we have more to go on the upside.  The market is acting pretty well despite the lousy numbers from Germany.
> 
> FTR the RSI of the Russell 2000 went lower last week than at any time during the Financial Crisis.
> 
> 
> 
> 
> I am to affraid to ride this bounce any further despite the RSI. The RSI was below 50 just before we had the largest point drop in history. Gold is safer than the markets or dollars. I just closed out my short on the DXD at $19.27
> 
> The Dow to Gold ratio is headed somewhere between 1:1 & 5:1.
Click to expand...


That's looking good now. 

Near as I can tell, the press conference was a complete waste.  Worse, they talked about a transaction tax. Europe is even more clueless than us. 

Watch for a European bank to fail.


----------



## KissMy

Toro said:


> That's looking good now.
> 
> Near as I can tell, the press conference was a complete waste.  Worse, they talked about a transaction tax. Europe is even more clueless than us.
> 
> Watch for a European bank to fail.



If I had any balls right now I would short the DDM.


----------



## Toro

I bought into the close. The last 20 minutes saw a selloff, but for the most part, the day was pretty good. Or at least it wasnt bad. We had two pieces of pretty bad news today which initially caused a selloff but was then bought. Technically, the indices are in a near term uptrend as today's trading range held above yesterday's, which was above Friday's. On the minus side, Canada closed at the lows and went below yesterday's trading range. However, oil hit a weekly high though stocks did not.


----------



## william the wie

What about all the death crosses (50 day ma crossing the 200 day ma downward) in all major indices?


----------



## Toro

william the wie said:


> What about all the death crosses (50 day ma crossing the 200 day ma downward) in all major indices?



It's at 1280 on the SP500. The SP500 is at 1192. There is serious resistance ~1250. I plan to sell before there.


----------



## Full-Auto

Toro said:


> william the wie said:
> 
> 
> 
> What about all the death crosses (50 day ma crossing the 200 day ma downward) in all major indices?
> 
> 
> 
> 
> It's at 1280 on the SP500. The SP500 is at 1192. There is serious resistance ~1250. I plan to sell before there.
Click to expand...


The dow is down

The Bob Rivers Show with Bob Spike and Joe


----------



## saveliberty

Iz up 5% in a week, looking to sell and wait on the October blood bath.


----------



## Toro

The XLU has recovered all it's losses from the crash.


----------



## KissMy

People are not going to rush back into stocks. Any day now another crisis in Europe will take the market down another notch.

39% of Americans believe the current economic downturn is part of a long-term permanent decline and the economy will never fully recover.


----------



## Toro

KissMy said:


> People are not going to rush back into stocks. Any day now another crisis in Europe will take the market down another notch.
> 
> 39% of Americans believe the current economic downturn is part of a long-term permanent decline and the economy will never fully recover.



People have been withdrawing for the past decade.  It became especially acute in 08-09 during the Financial Crisis.  Doesn't mean can't have some good rip-your-face-off rallies though.  After all, its the machines that control things now.


----------



## mal

Toro said:


> KissMy said:
> 
> 
> 
> People are not going to rush back into stocks. Any day now another crisis in Europe will take the market down another notch.
> 
> 39% of Americans believe the current economic downturn is part of a long-term permanent decline and the economy will never fully recover.
> 
> 
> 
> 
> People have been withdrawing for the past decade.  It became especially acute in 08-09 during the Financial Crisis.  Doesn't mean can't have some good rip-your-face-off rallies though.  After all, its the machines that control things now.
Click to expand...


Once this Generational Correction has Faded the Market will Consistently Climb...

and Gold will shit the bed. 

Just like after the last one in 1983.



peace...


----------



## Truthmatters

so how does this bode for privatizing SS?


----------



## mal

Truthmatters said:


> so how does this bode for privatizing SS?



Social Security is Doomed... the Boom Generation will Expose it for what it was Warned to be way back in the Day...

One can only Hope that all of the Drugs and bad shit they did will Knock them off Sooner rather than Later...

It's really our only Hope.



peace...


----------



## Immanuel

Truthmatters said:


> so how does this bode for privatizing SS?



Actually, it should prove to the intelligent individual that even in the worst of times, the market doesn't drop to zero and all is not lost.  

Only an idiot puts all their eggs in one basket.  Likewise only an idiot pulls all of their money out of the market during a temporary set back.  Likewise only an idiot would retire today and yank all of their money out of the market the next day especially when the market was down.

To me this is more proof that privatized SS would be good for the country.

Privatization of SS does not mean someone should be choosing individual stocks and bonds for their accounts, it simply means that when they retire, the money is theirs and if they should pass away weeks before retirement that their family is actually provided for rather than left out in the cold to rot.

Immie


----------



## TruthSeeker56

mal said:


> Toro said:
> 
> 
> 
> 
> 
> KissMy said:
> 
> 
> 
> People are not going to rush back into stocks. Any day now another crisis in Europe will take the market down another notch.
> 
> 39% of Americans believe the current economic downturn is part of a long-term permanent decline and the economy will never fully recover.
> 
> 
> 
> 
> People have been withdrawing for the past decade.  It became especially acute in 08-09 during the Financial Crisis.  Doesn't mean can't have some good rip-your-face-off rallies though.  After all, its the machines that control things now.
> 
> Click to expand...
> 
> 
> Once this Generational Correction has Faded the Market will Consistently Climb...
> 
> and Gold will shit the bed.
> 
> Just like after the last one in 1983.
> 
> 
> 
> peace...
Click to expand...


The big "elephant" in the room that people are acknowledging, and constantly referring to, is the elephant named "Precedence".

There is ANOTHER "elephant" in the room that is trying to emerge from the shadow of the first elephant.  His name is "uncharted territory".

Precedence, aka "living in the past", will DESTROY those "don't worry about it" people who are foolishly using past stock market trends, past economic history, and past precious metals trends to soothe the people who have every reason to be very worried about their financial future and their retirement income.

The supporters of "precedence" are ignoring the other "elephant" in the room:  

1. They are ignoring the record $14+trillion debt.  
2. They are ignoring the record $1.6 trillion budget deficit.  
3. They are ignoring the flooding of our economy with paper promises.  
4. They are ignoring the fact that 90+% of the U.S. GDP is being used to service our debt.
5. They are ignoring the fact that the U.S. stock market is built on a foundation of paper, because the SEC is just as complicit as the investment banks and shorts and day traders and all of the other profiteers and carpetbaggers who control Wall Street.
6. They ignore the fact that gold and silver are the ONLY true sources of monetary stability, and the gold and silver "boom" is mostly derived from a simple case of SUPPLY and DEMAND.
7. They ignore the fact that most of Europe is in dire economic straits.
8. They refuse to acknowledge the fact that the USA is also in dire economic straits.

The FACT of the matter is, there is NO PRECEDENCE that can be used, in good conscience, to predict what will happen to the U.S. stock market in the next several days, or what will happen to the U.S. economy in the next several months.

The stock market is going to fall, and fall HARD.  Gold and silver will continue to increase in value, because enough people, and enough countries, understand that the U.S. dollar is going down the drain, and the U.S. dollar will not recover.

When Bernanke and the Federal Reserve started their Quantitative Easing charade (QE1 and QE2) it marked the beginning of the end of the Federal Reserve system.

Let the stock market proponents keep their "eggs in one basket".  Let them watch in horror as their 401Ks and mutual funds and individual stocks lose value day in and day out.  They will ultimately pay a horrible price for their shortsightedness and GREED.


----------



## Toro

The market is acting very poorly today. The Dumb Money pushed the market higher in the first hour but it has been sold ever since. The Smart Money jumped in at 2pm to find a bottom but it's struggling. The bounce off the lows last week is hanging by a thread. Any further weakness and I will liquidate my positions and wait for a firmer bottom.


----------



## KissMy

Toro said:


> KissMy said:
> 
> 
> 
> People are not going to rush back into stocks. Any day now another crisis in Europe will take the market down another notch.
> 
> 39% of Americans believe the current economic downturn is part of a long-term permanent decline and the economy will never fully recover.
> 
> 
> 
> 
> People have been withdrawing for the past decade.  It became especially acute in 08-09 during the Financial Crisis.  Doesn't mean can't have some good rip-your-face-off rallies though.  After all, its the machines that control things now.
Click to expand...


Another poll that = bad news for the market.






The Gold to Dow ratio is defiantly going to go to less than 5:1. We may even be heading for a re-test of the 2009 lows.


----------



## Toro

It looks like the crash is continuing this morning.  I will cut my losses and exit.

Signs of stress in the inter-bank markets continue.  Interestingly, with the exception of Greece, CDS on all the PIIGS has fallen over the past few days.  But that may have been a headfake.

http://www.cnbc.com/id/44185339


----------



## BoycottTheday

Tell ya what, put in a business friendly Administration and you'll look stupid for not buying anything not nailed down. 

Give Obama another term and you might as well turn the lights out.

Id say the old school advice of 80% in safe secure investments and 20% in risky ones like todays market still works.

Why people put 100% of their investments in the market or one kind of investment is beyond me.


----------



## Toro

BoycottTheday said:


> Tell ya what, put in a business friendly Administration and you'll look stupid for not buying anything not nailed down.
> 
> Give Obama another term and you might as well turn the lights out.
> 
> Id say the old school advice of 80% in safe secure investments and 20% in risky ones like todays market still works.
> 
> Why people put 100% of their investments in the market or one kind of investment is beyond me.



Stocks have done better (so far) under Obama than they did under Bush. In fact, returns to stocks under Bush were near the lowest of any President since the Depression. 

Now I'm not blaming Bush and praising Obama. Far from it. But in truth, many other factors outweigh who is in power affecting stock returns.

I do agree that most people should right now be in safe assets for anything other than the very long term.


----------



## BoycottTheday

The small investor just needs to know everything is stacked against them

You cant compete with the machines and those close to the action.

Make smart investments and stick with them, if 80% of your assets are in safe secure investments, the 20% you are risking for the big payout wont kill ya if you make a wrong bet, sure try gold stocks or pork bellies with the 20%.


The bottom line is if you cant sleep at night worrying

 you are in the wrong investment.


----------



## KissMy

I see so many people who think gold will peak as in the 1970's & drop like a stone. This is not the 70's unsubstantiated gold panic. Back in the 70's we had a huge Social Security trust fund to raid & we only had a Debt to GDP ratio of 30%. We had the productive boomer workforce to carry the load.

Today the Debt to GDP ratio is 100%, the SS trust fund has been raided, unfunded liabilities are $115 trillion & the boomer's are now a drag. There is no question that the dollar will fall, taxes will rise & benefits will be rationed. There are not enough investments to provide for the retiring boomer's. They now need to live on their investments & are pulling their money.


----------



## Toro

I agree. 

I closed my trade this morning at a loss and continued buying silver that I started earlier in the week. I like silver here more than gold.

Bank problems in Europe and the horrible Philly Fed number are hammering the market this morning.


----------



## Trajan

> my strategy was/is jumping in on the yearly lows; P&G, J&J I'll bottom at 58,
> 
> 
> 
> full disclosure; I have lock in on Adobe at 22 and Intel at 19.
> 
> WMT was triggered today.



that was last wed. soooo the market is tanking again. *rubs hands with glee*...yes my pretties.....

Procter and Gamble locked at 60.25....I took on Adobe at 23.....junked my own rule....but its a 35 stock, no doubt, Intel? won't drop to 19, at least not to day, its a  dividend only stock, hummm, no I won't change my buy, 19 or bust. 
J&J, nope, not yet. 

theres always tomorrow..the European bank issue is imho, just getting warmed up......


----------



## Toro

I have discussions with a friend on INTC.  He wants to buy it here because of the dividend.  I trade semis off book value.  Divy is 4%, pretty good.  However, a bottom in book value is about $15.  Stock has held up pretty well, all things considered.  It will be interesting to see where it bottoms.


----------



## editec

All I know is this:

The market can stay IRRATIONAL longer than most of us can stay SOLVENT.

Now seriously...who among us, as we watched the price of real estate climbing at rates 5 or 6 times the rate of inflation NOT know that RE was in a bubble?

I'm guessing a lot of people on this board KNEW the market was nuts.

Hell folks, the price of RE been nuts since AT LEAST the early 90s.

But year after year the RE market continued to climb despite all the fundamentals.

Now I do not doubt that many of us saw that, but who among us TIMED it correctly?

And if you DID time the market, what event finally tipped you off that it was time to bail?


----------



## KissMy

editec said:


> All I know is this:
> 
> The market can stay IRRATIONAL longer than most of us can stay SOLVENT.
> 
> Now seriously...who among us, as we watched the price of real estate climbing at rates 5 or 6 times the rate of inflation NOT know that RE was in a bubble?
> 
> I'm guessing a lot of people on this board KNEW the market was nuts.
> 
> Hell folks, the price of RE been nuts since AT LEAST the early 90s.
> 
> But year after year the RE market continued to climb despite all the fundamentals.
> 
> Now I do not doubt that many of us saw that, but who among us TIMED it correctly?
> 
> And if you DID time the market, what event finally tipped you off that it was time to bail?



I sold a house in Tampa, Florida at the end of 2004 for 2-1/2 times the price I paid in 1996. I knew there was a huge bubble. It took over a year later for the bubble to pop. Real-estate moves way slower than stocks. For over a year all my friends & family told me I was tin foil hat crazy. I now own 4 houses combined that cost me less than what I sold that one for. The rent checks from those same family members are a nice dividend.

I can tell you right now there is an entitlement bubble. Government spending is now 47% of the economy. This translate into a dollar bubble. Gold is not a bubble but the dollar & government are a bubble.


----------



## Ravi

It looks more likely that the upcoming austerity is figuring into the market performance.



> Morgan Stanley cut its estimate for growth in the Group of 10 nations to 1.5 percent this year and next, down from previous forecasts of 1.9 percent in 2011 and 2.4 percent in 2012, todays report showed.
> 
> A negative feedback loop between weak growth and soggy asset markets now appears to be in the making in Europe and the U.S., the analysts said. This should be aggravated by the prospect of fiscal tightening in the U.S. and Europe.



Morgan Stanley Cuts Global Growth Forecast With U.S.


----------



## KissMy

Ravi said:


> It looks more likely that the upcoming austerity is figuring into the market performance.
> 
> 
> 
> 
> Morgan Stanley cut its estimate for growth in the Group of 10 nations to 1.5 percent this year and next, down from previous forecasts of 1.9 percent in 2011 and 2.4 percent in 2012, todays report showed.
> 
> A negative feedback loop between weak growth and soggy asset markets now appears to be in the making in Europe and the U.S., the analysts said. This should be aggravated by the prospect of fiscal tightening in the U.S. and Europe.
> 
> 
> 
> 
> Morgan Stanley Cuts Global Growth Forecast With U.S.
Click to expand...


There is not now, nor will there be fiscal tightening in the U.S. We have $115 trillion in unfunded liabilities.

Logic dictates a 3 prong approach to correcting the $115 trillion in unfunded liabilities.

Increase taxes to cover $38.4 trillion.
Print money to cover $38.4 trillion.
Cut expected entitlements by $38.4 trillion.

This still grows spending by $76.8 trillion beyond current levels.


----------



## KissMy

39% of Americans believe the current economic downturn is part of a long-term permanent decline and the economy will never fully recover.


----------



## Zander

The 11% must all be government employees....


----------



## Trajan

Toro said:


> I have discussions with a friend on INTC.  He wants to buy it here because of the dividend.  I trade semis off book value.  Divy is 4%, pretty good.  However, a bottom in book value is about $15.  Stock has held up pretty well, all things considered.  It will be interesting to see where it bottoms.



I have followed intel for years, since the early to mid 90's, after their last split in 2000 I think it was, the upside price for buy and hold was gone, the dividend is the only 'profit' you'll see if you are not a day trader,  which I am not...its flat, I think it topped at 27 in 07 and dropped back to its early 2000 performance, ranging between 18 and 23 avg....thats that. 

Its funny, they have grown to the point where in, their tick tock 2 year windows for new design and pushing its own performance envelope has locked it up at the 85% market share level, they will NOT go beyond that except in fits and starts, they are afraid of the Microsoft image ala monopolistic market share which draws gov. as in EU and US law suits etc...they have had their share of those to, the EU whacked them for rebating etc.....stupid.

Despite being an extremely well run co., money in the bank, pretty much flawless performance and execution to plan,   they won't ever see price growth, they have tried buy backs, etc.....they are stuck.


----------



## iamwhatiseem

I don't like diving in and out, which is why I didn't buy last week...and still not now.
I did freaking amazing in 2009...I want a repeat..c'mon market...let's crashhhhhhh...
I am hoping for 4 figures.


----------



## Trajan

fine by me.


----------



## william the wie

I suspect the real carnage is at least 60 days away.


----------



## Trajan

william the wie said:


> I suspect the real carnage is at least 60 days away.



I am thinking you may be thinking thats how long it will take for the euro banks to be exposed for the way over exposed drunks they are?


----------



## iamwhatiseem

You got European exposure
You got toxic assets the banks still have on the books in America
You got U.S. home construction lowest since 1971
You got reeeeaaallly nervous mid west manufacturing that is bleeding right now which are normally earning months...this is critical.

You got the makings of 2008...yes I said it.


----------



## BoycottTheday

If the underground economy had a stock market, whats the odds it would be booming right now?


----------



## william the wie

Possibly 2008 was a dress rehearsal for what is coming next.


----------



## KissMy

OPEC cut production by 1 million barrels per day last quarter. They knew the recession was coming. World oil production is down by that same 1 million barrels per day last quarter. We are going to have at least 1 flat or negative quarter. OPEC is on top of oil regulation this time so oil prices will not crash to $33 unlike the last recession. There is also a huge difference in WTI vs Brent oil prices. Our imported oil is costing us $107 vs our news headline price of $82.


----------



## Toro

Oil touched below $80 and rallied. Europe is rallying off the lows this morning on what appears to be technical buying. This has caused a a retreat off the highs in precious metals.


----------



## editec

mal said:


> Truthmatters said:
> 
> 
> 
> so how does this bode for privatizing SS?
> 
> 
> 
> 
> Social Security is Doomed... the Boom Generation will Expose it for what it was Warned to be way back in the Day...
Click to expand...

 
If SSI is doomed?

So too is the rest of the economy.



> One can only Hope that all of the Drugs and bad shit they did will Knock them off Sooner rather than Later...
> 
> It's really our only Hope.
> 
> 
> 
> peace...


 
Keep hoping, Lad.


----------



## iamwhatiseem

Toro said:


> Oil touched below $80 and rallied. Europe is rallying off the lows this morning on what appears to be technical buying. This has caused a a retreat off the highs in precious metals.



Pure anarchy is what it is. 
I run a business, so I don't have the time to track stocks day after day like this...I prefer to invest/cash out at opportunities only a couple times a year. With this kind of insane day to day falling and recovering - my dough is just sitting idle. Just get the freakin down adjustment over with so I can invest back in already 
I did almost 40% in 2009..about 10% in 2010...and it has been sitting out this whole year as I have been expecting this bubble to pop all year now. 

[and here comes the post about how this evil conservative wants the economy to crash)


----------



## Toro

iamwhatiseem said:


> Toro said:
> 
> 
> 
> Oil touched below $80 and rallied. Europe is rallying off the lows this morning on what appears to be technical buying. This has caused a a retreat off the highs in precious metals.
> 
> 
> 
> 
> Pure anarchy is what it is.
> I run a business, so I don't have the time to track stocks day after day like this...I prefer to invest/cash out at opportunities only a couple times a year. With this kind of insane day to day falling and recovering - my dough is just sitting idle. Just get the freakin down adjustment over with so I can invest back in already
> I did almost 40% in 2009..about 10% in 2010...and it has been sitting out this whole year as I have been expecting this bubble to pop all year now.
> 
> [and here comes the post about how this evil conservative wants the economy to crash)
Click to expand...


I appreciate you sharing this. It is a common refrain from retail investors.


----------



## KissMy

iamwhatiseem said:


> Toro said:
> 
> 
> 
> Oil touched below $80 and rallied. Europe is rallying off the lows this morning on what appears to be technical buying. This has caused a a retreat off the highs in precious metals.
> 
> 
> 
> 
> Pure anarchy is what it is.
> I run a business, so I don't have the time to track stocks day after day like this...I prefer to invest/cash out at opportunities only a couple times a year. With this kind of insane day to day falling and recovering - my dough is just sitting idle. Just get the freakin down adjustment over with so I can invest back in already
> I did almost 40% in 2009..about 10% in 2010...and it has been sitting out this whole year as I have been expecting this bubble to pop all year now.
> 
> [and here comes the post about how this evil conservative wants the economy to crash)
Click to expand...


All you can do is come up with the SHTF level that you believe is a great price for stock. Then set your triggers at those levels & let the market come to you. Don't worry, this wild market will come to you & execute your trade.


----------



## ShackledNation

My guess is the stock market will rally a little bit again, and then come tumbling down back to very low levels. The inflationary monetary policies of the Federal Reserve simply cannot work forever. Not to mention there are trillions of dollars overseas being held by foreigners. When they start to lose faith in the dollar, dollars will pour back into the US, causing serious inflation. When banks start loaning again, there will also be inflation.

Gold and silver are good choices in this economy, IMO.


----------



## Toro

It looks like the market wants to retest the lows.


----------



## KissMy

Toro said:


> It looks like the market wants to retest the lows.



If the Dow only goes down to last weeks low of 10,662, that means gold must at least hit $2,133. I think the Dow is headed below 10,000. It will get to where less than 5oz of gold = the Dow. We will have a negative or flat quarter, but we will not have the aid of cheap oil to help us out this time because OPEC cut production last quarter. This time it is going to be rough.


----------



## iamwhatiseem

You guys catch one of the chief economist for JP on Cavuto a few minutes ago?
As you all know JP downgraded estimated growth for Q4 to basically flat.
When asked 'when it is this close to zero...what would it take to see negative growth for the 4th quarter?" 
"There is certainly an elevated risk of that, it won't take much...things are not looking good".


----------



## KissMy

iamwhatiseem said:


> You guys catch one of the chief economist for JP on Cavuto a few minutes ago?
> As you all know JP downgraded estimated growth for Q4 to basically flat.
> When asked 'when it is this close to zero...what would it take to see negative growth for the 4th quarter?"
> "There is certainly an elevated risk of that, it won't take much...things are not looking good".



Third quarter will be flat to negative, then the government will step in to save the fourth quarter. Stimulus 2.0 is coming in September. Until then we are going to retest the lows.


----------



## iamwhatiseem

KissMy said:


> iamwhatiseem said:
> 
> 
> 
> You guys catch one of the chief economist for JP on Cavuto a few minutes ago?
> As you all know JP downgraded estimated growth for Q4 to basically flat.
> When asked 'when it is this close to zero...what would it take to see negative growth for the 4th quarter?"
> "There is certainly an elevated risk of that, it won't take much...things are not looking good".
> 
> 
> 
> 
> Third quarter will be flat to negative, then the government will step in to save the fourth quarter. Stimulus 2.0 is coming in September. Until then we are going to retest the lows.
Click to expand...


Well that is embarrassing...don't I feel like a freshman right now. 
Of course JP would put a bad spin on the 4th quarter...they must be salivating at the mere thought of another taxpayer windfall.


----------



## Zander

There will not be a second stimulus. It will never pass the House. Period. Obama knows it, but he will still propose one. Somewhere in the neighborhood of $1.6Trillion -  he just wants to get some mileage out of saying "republicans are holding back the economy".  Fortunately that tactic won't work. Americans are seeing through his cheap rhetoric and realizing that electing a dilettante with no experience was a bad idea. Once he is gone we should see a strong wave of optimism from the business community. Until then, we are going to muddle through.....


----------



## Rozman

Ravi said:


> IMO, the looming government spending cuts are contributing to world wide panic.



Yeh,crazy huh...trying to get  a Government to live within it's means just doesn't make sense to some people for some reason...SPEND,SPEND,SPEND,AND SPEND SOME MORE.


----------



## BoycottTheday

i havnt heard that excuse used yet anywhere else,

 did bloomberg insert their political opinion by chance?

Load of crap imho


----------



## Trajan

iamwhatiseem said:


> Toro said:
> 
> 
> 
> Oil touched below $80 and rallied. Europe is rallying off the lows this morning on what appears to be technical buying. This has caused a a retreat off the highs in precious metals.
> 
> 
> 
> 
> Pure anarchy is what it is.
> I run a business, so I don't have the time to track stocks day after day like this...I prefer to invest/cash out at opportunities only a couple times a year. With this kind of insane day to day falling and recovering - my dough is just sitting idle. Just get the freakin down adjustment over with so I can invest back in already
> I did almost 40% in 2009..about 10% in 2010...and it has been sitting out this whole year as I have been expecting this bubble to pop all year now.
> 
> [and here comes the post about how this evil conservative wants the economy to crash)
Click to expand...




Toro said:


> iamwhatiseem said:
> 
> 
> 
> 
> 
> Toro said:
> 
> 
> 
> Oil touched below $80 and rallied. Europe is rallying off the lows this morning on what appears to be technical buying. This has caused a a retreat off the highs in precious metals.
> 
> 
> 
> 
> Pure anarchy is what it is.
> I run a business, so I don't have the time to track stocks day after day like this...I prefer to invest/cash out at opportunities only a couple times a year. With this kind of insane day to day falling and recovering - my dough is just sitting idle. Just get the freakin down adjustment over with so I can invest back in already
> I did almost 40% in 2009..about 10% in 2010...and it has been sitting out this whole year as I have been expecting this bubble to pop all year now.
> 
> [and here comes the post about how this evil conservative wants the economy to crash)
> 
> Click to expand...
> 
> 
> I appreciate you sharing this. It is a common refrain from retail investors.
Click to expand...


my goal is simple, retirement value.
Iam and I discussed this at another venue 3 years ago, as I told him then I cashed almost completely out then (80%), and have been waiting,  my gold buy 20 months ago was a lark, the luckiest move I ever made, now, I am looking for co's that last have innate and intrinsic value,  in any market;  proctor and gamble, Johnson and Johnson, walmart, Pepsico,  I am buying to hold for the distance. with the limited years I have left, its my last major portfolio move.


----------



## Toro

I have made a list of high quality, high dividend paying companies too, i.e. PG.  But I'm going to wait a bit.  I want to buy them when they are stupid cheap.  They're just cheap now.  If you buy those companies and hold them for 20 years, they will generate returns of 10%-12% a year.  However, over the next 20 months, they could generate -40%.  Many high quality companies traded at 6x-7x earnings with 6%-8% dividend yields at the bottom in the 70s.  These types of valuations occur at generational bottoms.  We may get one of those over the next 5 years.


----------



## dilloduck

Toro said:


> I have made a list of high quality, high dividend paying companies too, i.e. PG.  But I'm going to wait a bit.  I want to buy them when they are stupid cheap.  They're just cheap now.  If you buy those companies and hold them for 20 years, they will generate returns of 10%-12% a year.  However, over the next 20 months, they could generate -40%.  Many high quality companies traded at 6x-7x earnings with 6%-8% dividend yields at the bottom in the 70s.  These types of valuations occur at generational bottoms.  We may get one of those over the next 5 years.



and I assume these tips are guaranteed ?


----------



## Ravi

Zander said:


> There will not be a second stimulus. It will never pass the House. Period. Obama knows it, but he will still propose one. Somewhere in the neighborhood of $1.6Trillion -  he just wants to get some mileage out of saying "republicans are holding back the economy".  Fortunately that tactic won't work. Americans are seeing through his cheap rhetoric and realizing that electing a dilettante with no experience was a bad idea. Once he is gone we should see a strong wave of optimism from the business community. Until then, we are going to muddle through.....



Republicans are holding back the economy. You don't cut spending when the economy is teetering on the brink.


----------



## Trajan

Toro said:


> I have made a list of high quality, high dividend paying companies too, i.e. PG.  But I'm going to wait a bit.  I want to buy them when they are stupid cheap.  They're just cheap now.  If you buy those companies and hold them for 20 years, they will generate returns of 10%-12% a year.  However, over the next 20 months, they could generate -40%.  Many high quality companies traded at 6x-7x earnings with 6%-8% dividend yields at the bottom in the 70s.  These types of valuations occur at generational bottoms.  We may get one of those over the next 5 years.



well we both know that there is no guarantee that they will get that low, I don't see JJ or PG dropping back another 10-15%....of course I could be wrong and I will have to make up that ground....I went to each of their sites, and downloaded their historical performance, I boxed out their performance vs. the last 2 downturns, I think they have another 5% tops, against that history to go, then wham its time. ( see attachment)

Also it appears to me,  now vs. a decade or 2 ago companies are a lot  more facile and quicker on the mark to get to net operating bottom+ leaner quicker= net profit,  they shed workers quicker, markets are more expansive/varied, supply chains more responsive.... 

edit- shit you cannot post excel here, anyway, as I said, I did my homework, I have a 13-17 year window, that will work.


----------



## Trajan

Ravi said:


> Zander said:
> 
> 
> 
> There will not be a second stimulus. It will never pass the House. Period. Obama knows it, but he will still propose one. Somewhere in the neighborhood of $1.6Trillion -  he just wants to get some mileage out of saying "republicans are holding back the economy".  Fortunately that tactic won't work. Americans are seeing through his cheap rhetoric and realizing that electing a dilettante with no experience was a bad idea. Once he is gone we should see a strong wave of optimism from the business community. Until then, we are going to muddle through.....
> 
> 
> 
> 
> Republicans are holding back the economy. You don't cut spending when the economy is teetering on the brink.
Click to expand...


I think we tried that...the spending thing. 

 now while I agree that killing all gov. spending is not the way to go, there does come a time when that spending adds net debt that outweighs the short term advantages gained,  MOST ESPECIALLY when it doesn't do what it is advertised to do, prime the pump to the economy putting it on  autopilot driving higher revenues to offset the spending........


----------



## BoycottTheday

Whats holding back the economy is the liberals war on capitalism.


----------



## Zander

Ravi said:


> Zander said:
> 
> 
> 
> There will not be a second stimulus. It will never pass the House. Period. Obama knows it, but he will still propose one. Somewhere in the neighborhood of $1.6Trillion -  he just wants to get some mileage out of saying "republicans are holding back the economy".  Fortunately that tactic won't work. Americans are seeing through his cheap rhetoric and realizing that electing a dilettante with no experience was a bad idea. Once he is gone we should see a strong wave of optimism from the business community. Until then, we are going to muddle through.....
> 
> 
> 
> 
> Republicans are holding back the economy. You don't cut spending when the economy is teetering on the brink.
Click to expand...

That bit of Keynesian wisdom is great if you are following a Keynesian economic plan: running surpluses in good times, and deficit spending in bad times. The problem is we have a huge national debt. We Americans don't run "surpluses" except in our caloric intake.  We spend, spend, spend and spend some more!!  So Keynes' bromides for economic recovery are ineffective. 

We have no other choice except to take our medicine and cut spending. Cut it drastically and deal with the pain all at once. Do that and in 1 year this economy will bounce back with a vengeance.


----------



## Paulie

Zander said:


> Ravi said:
> 
> 
> 
> 
> 
> Zander said:
> 
> 
> 
> There will not be a second stimulus. It will never pass the House. Period. Obama knows it, but he will still propose one. Somewhere in the neighborhood of $1.6Trillion -  he just wants to get some mileage out of saying "republicans are holding back the economy".  Fortunately that tactic won't work. Americans are seeing through his cheap rhetoric and realizing that electing a dilettante with no experience was a bad idea. Once he is gone we should see a strong wave of optimism from the business community. Until then, we are going to muddle through.....
> 
> 
> 
> 
> Republicans are holding back the economy. You don't cut spending when the economy is teetering on the brink.
> 
> Click to expand...
> 
> That bit of Keynesian wisdom is great if you are following a Keynesian economic plan: running surpluses in good times, and deficit spending in bad times. The problem is we have a huge national debt. We Americans don't run "surpluses" except in our caloric intake.  We spend, spend, spend and spend some more!!  So Keynes' bromides for economic recovery are ineffective.
> 
> We have no other choice except to take our medicine and cut spending. Cut it drastically and deal with the pain all at once. Do that and in 1 year this economy will bounce back with a vengeance.
Click to expand...


Nooooooope, the RICH will just swoop in and grab up all that was lost by those who were disadvantaged by the spending cuts.  Why do you hate non-rich people?


----------



## Zander

Paulie said:


> Zander said:
> 
> 
> 
> 
> 
> Ravi said:
> 
> 
> 
> Republicans are holding back the economy. You don't cut spending when the economy is teetering on the brink.
> 
> 
> 
> That bit of Keynesian wisdom is great if you are following a Keynesian economic plan: running surpluses in good times, and deficit spending in bad times. The problem is we have a huge national debt. We Americans don't run "surpluses" except in our caloric intake.  We spend, spend, spend and spend some more!!  So Keynes' bromides for economic recovery are ineffective.
> 
> We have no other choice except to take our medicine and cut spending. Cut it drastically and deal with the pain all at once. Do that and in 1 year this economy will bounce back with a vengeance.
> 
> Click to expand...
> 
> 
> Nooooooope, the RICH will just swoop in and grab up all that was lost by those who were disadvantaged by the spending cuts.  Why do you hate non-rich people?
Click to expand...


Because they are stupid?


----------



## william the wie

Disagree with you on timing Zander with the moronic rewriting of bankruptcy laws by congress over the past 30 years what you are saying is no longer possible. Under the current federal bankruptcy code de facto peonage has been created. Except for automatic inheritance of debt our current laws are examples of created debt slavery to prevent deleveraging. You and I may not owe our souls to the company store but DC sure does.


----------



## KissMy

Trajan said:


> Toro said:
> 
> 
> 
> I have made a list of high quality, high dividend paying companies too, i.e. PG.  But I'm going to wait a bit.  I want to buy them when they are stupid cheap.  They're just cheap now.  If you buy those companies and hold them for 20 years, they will generate returns of 10%-12% a year.  However, over the next 20 months, they could generate -40%.  Many high quality companies traded at 6x-7x earnings with 6%-8% dividend yields at the bottom in the 70s.  These types of valuations occur at generational bottoms.  We may get one of those over the next 5 years.
> 
> 
> 
> 
> well we both know that there is no guarantee that they will get that low, I don't see JJ or PG dropping back another 10-15%....of course I could be wrong and I will have to make up that ground....I went to each of their sites, and downloaded their historical performance, I boxed out their performance vs. the last 2 downturns, I think they have another 5% tops, against that history to go, then wham its time. ( see attachment)
> 
> Also it appears to me,  now vs. a decade or 2 ago companies are a lot  more facile and quicker on the mark to get to net operating bottom+ leaner quicker= net profit,  they shed workers quicker, markets are more expansive/varied, supply chains more responsive....
> 
> edit- shit you cannot post excel here, anyway, as I said, I did my homework, I have a 13-17 year window, that will work.
Click to expand...


Last year when the news of P&G pampers diapers chemical burning babies came out, P&G hit $39 during the flash crash. If you want cheap stocks you should set your buy limits now & wait for the market to come to you. We are in the age of high speed computer trading so you must always have your buy & sell limit trades on.


----------



## Mr.Nick

Ravi said:


> Zander said:
> 
> 
> 
> There will not be a second stimulus. It will never pass the House. Period. Obama knows it, but he will still propose one. Somewhere in the neighborhood of $1.6Trillion -  he just wants to get some mileage out of saying "republicans are holding back the economy".  Fortunately that tactic won't work. Americans are seeing through his cheap rhetoric and realizing that electing a dilettante with no experience was a bad idea. Once he is gone we should see a strong wave of optimism from the business community. Until then, we are going to muddle through.....
> 
> 
> 
> 
> Republicans are holding back the economy. You don't cut spending when the economy is teetering on the brink.
Click to expand...


And in what universe is the government the backbone of the economy?

More like you don't tax the backbone of the economy - private sector workers and businesses..

Government spending retarded this economy because the real backbone of this economy knows who will have to pay for all that spending and it wont be those who are receiving the redistributed wealth that came from their pockets.

Not to mention all the government has done is bailout unions with all that spending.


----------



## Mr.Nick

william the wie said:


> Disagree with you on timing Zander with the moronic rewriting of bankruptcy laws by congress over the past 30 years what you are saying is no longer possible. Under the current federal bankruptcy code de facto peonage has been created. Except for automatic inheritance of debt our current laws are examples of created debt slavery to prevent deleveraging. You and I may not owe our souls to the company store but DC sure does.



Those who declare bankruptcy commit thievery...

In what universe is it ok to rack up 50k in debt and walk away from it for 10?

That's 40k in goods and services someone/entity had to pay for. Someone is getting fucked and its not the person declaring bankruptcy.

It was that accumulated debt + sub prime loans that created the economic collapse er bankrupted the banks in the first place.


----------



## Trajan

so here it is...to sum up;

JPMorgan Chase ( James Dimon, Obama sppter and adherent of here to fore bullish GDP figures ) has now cleared the decks...


Growth in the current quarter looks only moderately softer than our previous projection, however the risks to our previous projection for 2.5% growth in Q4 are now very clearly to the downside and we are lowering forecasted growth in that quarter to 1.0%. We are also lowering 12Q1 growth to 0.5% from 1.5%.%. In sum, over the next four quarters we don't see growth that is much faster than the growth that took place in the first half of this year.


now the next shoe...

Jackson Hole meeting;


Goldman Sachs turn, ( the here to fore bearish crew)

Zach Pandl: "In light of the downshift in the data this week, we are cutting our second-half growth forecasts further. We now expect GDP growth of 1.0% in Q3 and 1.5% in Q4, both down from 2.0% previously. These changes reduce our forecasts for full-year 2011 GDP growth to 1.5% from 1.7%. Exhibit 1 shows the details."

well, lets plsit the next 2 quarters difference, and even give it a .25% boost to avoid being accused of trashing the admin. etc.

so, 1.25%....really? seriously?

My wife works for a well known fortune 500 co. Her ceo has called a all hands update in 2 weeks ( they don't do these often and in the last 3 years none of them were good news), which has led to the here to fore rumors of another round of layoffs having been proved true. They have had 2 layoffs in the last 2.5 years, 8-10% each time..the timing is always the same; announce it and time it for November/December end of year close. They won't be alone industry wise, here we go again.


----------



## BoycottTheday

Tell ya what, if you calculated inflation like they did in 1978

That would tell ya more than you need to know.

And it wouldnt be pretty.


----------



## Toro

The market is trying to bottom here, though closing at the lows of the day isn't a good way to do it.

Futures are up on speculation of Friday's Bernanke's Jackson Hole speech.  Last year, Bernanke telegraphed QE2, igniting a powerful 6 month rally.  The market thinks that Bernanke will be market-friendly again this year.

Stocks, Commodities Gain on Fed Speculation - Bloomberg


----------



## BoycottTheday

Giving the banks cheap money to invest in the stock market does me good how?


----------



## BoycottTheday

i guess thats not the type of question Toro likes to answer.

I will, it wont, it dint before.

 How much did the fed give the royal bank of scotland again Toro?

Criminals, the lot of them, when we follow the money, jail should be what follow's that.


----------



## Toro

BoycottTheday said:


> i guess thats not the type of question Toro likes to answer.
> 
> I will, it wont, it dint before.
> 
> How much did the fed give the royal bank of scotland again Toro?
> 
> Criminals, the lot of them, when we follow the money, jail should be what follow's that.


----------



## BoycottTheday

Welcome to ignore Toro.


----------



## BoycottTheday

Much better, i wont waste one second of my time here with propagandists. Just a FYI.


----------



## Ravi




----------



## Toro

BoycottTheday said:


> Much better, i wont waste one second of my time here with propagandists. Just a FYI.



I have no idea what you are talking about.


----------



## BoycottTheday

Your on it now to Ravi ,

 why should i even bother giving idiots the privilege of posting their opinion on my screen?

I dont, do i. welcome to ignore.


----------



## Toro

Oh I get it. BoycottTheDay is Anachronism and his strange Ignore List. 

Anyways, back to topic. The market had a good day yesterday and is trying to put in a bottom.


----------



## editec

Toro posts an explanation for why he thinks the market might rally and ya'll _blame_ him for it?


Christ! Give the man a break!


----------



## Full-Auto

BoycottTheday said:


> Your on it now to Ravi ,
> 
> why should i even bother giving idiots the privilege of posting their opinion on my screen?
> 
> I dont, do i. welcome to ignore.



You mean to tell us you wish to give up a comedy rich environment? You want to miss the one in a thousand chance of them making a good point?

Not all ideas are bankrupt from a group you generally disagree with.


----------



## Toro

Oil looks interesting here. 

FTR if we do get a rally, it would probably be best if we back and filled for the next few months, consolidating rather than going straight up. 

Sentiment is extremely negative and the market is very oversold.


----------



## william the wie

Toro said:


> Oil looks interesting here.
> 
> FTR if we do get a rally, it would probably be best if we back and filled for the next few months, consolidating rather than going straight up.
> 
> Sentiment is extremely negative and the market is very oversold.


Without at least some back and fill today which has not happened yet I would say we are in a bull trap that will last a month at most. Turnaround Tuesdays that do not turnaround vs. trend are generally bad news. Not an invariant indicator a Tuesday that goes opposite to Monday's reaction to the weekend news is generally an indicator of more solid news assessment.


----------



## JWBooth

[ame="http://www.youtube.com/watch?v=q1ZV4Mx7tw8"]Steely Dan - "Black Friday" - YouTube[/ame]

Opens down this morning...again


----------



## Toro

We are at a point of indecision in the market. However, I am beginning to think that there is a possibility the next move is to the upside.


----------



## JWBooth

So much for the Black Friday thing.....


----------



## Toro

At 6.30pm on Monday, Dow futures are down 233.


----------



## william the wie

Toro said:


> At 6.30pm on Monday, Dow futures are down 233.


That's quite possibly the good news. Asia and the EU are taking guidance from the US and there is another session of panic in store for each area. Given exchange rate changes my SWAG is that a morning sell off tomorrow will be followed by an afternoon rise that might go parabolic by week's end. No Guarantees! 

However it looks like a crisis of confidence is building in the Euro banking system and the currency pegs in the Far East are breaking. That is not good.


----------



## Toro

At 8pm, Dow futures are down 266 points.


----------



## saveliberty

I went back to cash after three weeks in the market.  Made 5.5%.  I'm happy.  Not sure what to make of the moment.  I sits and I waits.


----------



## Rocko

I think we're tremendously oversold....The market should have soared on the EPA deregulation  news..September is usually a bad month, but we know interest rates are going to remain low, corporate earnings are solid, and if all else fails Bernanke won't hesitate with QE3...

Oil makes mucho sense, because as fear dissipates demand will naturally come back, and the market is ignoring a historically strong positive correlation between gold and oil.

Tech is also very interesting, because of the enormous down turn..I think we are going to see a lot of consolidation, particularly in cloud computing..

But who knows


----------



## saveliberty

We cartainly are not oversold.  We should be at 9800 on the Dow.  Lower if we can't cut more spending and reduce the deficit.


----------



## Rocko

saveliberty said:


> We cartainly are not oversold.  We should be at 9800 on the Dow.  Lower if we can't cut more spending and reduce the deficit.



Certainly is the cardinal sin, when talking the stock market....cutting spending is be the right thing to do, as far as our countries general health, but the stock market doesn't ignore crony capitalism....Reducing the debt is a good thing, but how to do it is tricky...

For the record i'm a supply side guy, and maybe i'm irrationally bullish, but no one knows..I mean we're talking about the stock market.

of course I agree we should cut spending, and slash the debt.


----------



## Toro

We are oversold.

Or at least we were.

The oversold readings a few weeks ago were even higher than during the worst periods of the Financial Crisis.

Technically, things still look weak.


----------



## Zander

If you look at the DOW in terms of "real money", we have been in a bear market since 2000. 









I see this market heading much lower.


----------



## saveliberty

Toro said:


> We are oversold.
> 
> Or at least we were.
> 
> The oversold readings a few weeks ago were even higher than during the worst periods of the Financial Crisis.
> 
> Technically, things still look weak.



I agree we were oversold back on August 5th.  That is when I bought in.  As of August 21st, I have been out.  I will consider us oversold at 10400 this month and 9800 in Ocotober.  My next two buy in timeframes.


----------



## jonbonraki

Just wanted to know how printing the money triggers inflation!!!!!


----------



## Toro

Stocks are almost uninvestable at the moment. I'm sitting almost entirely in cash.


----------



## saveliberty

Agreed.  Waiting til 9800 then buying dividend yields.  Should be minimal price erosion with big yields.


----------



## Trajan

Toro said:


> Stocks are almost uninvestable at the moment. I'm sitting almost entirely in cash.



its a mess.


----------



## william the wie

Well Obama's speech bombed and the Greek debt crisis is likely to go meltdown soon.


----------



## Toro

I don't think the market was expecting anything from Obama. They were of Bernanke. The market began selling off within a minute of the release of his speech on Thursday. The S&P500 is down 50 points since then.  But the problems today were because of Europe.


----------



## Trajan

Toro said:


> I don't think the market was expecting anything from Obama. They were of Bernanke. The market began selling off within a minute of the release of his speech on Thursday. The S&P500 is down 50 points since then.  But the problems today were because of Europe.



and our exposure to Europe

remember Tarp II.....live it, love it.


----------



## Zander

Obama speaks, the market weeps.....


----------



## saveliberty

Greeks will not accept an austerity plan period.  Until the EU drops them and fixes what they can, this will be a serious problem.  I love watching socialism meeting its logical conclusion.


----------



## Toro

Trajan said:


> Toro said:
> 
> 
> 
> I don't think the market was expecting anything from Obama. They were of Bernanke. The market began selling off within a minute of the release of his speech on Thursday. The S&P500 is down 50 points since then.  But the problems today were because of Europe.
> 
> 
> 
> 
> and our exposure to Europe
> 
> remember Tarp II.....live it, love it.
Click to expand...


A lot of this is because the market perceives the Europeans as dragging their feet.  If there was a EuroTARP, the market would probably soar.  But that's not going to happen, at least not with some pain first.

Parts of the market are coming into support, where one might expect a bounce.  However, other parts are breaking down.  Take a look at a chart of JPM or GS.  Those stocks look like they are going lower to me.  It's hard to believe that the market can go up appreciably if the financials are breaking down.  

I've been dinking and dunking with some small trades over the last few weeks that have mostly been successful, but I trade to catch a bounce around 2pm Friday.  That failed and I closed it at the end of the day.  Now I'm wondering if I should go short as these financials break down.


----------



## FactFinder

Toro said:


> The other thread has turned into the usual mindless political hack garbage. This thread is to discuss the stock market crash without blaming everything on Republicans or Democrats by people who barely know the difference between a stock and livestock.
> 
> The UK has fallen 12% in 5 days. Switzerland has fallen 17% in 2 weeks.



The Serious Stock Market Crash Thread 

Are you serious? Individuals cannot be serious when their best efforts are thwarted by automation trading. The market currently is in a spin. The hedge funds are just trying to scrape off highs in order to pay their obligations to retirement funds. That is why so many look the other way at the energy gouging. The whole game is just shooting yourself in the foot.  As long as you gouge energy, the economy remains oppressed.


----------



## saveliberty

Germany looks to be pulling out of the Greece bailout.  Black Monday is here.


----------



## saveliberty

Moody's is suppose to downgrade French banks today as well.


----------



## saveliberty

So happy to have that all wrong today.  Hope I wadn't just a day early.


----------



## saveliberty

Interesting to see where support will be today.  10,600?


----------



## Toro

10600 on the Dow. 1120 on the SP. I'm playing a bounce but it's just a trade.


----------



## saveliberty

Same here.


----------



## editec

saveliberty said:


> So happy to have that all wrong today. Hope I wadn't just a day early.


 
Better to be right too soon that right too late, amigo.


----------



## Liberty

put spread anyone?


----------



## william the wie

saveliberty said:


> Interesting to see where support will be today.  10,600?


 Well thinking a bit longer term I figure that we are headed for a market where average dividend yield exceeds the 10 year AAA corporate average bond yield by 50%. I haven't checked where that is but I am fairly sure we have a ways to go.


----------



## saveliberty

Just get me back to 11,000 in the next couple of days and I'm happy.


----------



## iamwhatiseem

I have a boatload of money waiting on below 10,000...can't believe it hasn't happened yet. The freaking bulls have been fighting tooth and nail to hold onto this bubble...been waiting for over a year now.


----------



## Trajan

I had a feeling this thread would get a work out today.


come on 500....come to papa....500 babbbby!!!!


----------



## iamwhatiseem

Trajan said:


> I had a feeling this thread would get a work out today.
> 
> 
> come on 500....come to papa....500 babbbby!!!!



500 today, 500 tomorrow. If the f*cking bulls will get the hell out of the way and let the market adjust - we can all make a killing again.


----------



## Trajan

tell bernbanke to give another speech, that'll do it...


----------



## iamwhatiseem

Trajan said:


> tell bernbanke to give another speech, that'll do it...



Damn straight...pair him up with Geithner...and then send out Obama to do a press conference and we can get this going good.


----------



## KissMy

The Plunge Protection Team will make sure the Dow closes above August 10th close $10,719


----------



## Jos

*Global Financial Meltdown: Investors Dump Nearly Everything Amidst Worldwide Market Crash*


> Major Stock Market Indexes, Commodities, Currencies And Everything In Between Is Being Dumped By Investors Across The Globe In The Midst Of A Global Financial Meltdown.
> 
> The financial markets across the globe are facing one of the most massive sell-offs in recent memory.
> 
> The Dow Jones Industrial average has sold off over 467 points today. When and when you add that on top of 284 point drop following yesterdays crash FEDs statement, which announced operation twist and warned of significant downside risk and strains in global financial markets,  we have a 751 point drop in the DOW since 2:45 PM est yesterday, which is the largest 2 day slump since 2008.
> 
> There are an endless parade of economic statistics many of which are the worse since the Great Depression and World War 2 era. We have also seen 111 of the s&P 500 hit fresh 52 week lows, a drop in global currencies  beside the dollar, oil dropping into the high $70 per barrel range and gold plummeting  over 5% to trade in the low $1,700 per ounce range.


Global Financial Meltdown: Investors Dump Nearly Everything Admist Worldwide Market Crash

1981 Movie Rollover Predicts Today&#39;s News - YouTube


----------



## iamwhatiseem

KissMy said:


> The Plunge Protection Team will make sure the Dow closes above August 10th close $10,719



Got that right.
Economic news over the past 8-10 weeks has been flat out horrible..nothing...not one thing keeping this ridiculous bubble inflated beyond short term traders.


----------



## Toro

Today was a Risk Off day. 

In case anybody was wondering...


----------



## Valerie

Toro said:


> Today was a Risk Off day.
> 
> In case anybody was wondering...







Yowza!  What a day!  If anybody has any cash left.....BUY BUY BUY!  lol


----------



## Toro

I was buying, as a trade. Stops are set below. 

If one wants to be positive, the S&P close only a few points lower than where it opened. Indices are around support and the VIX is at resistance. Volume was high, but not as high as in August. The last billion shares in the last hour took the market up.  Sentiment is extremely bearish based on II numbers, as well as other quantitative statistics. There are positive divergences in the oscillators. 

OTOH the fundamental news has been poor, though a proprietary index I look at said the US economy is expanding at the fastest rate since Spring (but that might change).  The loonie had it's 2nd worst day in at least 40 years. Secondary indices and a few foreign ones are breaking down.


----------



## Toro

Volatility has been huge. Realized annualized volatility of the S&P 500 has been 43% since Aug 4, and 64% for the Russell 2000, three times the long term average.


----------



## Mr Liberty

Toro said:


> I was buying, as a trade. Stops are set below.
> 
> If one wants to be positive, the S&P close only a few points lower than where it opened. Indices are around support and the VIX is at resistance. Volume was high, but not as high as in August. The last billion shares in the last hour took the market up.  Sentiment is extremely bearish based on II numbers, as well as other quantitative statistics. There are positive divergences in the oscillators.
> 
> OTOH the fundamental news has been poor, though a proprietary index I look at said the US economy is expanding at the fastest rate since Spring (but that might change).  The loonie had it's 2nd worst day in at least 40 years. Secondary indices and a few foreign ones are breaking down.



Set those stops close Toro.  I think this market is headed south and will continue in a downtrend until Uncle Ben announces QE 3.


----------



## KissMy

Government Shutdown deadline coming in 1 week. When congress caves in & kicks the can down the road again we will get a huge bounce.


----------



## Valerie

Toro said:


> I was buying, as a trade. Stops are set below.
> 
> If one wants to be positive, the S&P close only a few points lower than where it opened. Indices are around support and the VIX is at resistance. Volume was high, but not as high as in August. The last billion shares in the last hour took the market up.  Sentiment is extremely bearish based on II numbers, as well as other quantitative statistics. There are positive divergences in the oscillators.
> 
> OTOH the fundamental news has been poor, though a proprietary index I look at said the US economy is expanding at the fastest rate since Spring (but that might change).  The loonie had it's 2nd worst day in at least 40 years. Secondary indices and a few foreign ones are breaking down.







I was a buyer today as well...  It's nerve wracking!


----------



## Zander

In my humble opinion, those of you counting on QE3 for a market bounce are in for a huge disappointment. I believe that it's already priced in the market.  If the Fed doesn't start another round of quantitative easing, the market has only one way to go - down.  If they do announce another round of QE I believe it will still drop,  but not as much. 

The reality is that we are in a bear market for stock prices and have been for quite some time.  Interestingly, Gold prices have also dropped along with equities. Feels like deflation to me.....


----------



## iamwhatiseem

You know...there might be 100 people in America that could predict what happens tomorrow.
I think, as the past 8 weeks has shown us, that there is an equal chance that the DOW will drop 300 points tomorrow - or raise 300 points.


----------



## KissMy

Zander said:


> In my humble opinion, those of you counting on QE3 for a market bounce are in for a huge disappointment. I believe that it's already priced in the market.  If the Fed doesn't start another round of quantitative easing, the market has only one way to go - down.  If they do announce another round of QE I believe it will still drop,  but not as much.
> 
> The reality is that we are in a bear market for stock prices and have been for quite some time.  Interestingly, Gold prices have also dropped along with equities. Feels like deflation to me.....



It is strong dollar deflation. You are correct about the bear market. Unless the government barrows & prints more to stop the strong dollar deflation we will decline. If the government barrows & prints more we will bounce for a few days until another ratings agency downgrades us for making the debt even larger, at which time we will drop again. There is money to be made if you can time the roller coaster ride correctly.


----------



## Cuyo

iamwhatiseem said:


> You know...there might be 100 people in America that could predict what happens tomorrow.
> I think, as the past 8 weeks has shown us, that there is an equal chance that the DOW will drop 300 points tomorrow - or raise 300 points.



I read somewhere that a study confirmed that throwing darts at the stock page to pick winners was consistently more accurate than the most qualified analysts.


----------



## Valerie

The US Dollar is actually on the rise!







> *Gold, Acting Like A Commodity, Plummets In The Face Of A Rising Dollar
> *
> 
> Global markets have broken down after Bernanke said the economy faces significant downside risks.  Interestingly, gold plummeted along with other risk assets, despite its traditional safe-haven status, which generally benefits from bouts of fear and volatility.  *The underlying reason? A rallying U.S. dollar.
> *
> Gold, Acting Like A Commodity, Plummets In The Face Of A Rising Dollar - Forbes


----------



## Toro

Valerie said:


> The US Dollar is actually on the rise!
> 
> 
> 
> 
> 
> 
> 
> 
> *Gold, Acting Like A Commodity, Plummets In The Face Of A Rising Dollar
> *
> 
> Global markets have broken down after Bernanke said the economy faces significant downside risks.  Interestingly, gold plummeted along with other risk assets, despite its traditional safe-haven status, which generally benefits from bouts of fear and volatility.  *The underlying reason? A rallying U.S. dollar.
> *
> Gold, Acting Like A Commodity, Plummets In The Face Of A Rising Dollar - Forbes
Click to expand...


The world goes to cash when it gets frightened.  Gold is just another risk commodity when there is a liquidity crisis.  It gets sold to meet cash calls.


----------



## Toro

Zander said:


> In my humble opinion, those of you counting on QE3 for a market bounce are in for a huge disappointment. I believe that it's already priced in the market.  If the Fed doesn't start another round of quantitative easing, the market has only one way to go - down.  If they do announce another round of QE I believe it will still drop,  but not as much.
> 
> The reality is that we are in a bear market for stock prices and have been for quite some time.  Interestingly, Gold prices have also dropped along with equities. Feels like deflation to me.....



Props BTW for sticking to your guns.


----------



## KissMy

The velocity of money is slowing even as the money supply is soaring. There is just nothing in this country worth investing all that money into.


----------



## uscitizen

I was just chekin and some of my proof eagles are selling for around 3,000 !


----------



## zonly1

Valerie said:


> The US Dollar is actually on the rise!
> 
> 
> 
> 
> 
> 
> 
> 
> *Gold, Acting Like A Commodity, Plummets In The Face Of A Rising Dollar
> *
> 
> Global markets have broken down after Bernanke said the economy faces significant downside risks.  Interestingly, gold plummeted along with other risk assets, despite its traditional safe-haven status, which generally benefits from bouts of fear and volatility.  *The underlying reason? A rallying U.S. dollar.
> *
> Gold, Acting Like A Commodity, Plummets In The Face Of A Rising Dollar - Forbes
Click to expand...

Dollar up and gas down..let's hope it may continue.  Obama's do dumb to realize the significance.


----------



## iamwhatiseem

uscitizen said:


> I was just chekin and some of my proof eagles are selling for around 3,000 !



If I had Gold I would have already sold it by now.
I have a colleague who is one of those guys...plays stupid lottery scratch-offs and wins $50 like every week or something...goes to Vegas and comes back $3000 ahead - just a guy that always lands on top.
Anyhow...he put $25,000 in gold back in the early 2000's...he sold it all early last month.


----------



## editec

iamwhatiseem said:


> I have a boatload of money waiting on below 10,000...can't believe it hasn't happened yet. The freaking bulls have been fighting tooth and nail to hold onto this bubble...been waiting for over a year now.


 
_"Markets can remain irrational longer than you can remain solvent "_

_John Kenneth Galbraith_


----------



## editec

Hey look at _that!_

A flock of _cygnus atratus!_

http://www.fooledbyrandomness.com/ARTE.pdf

READ IT!

Clearly some of you already have, or perhaps some of you autodidacts already intuited that we are living in an age of _cygnus atratus._

Still I greatly admire those of you with the stones to play the market.

WEre I in a position to play, I would not know whether to shit or go blind, right now.

Good luck boys and girls, I hope ya'll make a killing.

But if you do, and you are NOT humble about it?

Then sooner or later that black swan is going to shit all over you.


----------



## iamwhatiseem

editec said:


> Hey look at _that!_
> 
> A flock of _cygnus atratus!_
> 
> http://www.fooledbyrandomness.com/ARTE.pdf
> 
> READ IT!
> 
> Clearly some of you already have, or perhaps some of you autodidacts already intuited that we are living in an age of _cygnus atratus._
> 
> Still I greatly admire those of you with the stones to play the market.
> 
> WEre I in a position to play, I would not know whether to shit or go blind, right now.
> 
> Good luck boys and girls, I hope ya'll make a killing.
> 
> But if you do, and you are NOT humble about it?
> 
> Then sooner or later that black swan is going to shit all over you.



That is the problem. The markets used to be a dependable place to put your money to not only protect it from inflation, but make a sizable nest egg over the course of several decades.
Not anymore.
Now you have a flock of wasp and sharks.... people desiring to make a decade worth of investment interest -  overnight. Today conventional investors are completely outnumbered by these frenzy traders. The result is a market that has no bearing on reality.


----------



## Toro

I've changed my mind. I sold my positions at a loss (like much of my trading this year).  

I still expect a bounce but am not interested in playing it. I will look to short any bounces. 

I am officially freaked out, and plan on going home and drinking.


----------



## Valerie

Toro said:


> I've changed my mind. I sold my positions at a loss (like much of my trading this year).
> 
> I still expect a bounce but am not interested in playing it. I will look to short any bounces.
> 
> I am officially freaked out, and plan on going home and drinking.






  I bailed too!  Cheers!





Please make a showing at EZ's party later!  We need some studs!  

http://www.usmessageboard.com/echo-zulus-rep-fest-zone/186371-the-wedding-shower.html#post4180508


----------



## Wiseacre

Valerie said:


> Toro said:
> 
> 
> 
> I've changed my mind. I sold my positions at a loss (like much of my trading this year).
> 
> I still expect a bounce but am not interested in playing it. I will look to short any bounces.
> 
> I am officially freaked out, and plan on going home and drinking.
> 
> 
> 
> 
> 
> 
> 
> I bailed too!  Cheers!
> 
> 
> 
> 
> 
> Please make a showing at EZ's party later!  We need some studs!
> 
> http://www.usmessageboard.com/echo-zulus-rep-fest-zone/186371-the-wedding-shower.html#post4180508
Click to expand...




Me 3, I couldn't take it any more.   I shall lift a cold one to both of you in hopes of better days.


----------



## Jos

Paper Gold and silver positions were sold, the bigger the drop the better the bounce, jos who is buying, buying,and buying (physical)


----------



## Zander

Gold dropped to 1653 today....deflation has the effect....


----------



## JWBooth

Zander said:


> Gold dropped to 1653 today....deflation has the effect....




We can only hope this continues...


----------



## Toro

Zander said:


> Gold dropped to 1653 today....deflation has the effect....



The forces in the economy are deflationary.  The responses are inflationary.  The responses are now handcuffed as the Fed is impotent and DC incapable.  We may be living 1937 all over again.

Deflation in this country has basically run its course.  It has not elsewhere, however.

As for gold, I respect the collapse COMPLETELY.  But we've had three other similar downward moves of 9% or more over two days like we've had this week since this bull market began a decade ago.  It MAY be the end of the gold bull market but it does not have the typical metrics one would normally associate with the end of a bull market.

In the meantime, I am very worried, and am sitting almost entirely in cash.  The small amount of stocks I own are hedged.  I expect a bounce then new lows.  If we don't bounce, look out.


----------



## saveliberty

I went to silver and gold EFTs in my CNBC challenge today.


----------



## uscitizen

iamwhatiseem said:


> uscitizen said:
> 
> 
> 
> I was just chekin and some of my proof eagles are selling for around 3,000 !
> 
> 
> 
> 
> If I had Gold I would have already sold it by now.
> I have a colleague who is one of those guys...plays stupid lottery scratch-offs and wins $50 like every week or something...goes to Vegas and comes back $3000 ahead - just a guy that always lands on top.
> Anyhow...he put $25,000 in gold back in the early 2000's...he sold it all early last month.
Click to expand...


I put close to 200k in eagles at around 550 each a few years before the crash.  I forget when exactly would have to check.  I bought from a private individual.

then shortly before the crach I liquidated my stocks for a nice profit and bought more eagles.
I forget around 200k more.
Seems like I paid more like 650-700 for them that time.


----------



## iamwhatiseem

Toro said:


> Zander said:
> 
> 
> 
> Gold dropped to 1653 today....deflation has the effect....
> 
> 
> 
> 
> The forces in the economy are deflationary.  The responses are inflationary.  The responses are now handcuffed as the Fed is impotent and DC incapable.  We may be living 1937 all over again.
> 
> Deflation in this country has basically run its course.  It has not elsewhere, however.
> 
> As for gold, I respect the collapse COMPLETELY.  But we've had three other similar downward moves of 9% or more over two days like we've had this week since this bull market began a decade ago.  It MAY be the end of the gold bull market but it does not have the typical metrics one would normally associate with the end of a bull market.
> 
> In the meantime, I am very worried, and am sitting almost entirely in cash.  The small amount of stocks I own are hedged.  I expect a bounce then new lows.  If we don't bounce, look out.
Click to expand...


It is past time that Wall Street reflects reality. Which is normal. 
I want the market to go below 10000...then I am all in.


----------



## Zander

Toro said:


> Zander said:
> 
> 
> 
> Gold dropped to 1653 today....deflation has the effect....
> 
> 
> 
> 
> The forces in the economy are deflationary.  The responses are inflationary.  The responses are now handcuffed as the Fed is impotent and DC incapable.  We may be living 1937 all over again.
> 
> Deflation in this country has basically run its course.  It has not elsewhere, however.
> 
> As for gold, I respect the collapse COMPLETELY.  But we've had three other similar downward moves of 9% or more over two days like we've had this week since this bull market began a decade ago.  It MAY be the end of the gold bull market but it does not have the typical metrics one would normally associate with the end of a bull market.
> 
> In the meantime, I am very worried, and am sitting almost entirely in cash.  The small amount of stocks I own are hedged.  I expect a bounce then new lows.  If we don't bounce, look out.
Click to expand...


I mostly agree with you (*except that I don't think deflation has run it's course) and I too am entirely in cash and short term treasuries. I expect stocks to trend lower, much much lower than anyone can imagine. 

Here's what I find odd - Gold & silver are supposed to be safe havens, right?  Why, then - after the hard fall in stocks - are gold and silver also falling? Gold just had its worst day in 5 years, and silver fell 18% -- its 2nd largest daily point decline in modern history.   Can you say bubble? Gold has risen at 4x the rate of the CPI and would need to fall to $500 an ounce to reflect the rise in consumer prices.  

Will Gold & silver (and stocks) continue to head straight down?  I doubt it, the market is much more clever than that!  After sharp drops the market rises slowly, sucking investors in, purring like an innocent kitten......"the water is fine, nice and calm....no sharks here".  After enough time goes by people get enticed by the fun and wade back in the waters.........then WHAM!!!! A rogue wave hits and a shark attacks.  This scenario is likely to play out several times before the bear market bottoms. 

PS-  A few weeks ago there was 98% bullish sentiment at trade-futures.com and the president of the World Bank opined that governments should reconsider the role of GOLD in their monetary systems.  If that isn't a bearish indicator I don't know what is! 

PPS- the hyper-inflationists are wrong. The U.S. dollar cannot be devalued because its not linked, backed or convertible into anything which would allow it to be devalued.  Such was not the case back in the 1930s, when Roosevelt devalued the dollar by raising the price of gold from $20.67 to $35.00. But back in 1934, one could, by law, convert their dollars into a set amount of gold. No such linkage exists today, making devaluation impossible.  Of course you could argue, as the hyper-inflationists do, that the Fed and the U.S. government will monetize all debt (IMHO it is highly unlikely that they would ever do this) , which would thereby drive down the value of the dollar. But these actions are different and separate from the strict meaning of devaluation.


----------



## william the wie

Zander, I disagree with some of your diagnosis on these points:

Greece alone will be a bigger default than Argentina and Russia were combined and both of those were connected to/caused major downturns. If contagion hits the PIIGS with a Greek Default a Dow 100 is quite possible.

It is quite possible because in a liquidity crisis what is sold is what can still be sold as with gold and silver currently.

The biggest default(s) in history are expected to hit in 2012 so the smart money is headed for the exits now. 

What I find bizarre is that some of the posters on this thread predicted this result but did not prepare for it and many who said it wouldn't happen are now stating that they did position themselves to profit or at least limited their damage.


----------



## Toro

Zander said:


> Toro said:
> 
> 
> 
> 
> 
> Zander said:
> 
> 
> 
> Gold dropped to 1653 today....deflation has the effect....
> 
> 
> 
> 
> The forces in the economy are deflationary.  The responses are inflationary.  The responses are now handcuffed as the Fed is impotent and DC incapable.  We may be living 1937 all over again.
> 
> Deflation in this country has basically run its course.  It has not elsewhere, however.
> 
> As for gold, I respect the collapse COMPLETELY.  But we've had three other similar downward moves of 9% or more over two days like we've had this week since this bull market began a decade ago.  It MAY be the end of the gold bull market but it does not have the typical metrics one would normally associate with the end of a bull market.
> 
> In the meantime, I am very worried, and am sitting almost entirely in cash.  The small amount of stocks I own are hedged.  I expect a bounce then new lows.  If we don't bounce, look out.
> 
> Click to expand...
> 
> 
> I mostly agree with you (*except that I don't think deflation has run it's course) and I too am entirely in cash and short term treasuries. I expect stocks to trend lower, much much lower than anyone can imagine.
> 
> Here's what I find odd - Gold & silver are supposed to be safe havens, right?  Why, then - after the hard fall in stocks - are gold and silver also falling? Gold just had its worst day in 5 years, and silver fell 18% -- its 2nd largest daily point decline in modern history.   Can you say bubble? Gold has risen at 4x the rate of the CPI and would need to fall to $500 an ounce to reflect the rise in consumer prices.
> 
> Will Gold & silver (and stocks) continue to head straight down?  I doubt it, the market is much more clever than that!  After sharp drops the market rises slowly, sucking investors in, purring like an innocent kitten......"the water is fine, nice and calm....no sharks here".  After enough time goes by people get enticed by the fun and wade back in the waters.........then WHAM!!!! A rogue wave hits and a shark attacks.  This scenario is likely to play out several times before the bear market bottoms.
> 
> PS-  A few weeks ago there was 98% bullish sentiment at trade-futures.com and the president of the World Bank opined that governments should reconsider the role of GOLD in their monetary systems.  If that isn't a bearish indicator I don't know what is!
> 
> PPS- the hyper-inflationists are wrong. The U.S. dollar cannot be devalued because its not linked, backed or convertible into anything which would allow it to be devalued.  Such was not the case back in the 1930s, when Roosevelt devalued the dollar by raising the price of gold from $20.67 to $35.00. But back in 1934, one could, by law, convert their dollars into a set amount of gold. No such linkage exists today, making devaluation impossible.  Of course you could argue, as the hyper-inflationists do, that the Fed and the U.S. government will monetize all debt (IMHO it is highly unlikely that they would ever do this) , which would thereby drive down the value of the dollar. But these actions are different and separate from the strict meaning of devaluation.
Click to expand...


I don't view gold as a safe haven.  I view it as a repository of value against the devaluation of fiat currencies.  The long-term trade on gold is a bet that governments will continue to pursue policies that debase fiat currencies.  When governments get serious about maintaining the value of their currencies, you won't want to be anywhere near gold.

I don't like gold as a fear trade.  Fear is ephemeral and can turn quickly.  Plus, despite gold being a currency, it isn't the currency that _really_ matters.  In the end, we transact in fiat currencies.  And since liquidity crunches are resolved by transacting dollars, when liquidity disappears, people will sell what they can to meet margin calls in dollars, including gold.

Also, gold will not hold up in deflation IMO.


----------



## Rocko

I read in IBD, that the last time the FED employed a strategy  similar to operation twist, was in the 60's, the market fell 3%, but then had a 12% rally.

I hope that's the case, because the stocks I'm in are getting walloped.


----------



## JimBowie1958

Gold gets sold so fund managers can make margin calls on their other investments that have plunged below their leveraged account values, as I understand it, but I am no broker.


----------



## saveliberty

Sitting on the QQQ waiting for Monday.  That and some silver and gold accounts I bought Friday for a 27% discount over Thursday's close.


----------



## Zander

Gold is continuing it's downward slide.....is already down to $1615/oz this morning.


----------



## Vinson

Develop countries did not stop the heavy unnecessary expenses like war because these are great reason of  
depression and it create bad impact on economy. If they stop expense they overcome depression and problem.


----------



## Toro

Often times, when the market is in meltdown mode, Mondays are really bad, especially when Fridays close on the low, and the open on Tuesday continues the downward trend.  Then, around mid-day on Tuesday, the market reverses and there is a violent reversal to the upside.

I don't know if that will happen today or not.  I can't give you any fundamental reason to buy stocks, other than "the economy isn't falling apart - yet."  However, sentiment is terrible, which means we could be setting up for a good bounce.


----------



## iamwhatiseem

Toro said:


> Often times, when the market is in meltdown mode, Mondays are really bad, especially when Fridays close on the low, and the open on Tuesday continues the downward trend.  Then, around mid-day on Tuesday, the market reverses and there is a violent reversal to the upside.
> 
> I don't know if that will happen today or not.  I can't give you any fundamental reason to buy stocks, other than "the economy isn't falling apart - yet."  However, sentiment is terrible, which means we could be setting up for a good bounce.



You would have to have a genie in a bottle to predict the markets right now.
I don't give a hoot who it is - or what their reasoning is - the markets since the beginning of September have of course been insane.

 My take...and I think it is as good as anyone's - a fall is on the horizon that will be reminiscent of 2008...probably not as severe, but serious.
The market is on a clear bubble, evident as the face in the mirror. It was a matter of time as soon as this current bubble began in 2009. There are certainly signs that we are dangling over the edge...eh?


----------



## iamwhatiseem

Edit...up...I'll take that back...Bernanke came out and said the FED is standing by to "do whatever is necessary"..which will make the markets probably end up at plus 100 for the day.
In other words...he will do what it takes to maintain the bubble and place even more debt on the U.S. Treasury and warning legislators that they should not do anything at all. Just keep ignoring the debt so the highest earners in America can maintain their earnings.

Argue with that.


----------



## Toro

As I thought might happen, the Dow ripped up higher into the close, rallying nearly 400 points in the last hour.  I took all my shorts off early afternoon.  Whether it has any staying power, that remains to be seen.

Such rip-your-face-off rallies are common in bear markets.  I wouldn't be surprised if this went on for a few more days.  But I think, until proven otherwise, all rallies are to be sold or shorted.


----------



## JimBowie1958

Toro said:


> As I thought might happen, the Dow ripped up higher into the close, rallying nearly 400 points in the last hour.  I took all my shorts off early afternoon.  Whether it has any staying power, that remains to be seen.



It wont last. Read the rally was based on two false rumors, that Dexia will be rescued by Belgium (even if it does, it wont matter as Belgium drown in read along with Dexia) and that the ECB is going to recapitalize the banks, which is simply not going to happen ans none of the states have enough cash to do the job.



Toro said:


> Such rip-your-face-off rallies are common in bear markets.  I wouldn't be surprised if this went on for a few more days.  But I think, until proven otherwise, all rallies are to be sold or shorted.



Might till the next shoe hits the ground in the gradual disentigration of the Euro.


----------



## william the wie

At some point the disintegration of the Euro will not be gradual.


----------



## iamwhatiseem

Interesting...I was looking at the wild daily swings in the past 5 weeks.
So I wondered if this happened in 2007....and whalaah...it did. In the 2 months prior to the crash the markets look strangely similar.


----------



## Trajan

I was listening to john batchelor on  the way in this morning. he had aside from Kudlow which he does every tuesday night, steven russolillo from the dow jones, hes a pretty sharp guy, he says the whole run back to positive territory yesterday was due to a very short not very well documented blurb released in Europe on Dexia et al,  will be saved by a coordinated effort, his point there was absolute nothing new really and it was  one of the biggest back pedal panics he&#8217;d ever seen based especially,  on virtually nothing.  

The herd wanted to hear something, so they did and ran back the other direction by a huge margin....great, the take away being-  those speedy dopey dinosaurs running away from the T Tex, they got away with it this time , but, next time they  will get eaten when the rumors and or news is negative and the dancing to the  &#8216;electric  slide&#8217; starts. 

Damn I used to have it bookmarked, what are the bullshit auto stops again in the market?


----------



## Trajan

Ah found it...

one would think if it has to get to the point where on they have to stop the machine because they cannot control it,   they would just discontinue it.


----------



## Toro

If you believe the profit margins, stocks are very attractive here from a long term perspective. The median price earnings ratio of the Russell 3000 is 12x, well below the long term average of 15x. 

However, I think PEs will get to single digits and I don't know if I think the margins are real.


----------



## william the wie

Toro said:


> If you believe the profit margins, stocks are very attractive here from a long term perspective. The median price earnings ratio of the Russell 3000 is 12x, well below the long term average of 15x.
> 
> However, I think PEs will get to single digits and I don't know if I think the margins are real.


Toro net retiree dissavings will keep getting worse until 2023. I don't think the rules of thumb since 1939 are of any value at all in this market.


----------



## Zander

Personally, I think anyone that is invested in stocks (either long or short) right now is a fool. Why play with fire? I am content to sit in cash and short term treasuries. I may not earn much, but I won't lose much either. There will be a time to buy, now is not it.


----------



## JimBowie1958

Zander said:


> Personally, I think anyone that is invested in stocks (either long or short) right now is a fool. Why play with fire? I am content to sit in cash and short term treasuries. I may not earn much, but I won't lose much either. There will be a time to buy, now is not it.



When the credit from the financial giants evaporates, it wont matter what the previous quarterly employment stats are, or if the stock markets had huge rallies several times just before the credit blew away.

If the Big Banks fail and the government does not step in to bridge the gap then credit will evaporate for sure to miniscule levels.

From existing data it would seem that the Euro banks will be dragged down by Greek defaults setting off a chain of other banks failing, and that will spill over to the US and Asia as well.

This is an easy call as the underlying bad credit caused by bad sub-prime mortgages is growing exponentially, as I undrstand it.


----------



## usmcstinger

Jumping in and out of the market is not the way to make money. 

It is time in the market not timing the market.


----------



## mal

Stock Market is Climbing and Gold is Slipping... Just as I had Planned it. 

Let's talk again this time next year. 



peace...


----------



## mal

Gold has trended downward about 20% since last fall... If you wait it out, this Correction will complete and you will sit on your gold for a Generation just like those who held out in 1983 did...

2013 is 1983... And it's already started.



peace...


----------



## JimBowie1958

Off Drudge Report

Debt crisis: Greek euro exit looms closer as banks crumble - Telegraph


Eurozone debt crisis: Fears of 'panic' as investors pull out 1.4billion euro in two days | Mail Online


Cost of Greek exit from euro put at $1tn | Business | The Guardian


'Vulture funds' circle as Greece fears grow - Business News - Business - The Independent


----------



## Toro

The stock market is acting just awful, as if it is portending something bad. 

We are extremely oversold though, so a bounce may be near.  

For all the liberals who were cheerleading the Dow hitting new highs a month ago, this is why you should not do that.


----------



## Mad Scientist

mal said:


> Stock Market is Climbing and Gold is Slipping... Just as I had Planned it.
> 
> Let's talk again this time next year.


Gold is Climbing and the Stock Market is Slipping... Just as I had Planned it. 

Let's talk again *in 5-6 months.*

Oh and can someone tell me about "Computerized Trading"? I'm reading stories about how the clear majority of trades on the Stock Market are now done by "High Frequency Trading Computers". Anyone else heard about that?


----------



## Trajan

Toro said:


> The stock market is acting just awful, as if it is portending something bad.
> 
> We are extremely oversold though, so a bounce may be near.
> 
> For all the liberals who were cheerleading the Dow hitting new highs a month ago, this is why you should not do that.



tell Chris, he must haves stared like 6 threads every time it blipped another 100 points...


----------



## NYcarbineer

The stock market is going to have an intermediate term rally in the near future,

and it will likely run through the heart of the campaign.


----------



## NYcarbineer

mal said:


> Gold has trended downward about 20% since last fall... If you wait it out, this Correction will complete and you will sit on your gold for a Generation just like those who held out in 1983 did...
> 
> 2013 is 1983... And it's already started.
> 
> 
> 
> peace...



In 30 years you'll either be dead or too old to care where gold is trading.


----------



## thomaskent1991

Stock market is relevant with the business market and business market is relevant to the stock market. If business market does not working good so that business shares and equity would not give the best price and hence it will crash the stock market.


----------



## iamwhatiseem

My concern...is the $quadtrillion derivative market. 
The 4 largest banks in the world have $100 trillion "invested" in what has become a HIGHLY speculative market.
If/when the derivative market has a significant adjustment...there is not enough money in the world to pull the banks out of the abyss. 
Right now mainstream sources downplay it, or not report on it at all...much like they did in 2007 when the same sources were warning about a mortgage crises.

 If the NYSE casino loses a couple derivative bets - fugetaboudit.


----------



## saveliberty

thomaskent1991 said:


> Stock market is relevant with the business market and business market is relevant to the stock market. If business market does not working good so that business shares and equity would not give the best price and hence it will crash the stock market.



That is old school thinking.  There is a major disconnect between business and the markets right now.  I buy on dips and unload ASAP with small gains (2-5%).  Limited market exposure is paramount.


----------



## iamwhatiseem

saveliberty said:


> thomaskent1991 said:
> 
> 
> 
> Stock market is relevant with the business market and business market is relevant to the stock market. If business market does not working good so that business shares and equity would not give the best price and hence it will crash the stock market.
> 
> 
> 
> 
> That is old school thinking.  There is a major disconnect between business and the markets right now.  I buy on dips and unload ASAP with small gains (2-5%).  Limited market exposure is paramount.
Click to expand...


Absolutely.
That is a pre-1980 way of looking at the markets.
Today the NYSE is Las Vegas with better odds.


----------



## Trajan

well time to resurrect this thread for a blurb;


Market Savior? Stocks Might Be 50% Lower Without Fed

A report from the Federal Reserve Bank of New York suggests that the bulk of equity returns for more than a decade are due to actions by the US central bank.

Theoretically, the S&P 500 [.SPX  1334.76    -6.69  (-0.5%)   ] would be more than 50 percent lower&#8212;at the 600 level&#8212;if the bullish price action preceding Fed announcements was excluded, the study showed.

Posted on the New York Fed&#8217;s web site Wednesday, the study sought out to explain why equities receive such a high premium over less risky assets such as bonds.

What they found was that the Federal Reserve [cnbc explains] has had an outsized impact on equities relative to other asset classes.

For example, the market has a tendency to rise in the 24-hour period before the release of the Fed&#8217;s statement on interest rates and the economy, presumably on expectations Chairman Ben Bernanke and his predecessor, Alan Greenspan, would discuss or implement a stimulus measure to lift asset prices.

The FOMC has released eight announcements a year at 2:15 ET since 1994. The study took the gains in the S&P 500 from 2 pm the day before the announcement to 2 pm the day of the statement and subtracted that market move from the S&P 500&#8217;s total return over that time span.

Without the gains in anticipation of a positive Fed action, the S&P 500 would stand at just 600 today, rather than above 1300.

more at-




News Headlines


----------



## saveliberty

Friday was a classic new market day.  Absolutely no reason for the market to go up other than some major players taking neutral news to cover their shorts.  Next week will be a blood bath.


----------



## iamwhatiseem

Trajan said:


> well time to resurrect this thread for a blurb;
> 
> 
> Market Savior? Stocks Might Be 50% Lower Without Fed
> 
> A report from the Federal Reserve Bank of New York suggests that the bulk of equity returns for more than a decade are due to actions by the US central bank.
> 
> Theoretically, the S&P 500 [.SPX  1334.76    -6.69  (-0.5%)   ] would be more than 50 percent lowerat the 600 levelif the bullish price action preceding Fed announcements was excluded, the study showed.
> 
> Posted on the New York Feds web site Wednesday, the study sought out to explain why equities receive such a high premium over less risky assets such as bonds.
> 
> What they found was that the Federal Reserve [cnbc explains] has had an outsized impact on equities relative to other asset classes.
> 
> For example, the market has a tendency to rise in the 24-hour period before the release of the Feds statement on interest rates and the economy, presumably on expectations Chairman Ben Bernanke and his predecessor, Alan Greenspan, would discuss or implement a stimulus measure to lift asset prices.
> 
> The FOMC has released eight announcements a year at 2:15 ET since 1994. The study took the gains in the S&P 500 from 2 pm the day before the announcement to 2 pm the day of the statement and subtracted that market move from the S&P 500s total return over that time span.
> 
> Without the gains in anticipation of a positive Fed action, the S&P 500 would stand at just 600 today, rather than above 1300.
> 
> more at-
> 
> 
> 
> 
> News Headlines



Yeah - but we didn't need an article to tell us this did we?
The government wants the bubble markets to exist just as much as those that profit from it.


----------



## Douger

Hang in there and wait for *the* war. I'll stick with growing food to supply the cannon fodder.


----------



## Toro

Douger said:


> Hang in there and wait for *the* war. I'll stick with growing food to supply the cannon fodder.



Remember to stock up on gold and canned goods too.  It's not a bunker without those.


----------



## Trajan

damn straight


----------



## KissMy

Toro said:


> Douger said:
> 
> 
> 
> Hang in there and wait for *the* war. I'll stick with growing food to supply the cannon fodder.
> 
> 
> 
> 
> Remember to stock up on gold and canned goods too.  It's not a bunker without those.
Click to expand...


Stocking up on food is a great idea this year after the bad weather around the world severely damaged the crops this year. Corn, Wheat, Soybeans & Rice have skyrocketed in recent months. Retail food prices are going to follow.


----------



## KissMy

Trajan said:


> well time to resurrect this thread for a blurb;
> 
> Market Savior? Stocks Might Be 50% Lower Without Fed
> 
> A report from the Federal Reserve Bank of New York suggests that the bulk of equity returns for more than a decade are due to actions by the US central bank.
> 
> Theoretically, the S&P 500 [.SPX  1334.76    -6.69  (-0.5%)   ] would be more than 50 percent lowerat the 600 levelif the bullish price action preceding Fed announcements was excluded, the study showed.
> 
> Posted on the New York Feds web site Wednesday, the study sought out to explain why equities receive such a high premium over less risky assets such as bonds.
> 
> What they found was that the Federal Reserve [cnbc explains] has had an outsized impact on equities relative to other asset classes.
> 
> For example, the market has a tendency to rise in the 24-hour period before the release of the Feds statement on interest rates and the economy, presumably on expectations Chairman Ben Bernanke and his predecessor, Alan Greenspan, would discuss or implement a stimulus measure to lift asset prices.
> 
> The FOMC has released eight announcements a year at 2:15 ET since 1994. The study took the gains in the S&P 500 from 2 pm the day before the announcement to 2 pm the day of the statement and subtracted that market move from the S&P 500s total return over that time span.
> 
> Without the gains in anticipation of a positive Fed action, the S&P 500 would stand at just 600 today, rather than above 1300.
> 
> more at- News Headlines



Never forget that Executive Order 12631 created the President's Working Group on Financial Markets. This allows direct stock market manipulation by all the president's men.


----------



## william the wie

I don't think Obama and Bernancke figured in that the EU would unravel. a crash is likely.


----------



## iamwhatiseem

william the wie said:


> I don't think Obama and Bernancke figured in that the EU would unravel. a crash is likely.



Not to split hairs...but a crash is not "likely" - it is guaranteed. It is grossly over-sold and over invested. It is a matter of time. 
It's like watching a drunk guy flirting with a married woman whose 300lb. husband returning from the bathroom is known for a quick temper. You know what is next.
Same with the stock market. I made a thread awhile back showing how ALL of the worlds markets have lost a LOT of value since 2010...most have lost double-digit percentage losses....except America - a 5% gain.
  You might as well grab the popcorn, it will happen.


----------



## Trajan

Intel missed their estimates by a smidgen, BUT the news is they dropped their 2012 estimate from 8-9% to 3-5%.....


I have friends there, they have ramped down the  Chandler expansion and total capital $$ outlays for the year at 12-13Bn..they are going to pull back.


----------



## Toro

The economy is going up on expectations of yet more QE. I'm beginning to fucking hate that term. I can't turn on CNBC without hearing continuously "QE QE QE." Like a crack addict, the market gets its high from monetary stimulus then collapses when it is withdrawn. 

Monetary policy in this country has become a joke.


----------



## Toro

However, I did buy a bit of stock today. Some stocks are cheap and I'm just socking those away.


----------



## iamwhatiseem

Toro said:


> The economy is going up on expectations of yet more QE. I'm beginning to fucking hate that term. I can't turn on CNBC without hearing continuously "QE QE QE." Like a crack addict, the market gets its high from monetary stimulus then collapses when it is withdrawn.
> 
> Monetary policy in this country has become a joke.



It is a simple policy really...your addiction analogy is pretty accurate. In order to sustain the bubble, it needs a "fix" of free cash at strategic intervals. 'Course that cash is the money taken out of our paychecks each week.
  We are f*cked. The game masters have everything to their advantage. They have the government fully willing to give them taxpayer money to play with, no one is really talking that much about how over-valued the market is...so they can keep pumping money in...trading it around alot, diversifying as much as possible. If you know what you are doing - there are $billions upon $billions to make in a bubble like this...as long as you don't care that this game's consequences are all being paid by someone else.
It is outrageously FUBAR. And I am beyond sick of it. I am so f*cking tired of trying to do business in a skittish, scarce economy. And neither side of the government is in any way interested in fixing one Goddamn thing other than giving the banks and finance their fix. 
 Just like I said in another thread - this is like watching a drunk flirting with a man's wife who is a short-tempered 300lb, gorilla who should be walking out of the bathroom at any second.


----------



## william the wie

Toro said:


> However, I did buy a bit of stock today. Some stocks are cheap and I'm just socking those away.


Just a question you are aware that Reinhardt pegged the collapse of the Euro for oct of this year? I think she made the prediction late last year but it didn't get a lot of play. If you are aware of that cool, if not I would google for her statement and reconsider your strategy. It may still be a good idea but I would not discount the world's leading expert on sovereign debt lightly.


----------



## Toro

william the wie said:


> Toro said:
> 
> 
> 
> However, I did buy a bit of stock today. Some stocks are cheap and I'm just socking those away.
> 
> 
> 
> Just a question you are aware that Reinhardt pegged the collapse of the Euro for oct of this year? I think she made the prediction late last year but it didn't get a lot of play. If you are aware of that cool, if not I would google for her statement and reconsider your strategy. It may still be a good idea but I would not discount the world's leading expert on sovereign debt lightly.
Click to expand...


Be very skeptical of prognostications.  I have done this for a long, long time, and they are rarely correct with regards to timing.

I am about 75% cash, which means I'm bearish.  However, I also recognize that I may be wrong.  Thus, I want some exposure.  I'm short the Canadian dollar and silver, so my risk exposure is actually 10%.  But some stocks are getting silly.  I bought Goldman Sachs for the very first time today.  It is trading at 0.79x tangible book value.  At the depth of the crisis, it traded at 0.67x TBV.  There doesn't seem a lot of downside to me.  Cisco, another that I bought, trades at 4.25x enterprise value to cash flow.  That's ridiculous.  ConAgra has a 3.9% dividend yield, higher than their bond.  There are all sorts of great American companies that are on sale.  I'm buying knowing I'm buying cheap and don't care what happens in the macro economy.  If things get worse and valuations get cheaper - which is what I want - I will buy more.  

The bear market for the average stock began in 1998.  That means we are 14 years into the bear market.  The average bear market lasts 10-12 years, with the longest in history lasting ~19 years.  I don't know when it ends - I think there is one more big leg down - but we are definitely in the back half of this bear market.  As I look around the world, stocks are one of the most attractive asset classes around.


----------



## william the wie

Toro said:


> william the wie said:
> 
> 
> 
> 
> 
> Toro said:
> 
> 
> 
> However, I did buy a bit of stock today. Some stocks are cheap and I'm just socking those away.
> 
> 
> 
> Just a question you are aware that Reinhardt pegged the collapse of the Euro for oct of this year? I think she made the prediction late last year but it didn't get a lot of play. If you are aware of that cool, if not I would google for her statement and reconsider your strategy. It may still be a good idea but I would not discount the world's leading expert on sovereign debt lightly.
> 
> Click to expand...
> 
> 
> Be very skeptical of prognostications.  I have done this for a long, long time, and they are rarely correct with regards to timing.
> 
> I am about 75% cash, which means I'm bearish.  However, I also recognize that I may be wrong.  Thus, I want some exposure.  I'm short the Canadian dollar and silver, so my risk exposure is actually 10%.  But some stocks are getting silly.  I bought Goldman Sachs for the very first time today.  It is trading at 0.79x tangible book value.  At the depth of the crisis, it traded at 0.67x TBV.  There doesn't seem a lot of downside to me.  Cisco, another that I bought, trades at 4.25x enterprise value to cash flow.  That's ridiculous.  ConAgra has a 3.9% dividend yield, higher than their bond.  There are all sorts of great American companies that are on sale.  I'm buying knowing I'm buying cheap and don't care what happens in the macro economy.  If things get worse and valuations get cheaper - which is what I want - I will buy more.
> 
> The bear market for the average stock began in 1998.  That means we are 14 years into the bear market.  The average bear market lasts 10-12 years, with the longest in history lasting ~19 years.  I don't know when it ends - I think there is one more big leg down - but we are definitely in the back half of this bear market.  As I look around the world, stocks are one of the most attractive asset classes around.
Click to expand...

I've been using super stock screener online to pick the ridiculously undervalued stocks I buy myself but I am also buying LEAP puts on overvalued stocks, Apple for example was very nice to me.


----------



## Trajan

Biiig misses...

UPDATE: AAPL -6.25% AH

Major misses everywhere, and this for the second quarter in a row - from the Q3 earnings report:

    APPLE 3Q REV. $35.02B, EST. $37.25B
    APPLE 3Q EPS $9.32, EXP. $10.37
    APPLE 3Q NET PROFIT $8.8B
    APPLE SEES 4Q REV. ABOUT $34B, EST. $38.01B
    AAPLE 3Q GROSS MARGIN 42.8%, EST. 43.8%
    APPLE SOLD 17.0 MILLION IPADS DURING QTR, UNIT EST. 15.4M
    APPLE 3Q IPOD UNITS SOLD 6.8MLN , DOWN 10%
    APPLE SOLD 4.0 MILLION MACS DURING QTR, UNIT EST. 4.3M
    APPLE SOLD 6.8 MILLION IPODS IN QTR, UNIT EST. 6.6M


----------



## Trajan

Toro said:


> william the wie said:
> 
> 
> 
> 
> 
> Toro said:
> 
> 
> 
> However, I did buy a bit of stock today. Some stocks are cheap and I'm just socking those away.
> 
> 
> 
> Just a question you are aware that Reinhardt pegged the collapse of the Euro for oct of this year? I think she made the prediction late last year but it didn't get a lot of play. If you are aware of that cool, if not I would google for her statement and reconsider your strategy. It may still be a good idea but I would not discount the world's leading expert on sovereign debt lightly.
> 
> Click to expand...
> 
> 
> Be very skeptical of prognostications.  I have done this for a long, long time, and they are rarely correct with regards to timing.
> 
> I am about 75% cash, which means I'm bearish.  However, I also recognize that I may be wrong.  Thus, I want some exposure.  I'm short the Canadian dollar and silver, so my risk exposure is actually 10%.  But some stocks are getting silly.  I bought Goldman Sachs for the very first time today.  It is trading at 0.79x tangible book value.  At the depth of the crisis, it traded at 0.67x TBV.  There doesn't seem a lot of downside to me.  Cisco, another that I bought, trades at 4.25x enterprise value to cash flow.  That's ridiculous.  ConAgra has a 3.9% dividend yield, higher than their bond.  There are all sorts of great American companies that are on sale.  I'm buying knowing I'm buying cheap and don't care what happens in the macro economy.  If things get worse and valuations get cheaper - which is what I want - I will buy more.
> 
> The bear market for the average stock began in 1998.  That means we are 14 years into the bear market.  The average bear market lasts 10-12 years, with the longest in history lasting ~19 years.  I don't know when it ends - I think there is one more big leg down - but we are definitely in the back half of this bear market.  As I look around the world, stocks are one of the most attractive asset classes around.
Click to expand...


I reshuffled everything on the last dip, we talked about it here if I recall, my largest blocks left are gold ( I am mulling dropping out on the next broach over 1600...) and the dividend Blues I bought on that dip and cash of course.......I finally exited AKP,  a Cali muni fund, bought in at 12 and change, I made a killing and I have no faith left in munis here now despite the strong buy reco's, I think I have been lucky enough.


----------



## Zander

Toro said:


> william the wie said:
> 
> 
> 
> 
> 
> Toro said:
> 
> 
> 
> However, I did buy a bit of stock today. Some stocks are cheap and I'm just socking those away.
> 
> 
> 
> Just a question you are aware that Reinhardt pegged the collapse of the Euro for oct of this year? I think she made the prediction late last year but it didn't get a lot of play. If you are aware of that cool, if not I would google for her statement and reconsider your strategy. It may still be a good idea but I would not discount the world's leading expert on sovereign debt lightly.
> 
> Click to expand...
> 
> 
> Be very skeptical of prognostications.  I have done this for a long, long time, and they are rarely correct with regards to timing.
> 
> I am about 75% cash, which means I'm bearish.  However, I also recognize that I may be wrong.  Thus, I want some exposure.  I'm short the Canadian dollar and silver, so my risk exposure is actually 10%.  But some stocks are getting silly.  I bought Goldman Sachs for the very first time today.  It is trading at 0.79x tangible book value.  At the depth of the crisis, it traded at 0.67x TBV.  There doesn't seem a lot of downside to me.  Cisco, another that I bought, trades at 4.25x enterprise value to cash flow.  That's ridiculous.  ConAgra has a 3.9% dividend yield, higher than their bond.  There are all sorts of great American companies that are on sale.  I'm buying knowing I'm buying cheap and don't care what happens in the macro economy.  If things get worse and valuations get cheaper - which is what I want - I will buy more.
> 
> The bear market for the average stock began in 1998.  That means we are 14 years into the bear market.  The average bear market lasts 10-12 years, with the longest in history lasting ~19 years.  I don't know when it ends - I think there is one more big leg down - but we are definitely in the back half of this bear market.  As I look around the world, stocks are one of the most attractive asset classes around.
Click to expand...


Appreciate your opinion. Thanks for taking the time to post it! 

Personally, I am bearish as hell- more than I have ever been.  I sold my positions in the "long" bond at a considerable profit about 6 weeks ago and I am  now 100% CASH. I  plan on staying that way for a while.  In my opinion, we still have lots of "flation", of the "De" variety to deal with..........wake me up around 2015.


----------



## saveliberty

I'll play for a week or two when the S&P hits 1287.


----------



## Moonglow

Toro said:


> The other thread has turned into the usual mindless political hack garbage. This thread is to discuss the stock market crash without blaming everything on Republicans or Democrats by people who barely know the difference between a stock and livestock.
> 
> The UK has fallen 12% in 5 days. Switzerland has fallen 17% in 2 weeks.



Yes indeed, they will fall as long as interest rates for loans to countries are high, or hard to get.


----------



## iamwhatiseem

The final destination for Europe is now just ahead folks...


----------



## saveliberty

Even Germany is starting to enter the cross hairs of Moody's and S&P.


----------



## uscitizen

saveliberty said:


> Even Germany is starting to enter the cross hairs of Moody's and S&P.



Those 2 companys that rated the junk mortgage packages AAA?


----------



## saveliberty

uscitizen said:


> saveliberty said:
> 
> 
> 
> Even Germany is starting to enter the cross hairs of Moody's and S&P.
> 
> 
> 
> 
> Those 2 companys that rated the junk mortgage packages AAA?
Click to expand...


Yes, Germany's ratings are probably too high still.


----------



## Toro

This has been by far the hardest environment of my career.  I am down over the past 18 months, something that has never happened before.  I have realized that I am trading all wrong, so I've stopped, or at least cut back, and am instead buying stocks when they get cheap and just waiting.

Money is being withdrawn from the stock market at an astonishing rate, so much so that the market has become stupid.  Bond yields for many companies are now lower than dividend yields.  It makes no sense, except when you realize that hundreds of billions of dollars have flowed into bond funds and billions have flowed out of stock funds.  Since 1996, we now have net withdrawals out of the stock market whereas we've had $800 billion flowing into bond markets.  That's ridiculous.  Never in my career have corporations been as strong as they are now.  I have made a lot of money over the years investing where capital has withdrawn from the market.  I have always applied that to industries, whether that's hotels or semiconductors or gold.  I've never applied that to the broad market.  Now I am.

I am still sitting on a mountain of cash.  I still expect one big swoosh down.  But capital markets have become so distorted, and equity markets so hated, anyone investing in stocks will do very well over the next decade IMHO, better than almost every other asset class, though I expect a fair amount of choppiness between now and then.


----------



## Valerie

Hold onto your hats!


----------



## saveliberty

I have been buying on major down days and exiting as quickly as possible with a 2-3% upswing.  Limited exposure seems to work pretty well at the moment.  Long term though, I agree, I have to be in the market.  I think that will be reasonable in 2014.


----------



## Toro

One trade I am considering is shorting the 10 year Treasury and using the proceeds to invest in high quality, high quality, high dividend paying stocks.  I haven't done it yet, but the idea is to short an amount of Treasuries then go long 60%-75% of that amount in stocks.  I was thinking of shorting $100k in Treasuries and going long $70k in stocks.  

High yielding US stocks I currently own are JNJ and CAG.  I also own MET, which I expect to hike it's dividend soon.  Other potential stocks include CPB, GE, HNZ, JPM, K, KMB and PG.  I would also throw UL into that mix too.  I am a buyer when the dividend yield hits 4%, which is generally 6%-10% down from here.

Such a trade would generate a positive carry of about 1%, i.e. if you pay the Treasury yield of 1.45% and receive the dividends from the stocks, your net return is ~$1000.

The risk, of course, is a negative move in stocks and a positive move in bonds.  If the yield on the 10Y falls to 0.1%, the bond price rises 12%.  If it falls to -0.5%, it rises 25%.  The stocks listed above are low beta stocks that are unlikely to fall more than 20%-30% in the event of a cataclysm.  What does give me pause, however, is that in 1973-74, stock PEs were lower than their concurrent dividend yields.  Anything can happen in financial markets, so one must prepare for all possibilities, no matter how remote.


----------



## Zander

Toro said:


> One trade I am considering is shorting the 10 year Treasury and using the proceeds to invest in high quality, high quality, high dividend paying stocks.  I haven't done it yet, but the idea is to short an amount of Treasuries then go long 60%-75% of that amount in stocks.  I was thinking of shorting $100k in Treasuries and going long $70k in stocks.
> 
> High yielding US stocks I currently own are JNJ and CAG.  I also own MET, which I expect to hike it's dividend soon.  Other potential stocks include CPB, GE, HNZ, JPM, K, KMB and PG.  I would also throw UL into that mix too.  I am a buyer when the dividend yield hits 4%, which is generally 6%-10% down from here.
> 
> Such a trade would generate a positive carry of about 1%, i.e. if you pay the Treasury yield of 1.45% and receive the dividends from the stocks, your net return is ~$1000.
> 
> The risk, of course, is a negative move in stocks and a positive move in bonds.  If the yield on the 10Y falls to 0.1%, the bond price rises 12%.  If it falls to -0.5%, it rises 25%.  The stocks listed above are low beta stocks that are unlikely to fall more than 20%-30% in the event of a cataclysm.  What does give me pause, however, is that in 1973-74, stock PEs were lower than their concurrent dividend yields.  Anything can happen in financial markets, so one must prepare for all possibilities, no matter how remote.



I'd be careful with that trade. it seems so reasonable and logical that it is sure to fail. After all, how much lower can Treasury yields go?  

I'd do the exact opposite. Short stocks, especially high quality, low beta, stocks with good dividend yields, and go long treasuries and cash.


----------



## Valerie

Here is one I am watching like you read about...  *CLF*

Hit 52 week low today..earnings out tomorrow.  





> Cliffs Natural Resources Inc. (CLF)
> -NYSE
> 
> 42.67 Down 1.65(3.72%) 4:05PM EDT|After Hours: 42.02 Down 0.65 (1.52%) 7:41PM EDT
> Add to Portfolio
> Prev Close:	44.32
> Open:	44.45
> Bid:	41.84 x 200
> Ask:	42.14 x 500
> 1y Target Est:	77.44
> Beta:	2.37
> *Next Earnings Date:	25-Jul-12CLF Earnings announcement*
> Day's Range:	42.18 - 44.95
> 52wk Range:	42.18 - 98.61
> Volume:	5,241,759
> Avg Vol (3m):	3,637,270
> Market Cap:	6.08B
> P/E (ttm):	3.87
> EPS (ttm):	11.01
> Div & Yield:	2.50 *(5.40%)*
> 
> http://finance.yahoo.com/q?s=clf&ql=1




Watch the volume and see if you can't get some at a bargain.


----------



## Zander

Valerie said:


> Here is one I am watching like you read about...  *CLF*
> 
> Hit 52 week low today..earnings out tomorrow.
> 
> 
> 
> 
> 
> 
> Cliffs Natural Resources Inc. (CLF)
> -NYSE
> 
> 42.67 Down 1.65(3.72%) 4:05PM EDT|After Hours: 42.02 Down 0.65 (1.52%) 7:41PM EDT
> Add to Portfolio
> Prev Close:	44.32
> Open:	44.45
> Bid:	41.84 x 200
> Ask:	42.14 x 500
> 1y Target Est:	77.44
> Beta:	2.37
> *Next Earnings Date:	25-Jul-12CLF Earnings announcement*
> Day's Range:	42.18 - 44.95
> 52wk Range:	42.18 - 98.61
> Volume:	5,241,759
> Avg Vol (3m):	3,637,270
> Market Cap:	6.08B
> P/E (ttm):	3.87
> EPS (ttm):	11.01
> Div & Yield:	2.50 *(5.40%)*
> 
> 
> 
> 
> 
> Watch the volume and see if you can't get some at a bargain.
Click to expand...

Hurry Hurry!! see if you can catch the falling knife!!!


----------



## Toro

Zander said:


> I'd be careful with that trade. it seems so reasonable and logical that it is sure to fail. After all, how much lower can Treasury yields go?
> 
> I'd do the exact opposite. Short stocks, especially high quality, low beta, stocks with good dividend yields, and go long treasuries and cash.



Depends on your time frame.

The Treasury market reminds me a lot - A LOT - of tech stocks in 1999 or housing in 2006.  Real yields are negative across most of the curve, which is tantamount to paying 100x earnings for Cisco in 99 or $400k for that 1 bedroom condo in San Diego in 06.  

The people who've been arguing for deflation have been wrong.  We don't have deflation in the US, and most of the deflationary forces have passed us by.  We do have deflationary forces in the periphery of Europe, but not in the core.   So to argue for shorting Treasuries here is to argue for technicals and continued manipulation by the Fed, not fundamentals.  That can last for awhile.  Maybe the 30 year can go to 2%, who knows?  A lesson I've learned is that things can go for much longer, much farther than one might think is reasonable.  But eventually, the laws of economics win out in the end.  That's why Treasury bond prices will be much lower a decade out than they are today.


----------



## Valerie

Zander said:


> Valerie said:
> 
> 
> 
> Here is one I am watching like you read about...  *CLF*
> 
> Hit 52 week low today..earnings out tomorrow.
> 
> 
> 
> 
> 
> 
> Cliffs Natural Resources Inc. (CLF)
> -NYSE
> 
> 42.67 Down 1.65(3.72%) 4:05PM EDT|After Hours: 42.02 Down 0.65 (1.52%) 7:41PM EDT
> Add to Portfolio
> Prev Close:	44.32
> Open:	44.45
> Bid:	41.84 x 200
> Ask:	42.14 x 500
> 1y Target Est:	77.44
> Beta:	2.37
> *Next Earnings Date:	25-Jul-12CLF Earnings announcement*
> Day's Range:	42.18 - 44.95
> 52wk Range:	42.18 - 98.61
> Volume:	5,241,759
> Avg Vol (3m):	3,637,270
> Market Cap:	6.08B
> P/E (ttm):	3.87
> EPS (ttm):	11.01
> Div & Yield:	2.50 *(5.40%)*
> 
> 
> 
> 
> 
> Watch the volume and see if you can't get some at a bargain.
> 
> Click to expand...
> 
> Hurry Hurry!! see if you can catch the falling knife!!!
Click to expand...







  It's not easy but if you're patient, the volume always tells the tale in the end...


----------



## Toro

I am not bullish on commodity stocks.  I think commodity stocks will be among the worst performers over the next 10 years.  Maybe not the next 10 months, but I think it won't be a place for the long-term.


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## Valerie

Toro said:


> I am not bullish on commodity stocks.  I think commodity stocks will be among the worst performers over the next 10 years.  Maybe not the next 10 months, but I think it won't be a place for the long-term.







The strong dollar has weakened commodities but IMO it is going to take a few years to play out.  Individual equities will show their bottom if you pay attention, is all I'm saying...


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## Zander

Toro said:


> Zander said:
> 
> 
> 
> I'd be careful with that trade. it seems so reasonable and logical that it is sure to fail. After all, how much lower can Treasury yields go?
> 
> I'd do the exact opposite. Short stocks, especially high quality, low beta, stocks with good dividend yields, and go long treasuries and cash.
> 
> 
> 
> 
> Depends on your time frame.
> 
> The Treasury market reminds me a lot - A LOT - of tech stocks in 1999 or housing in 2006.  Real yields are negative across most of the curve, which is tantamount to paying 100x earnings for Cisco in 99 or $400k for that 1 bedroom condo in San Diego in 06.
> 
> The people who've been arguing for deflation have been wrong.  We don't have deflation in the US, and most of the deflationary forces have passed us by.  We do have deflationary forces in the periphery of Europe, but not in the core.   So to argue for shorting Treasuries here is to argue for technicals and continued manipulation by the Fed, not fundamentals.  That can last for awhile.  Maybe the 30 year can go to 2%, who knows?  A lesson I've learned is that things can go for much longer, much farther than one might think is reasonable.  But eventually, the laws of economics win out in the end.  That's why Treasury bond prices will be much lower a decade out than they are today.
Click to expand...


We'll have to agree to disagree about deflation.  

I agree that *over the long term*, interest rates will rise and Treasuries will be hammered.  But that may be a LONG time from now. Why fight the trend?  Thank God I don't need to trade for a living - it's a tough gig. Best of luck to you Toro!


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## Toro

Also, the reason why I think there is one more swoosh down is because I think the end game to all this is a currency crisis.  We are in the midst of one in Europe.  I think Japan will be next, and maybe - maybe - we will have one in America.

If we have one here, people will discover that Treasuries are NOT safe.  Even though most professionals are bearish on Treasuries - which gives me pause over my own bearishness - at the end of the day, they rush to Treasuries for protection.  

It is an axiom that at the end of a bull market, they shoot all survivors.  We have been in a 30 year bull market in Treasury bonds.  At the end of a bull market, they will shoot Treasuries too, especially if there is a dollar crisis.  There is no reason to expect that the bull market in Treasuries won't end any differently than the bull market in tech stocks or housing.

A bet on Treasuries is an implicit bet on the dollar.  If we have a dollar crisis, there will be violent moves in the Treasuries as investors realize the last safe haven is no longer safe, and the moves will be unlike anything we've seen before.  I don't know if that will happen - I give it maybe a 30% chance - but that is higher than what most market participants believe.


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## boedicca

Valerie said:


> Toro said:
> 
> 
> 
> I am not bullish on commodity stocks.  I think commodity stocks will be among the worst performers over the next 10 years.  Maybe not the next 10 months, but I think it won't be a place for the long-term.
> 
> 
> 
> 
> 
> 
> 
> 
> The strong dollar has weakened commodities but IMO it is going to take a few years to play out.  Individual equities will show their bottom if you pay attention, is all I'm saying...
Click to expand...



You'll love this.  The Hegemony want to prevent the Small Folks "Return of Capital"

_
Two years ago, in January 2010, Zero Hedge wrote "This Is The Government: Your Legal Right To Redeem Your Money Market Account Has Been Denied" which became one of our most read stories of the year. The reason? Perhaps something to do with an implicit attempt at capital controls by the government on one of the primary forms of cash aggregation available: $2.7 trillion in US money market funds. The proximal catalyst back then were new proposed regulations seeking to pull one of these three core pillars (these being no volatility, instantaneous liquidity, and redeemability) from the foundation of the entire money market industry, by changing the primary assumptions of the key Money Market Rule 2a-7. A key proposal would give money market fund managers the option to "suspend redemptions to allow for the orderly liquidation of fund assets." In other words: an attempt to prevent money market runs (the same thing that crushed Lehman when the Reserve Fund broke the buck). ..._

This Is The Government: Your Legal Right To Redeem Your Money Market Account Has Been Denied - The Sequel | ZeroHedge


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## Toro

Zander said:


> We'll have to agree to disagree about deflation.
> 
> I agree that *over the long term*, interest rates will rise and Treasuries will be hammered.  But that may be a LONG time from now. Why fight the trend?  Thank God I don't need to trade for a living - it's a tough gig. Best of luck to you Toro!



I am happy that the trade has worked out for you.  And I am 75% in cash, which means I am implicitly long Treasury bills.

But there is no deflation Zander.  Our deflation was in housing prices and the collapse of the debt markets.  The only potential remaining deflationary force is the federal government.  If the federal government decides to start slashing spending and borrowing less, then that will be deflationary.  But the housing market has gone through most, if not all of its decline, and most of the bad mortgage debt has been expunged from the system.  

Like I said many years ago, bet on the guys with the printing press.  And the guys with the printing press are the reason why your long position in Treasuries has done so well.  I can't game politics.  That's why I've sucked over the past 18 months - so much of the moves have been because of politics.  If the Fed stopped buying Treasuries, Treasuries would get crushed.  Buying Treasuries here, you are betting on the Fed continuing to implement QE indefinitely.  To me, that's a dangerous game, though it seems likely to continue for awhile.  I can't tell you exactly when they will stop buying, but it will happen one day, and it won't be pretty.


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## uscitizen

Toro said:


> I am not bullish on commodity stocks.  I think commodity stocks will be among the worst performers over the next 10 years.  Maybe not the next 10 months, but I think it won't be a place for the long-term.



Then there is the scandal about the 2 commodity trading houses losing over 200 million of investors money.  As in it was supposed to be deposited in the bank but was not there.


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## Trajan

Toro said:


> I am not bullish on commodity stocks.  I think commodity stocks will be among the worst performers over the next 10 years.  Maybe not the next 10 months, but I think it won't be a place for the long-term.



Agreed, the dollar will melt a bit gold has another good jump and commodities in this environment don't make sense to me. That's my barroom prophecy 

That laundry list of yours is pretty close to mine, except PEP, one of my favs, its my second largset holding, been buying in spurts for a decade,  plus jnj,  PG and intel are my hole cards so to speak, I am waiting for WMT to drop back 10 % then I am in. That will probably  be my last major move aside from dumping my gold before I retire.


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## Toro

I've gotten to the point where I don't care a whole lot about what the market does over the short term.  It has become impossible to trade, given that so much of it is driven by obscure events in Europe as well as any rumours about QE round 427, or whatever the fuck it is now.  The only reason why the Dow popped 100 points in the last hour today is because of a WSJ article about yet more Fed intervention.  Frankly, I think its pathetic.  Monetary policy in this country has become a joke.  The only time the market has gone up is when QE has been in play.

What's absolutely amazing to me is how easy it would have been to make money in retrospect.  We are in the third year of the exact same playbook.  The economy is grinding to a halt in the summer so the Fed jumps to the rescue with (puke) QE.  The market rises in the Fall and early winter.  Come April and May, QE is on the verge of ending, news that Greece can't pay its bills, and the economy is nose-diving in the summer.  And so on.  This is the third year in a row when this has played out.  You are taught that _it can't be this fucking easy!_  Yet, it is!  As a citizen, I am disgusted by what is going on.  As a trader and investor, I can only adapt to my environment and take the opportunities the market provides.


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## Trajan

Zander said:


> Valerie said:
> 
> 
> 
> Here is one I am watching like you read about...  *CLF*
> 
> Hit 52 week low today..earnings out tomorrow.
> 
> 
> 
> 
> 
> 
> Cliffs Natural Resources Inc. (CLF)
> -NYSE
> 
> 42.67 Down 1.65(3.72%) 4:05PM EDT|After Hours: 42.02 Down 0.65 (1.52%) 7:41PM EDT
> Add to Portfolio
> Prev Close:	44.32
> Open:	44.45
> Bid:	41.84 x 200
> Ask:	42.14 x 500
> 1y Target Est:	77.44
> Beta:	2.37
> *Next Earnings Date:	25-Jul-12CLF Earnings announcement*
> Day's Range:	42.18 - 44.95
> 52wk Range:	42.18 - 98.61
> Volume:	5,241,759
> Avg Vol (3m):	3,637,270
> Market Cap:	6.08B
> P/E (ttm):	3.87
> EPS (ttm):	11.01
> Div & Yield:	2.50 *(5.40%)*
> 
> 
> 
> 
> 
> Watch the volume and see if you can't get some at a bargain.
> 
> Click to expand...
> 
> Hurry Hurry!! see if you can catch the falling knife!!!
Click to expand...


Since we are getting all Cramered  out here, one for you;Sdrl.....it's the future, price is setup in the middle of its 52 week frame, well managed co. 

No, I am not gonna tell you, go look it up


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## Zander

Trajan said:


> Zander said:
> 
> 
> 
> 
> 
> Valerie said:
> 
> 
> 
> Here is one I am watching like you read about...  *CLF*
> 
> Hit 52 week low today..earnings out tomorrow.
> 
> 
> 
> 
> 
> 
> Watch the volume and see if you can't get some at a bargain.
> 
> 
> 
> Hurry Hurry!! see if you can catch the falling knife!!!
> 
> 
> 
> 
> Click to expand...
> 
> 
> Since we are getting all Cramered  out here, one for you;Sdrl.....it's the future, price is setup in the middle of its 52 week frame, well managed co.
> 
> No, I am not gonna tell you, go look it up
Click to expand...


Mr. McGuire: I just want to say one word to you. Just one word.
Benjamin: Yes, sir.
Mr. McGuire: Are you listening?
Benjamin: Yes, I am.
Mr. McGuire: Plastics. 
Plastics!!


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## Toro

Trajan said:


> Zander said:
> 
> 
> 
> 
> 
> Valerie said:
> 
> 
> 
> Here is one I am watching like you read about...  *CLF*
> 
> Hit 52 week low today..earnings out tomorrow.
> 
> 
> 
> 
> 
> 
> Watch the volume and see if you can't get some at a bargain.
> 
> 
> 
> Hurry Hurry!! see if you can catch the falling knife!!!
> 
> 
> 
> 
> Click to expand...
> 
> 
> Since we are getting all Cramered  out here, one for you;Sdrl.....it's the future, price is setup in the middle of its 52 week frame, well managed co.
> 
> No, I am not gonna tell you, go look it up
Click to expand...


I met a guy a few weeks ago who used to work for Cramer.  He said that when he first started, he walked off the desk and Cramer almost ran into him as he was making his way back from the washroom.  Literally, "ran" into him.  Cramer literally ran from the desk to wherever he was going.  Cramer told the guy that "why would you waste time walking?"  After I was done talking to him, the guy ran - _ran_ - out of the room and back to his desk.


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## william the wie

Everyone is talking about deflation as if it were strange but what is Moore's Law but structural deflation in IT. What is Jonas Fisher's embedded capital but structural deflation in capital equipment. Productivity increases are deflation and productivity is increasing where does this no deflation meme come from?


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## Dante

Toro said:


> The other thread has turned into the usual mindless political hack garbage. This thread is to discuss the stock market crash without blaming everything on Republicans or Democrats by people who barely know the difference between a stock and livestock.
> 
> The UK has fallen 12% in 5 days. Switzerland has fallen 17% in 2 weeks.



Everything will be okay.


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## JimBowie1958

william the wie said:


> Everyone is talking about deflation as if it were strange but what is Moore's Law but structural deflation in IT. What is Jonas Fisher's embedded capital but structural deflation in capital equipment. Productivity increases are deflation and productivity is increasing where does this no deflation meme come from?



But since about 1910 we have seen new technologies spawn new industries quickly enough that there was always some new inefficient industry that needed loads of people that we supplied from our unemployed.

Today the dominant hiring in proffessional industries is in the form of H1-Bs and other suppressed wage labor sources. The primary bread earner that allows for disretionary income for most families is hit the hardest and so the consumer market shrinks. Our birth rate also contracts our consumer market in the long term, with a 25 year delay in effect.

We discuss these economic signals but the underlying problem runs much deeper into cultural and demographic origins.


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## mal

Toro said:


> The other thread has turned into the usual mindless political hack garbage. This thread is to discuss the stock market crash without blaming everything on Republicans or Democrats by people who barely know the difference between a stock and livestock.
> 
> The UK has fallen 12% in 5 days. Switzerland has fallen 17% in 2 weeks.




Happy August a year later... How's the Market?

I know Gold dropped from over 1,900 last fall to where is currently hovering since @ around 1,600...

Look for it to shit the bed like 83 in 13. 



peace...


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## Mad Scientist

Toro said:


> I've gotten to the point where I don't care a whole lot about what the market does over the short term.  It has become impossible to trade, given that so much of it is driven by obscure events in Europe as well as any rumours about QE round 427, or whatever the fuck it is now.  The only reason why the Dow popped 100 points in the last hour today is because of a WSJ article about yet more Fed intervention.  Frankly, I think its pathetic.  Monetary policy in this country has become a joke.  The only time the market has gone up is when QE has been in play.
> 
> What's absolutely amazing to me is how easy it would have been to make money in retrospect.  We are in the third year of the exact same playbook.  The economy is grinding to a halt in the summer so the Fed jumps to the rescue with (puke) QE.  The market rises in the Fall and early winter.  Come April and May, QE is on the verge of ending, news that Greece can't pay its bills, and the economy is nose-diving in the summer.  And so on.  This is the third year in a row when this has played out.  You are taught that _it can't be this fucking easy!_  Yet, it is!  As a citizen, I am disgusted by what is going on.  As a trader and investor, I can only adapt to my environment and take the opportunities the market provides.


Wait a minute! Are you admitting that the Stock Market is.... RIGGED? (Gasp!)


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## Toro

Good parable.

The parable of the ox - FT.com


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## iamwhatiseem

Toro said:


> Good parable.
> 
> The parable of the ox - FT.com



Nice one.


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