Market Crash
-The market rally is built on shoddy fundamentals.
-25% of people on unemployment run out of benefits between Oct and Dec.
-Investors having growing concerns over short-term automated platforms (which account for a huge amount of volume).
-Savings rates are rising.
-Mid- to long-term, the foreign appetite for US debt is shrinking. Treasury auction yesterday poses some hope, but I don't see a long-term absorption - and the success of the auction hurt the dollar.
-Unemployment numbers released by the government are deceptive. When you take out unwarranted seasonal adjustments (eg - adding numbers to the auto sector in July) and consider utilization (33 hr work-week?), it's getting worse.
On some of my favorite sites (seekingalpha, zero hedge, realclearmarkets), I've seen more and more predictions of another imminent market crash (~35% decline or more, putting us in the high 5000 / low 6000 range, coupled with high volatility).
Do people think this rally is sustainable, and what position(s) would you take to express your short-, medium-, and long-term views?
No, Cramer and CNBC already
No, Cramer and CNBC already called the bottom, so obviously a decline in stocks/financial markets, or economic activity, is not possible. Kidding...though I don't neccessarily think a crash is coming.
5000 to 6000
5000 to 6000? I just cant see that happening. Hopefully I am right...
5000-6000... I hope that
5000-6000... I hope that happens, I invested in the initial dip in the beginning of the year, then continued to double down as financials continued falling precipitously... unfortunately I kept doubling down on margin, got slapped with margin calls and just cut my losses. I dont need anyone to tell me how insanely stupid this was... in any case... I could use a buying opportunity to recoup some of my losses.
Financial Modeling Training
Guide to Finance Interviews
Banking Resume
...
5000-6000... I hope that happens, I invested in the initial dip in the beginning of the year, then continued to double down as financials continued falling precipitously... unfortunately I kept doubling down on margin, got slapped with margin calls and just cut my losses. I dont need anyone to tell me how insanely stupid this was... in any case... I could use a buying opportunity to recoup some of my losses.
That was very stupid.
But seriously, I've been in cash for close to the past 6 weeks... despite the idiot technicians out there sprinkling chicken blood on their charts, it's really tough to make a case to stay in the market. Ignoring the inevitable trade4size post about some horseshit chart pattern or some Market Wizards quote, you've got to be an idiot to believe this can continue to X support/resistance level.
yesman - A lot of authors on Seeking Alpha are full of shit. Zero Hedge is ok, and I've never read realclearmarkets... PM if you want more details.
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I'm with you
5000-6000... I hope that happens, I invested in the initial dip in the beginning of the year, then continued to double down as financials continued falling precipitously... unfortunately I kept doubling down on margin, got slapped with margin calls and just cut my losses. I dont need anyone to tell me how insanely stupid this was... in any case... I could use a buying opportunity to recoup some of my losses.
I managed to take advantage of this run up with no margin calls, but I'd welcome another plunge to the 5,000-6,000 range. I'm definitely not excited about paying these prices.
Team Obama over the past 10 days or so have gotten really aggressive in the media declaring that the worst is over, and that their boss saved the world. My distaste for hubris is another reason I'd like to see a subsequent crash.
And I guess when it all comes down to it, I'm something of a moralist. I believe that when a market has been "saved" through wholesale moral hazard, it deserves to go back into the dumper.
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The WSO Guide to Understanding TARP
Ideating why do you hate
Ideating why do you hate technical analysis so much? I have noticed that you repeatedly reference it whenever your bashing me and I was just wondering why you are so opposed to it. You do realize that in in pretty much any highly liquid asset class is traded extensively off technicals right?
I still see Dow 10k S&P 1100. The bottom line is people are still chasing the rally and since earnings season has kicked off they are doing so at an accelerated pace.
"Oh the ladies ever tell you that you look like a fucking optical illusion" - Frank Slaughtery 25th Hour.
"Oh the ladies ever tell you that you look like a fucking optical illusion" - Frank Slaughtery 25th Hour.
...
...no need for horse-blood to make a case to be long stocks or anything else, here is the #1 argument in my book:
The money supply has been doubled in the last year. For many months, that money supply increase was offset by banks not taking any risk. Now banks are taking risk again and that money supply is starting to move...MS missed earnings last quarter and the CFO flat out told the WSJ that they werent going to get caught being to conservative again....that is the current mentality of banks. Amazingly, not even a year out from the precipice of doom, we are already back to the age of "can you top this" in terms of risk appetite. Doubling of the money supply + risk appetite = rising prices somewhere. Consumer prices aren't going up since nobody has a job to pay for anything, but that money is finding its way into financial assets. In such an enviornment, valuations and fundamentals may be meaningless.
...keep in mind this is just a money printing-induced rally that will probably once again end in tears, but that dosent mean it cant go longer and farther then any bear could anticipate.
...
Ideating why do you hate technical analysis so much? I have noticed that you repeatedly reference it whenever your bashing me and I was just wondering why you are so opposed to it. You do realize that in in pretty much any highly liquid asset class is traded extensively off technicals right?
I still see Dow 10k S&P 1100. The bottom line is people are still chasing the rally and since earnings season has kicked off they are doing so at an accelerated pace.
"Oh the ladies ever tell you that you look like a fucking optical illusion" - Frank Slaughtery 25th Hour.
Of course I'm not opposed to technicals - anyone who trades can't ignore them. But I get annoyed by people who use some bullshit charting techniques that have little basis in reality (i.e. moon cycles) or confuse luck with accuracy on other indicators (if it breaks the Bollinger it's going to trend unless it's a head fake in which case never mind). To be fair, that's a relatively small part of the trading population. But the much larger problem is people being either too stupid or lazy to evaluate fundamentals properly and end up relying on technicals as a crutch. Ultimately, you need both. The 100% fundamental guys are economists and the 100% technical guys are morons.
Financial Modeling Training
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Banking Resume
...
Damn you... I was sure this thing was going to burst in the next 1-2 months before I read your post. What's funny is I have the exact same theory about China (and commodities), I just didn't port it to our economy.
...no need for horse-blood to make a case to be long stocks or anything else, here is the #1 argument in my book:
The money supply has been doubled in the last year. For many months, that money supply increase was offset by banks not taking any risk. Now banks are taking risk again and that money supply is starting to move...MS missed earnings last quarter and the CFO flat out told the WSJ that they werent going to get caught being to conservative again....that is the current mentality of banks. Amazingly, not even a year out from the precipice of doom, we are already back to the age of "can you top this" in terms of risk appetite. Doubling of the money supply + risk appetite = rising prices somewhere. Consumer prices aren't going up since nobody has a job to pay for anything, but that money is finding its way into financial assets. In such an enviornment, valuations and fundamentals may be meaningless.
...keep in mind this is just a money printing-induced rally that will probably once again end in tears, but that dosent mean it cant go longer and farther then any bear could anticipate.
Financial Modeling Training
Guide to Finance Interviews
Banking Resume
how long?
...no need for horse-blood to make a case to be long stocks or anything else, here is the #1 argument in my book:
The money supply has been doubled in the last year. For many months, that money supply increase was offset by banks not taking any risk. Now banks are taking risk again and that money supply is starting to move...MS missed earnings last quarter and the CFO flat out told the WSJ that they werent going to get caught being to conservative again....that is the current mentality of banks. Amazingly, not even a year out from the precipice of doom, we are already back to the age of "can you top this" in terms of risk appetite. Doubling of the money supply + risk appetite = rising prices somewhere. Consumer prices aren't going up since nobody has a job to pay for anything, but that money is finding its way into financial assets. In such an enviornment, valuations and fundamentals may be meaningless.
...keep in mind this is just a money printing-induced rally that will probably once again end in tears, but that dosent mean it cant go longer and farther then any bear could anticipate.
So how long do you see it lasting?
Ideating I do rely primarily
Ideating I do rely primarily on technicals as far as my entry/exit but I get my ideas more off macro analysis. I limit my technicals to basic price action interpretation. For once I can say I agree that the 100% fundies/100% techicians are both bafoons. My trading is a hybrid of both. The problem with non professionals using fundmental analysis or information arb is that they have a much more limited access to timely information as to what is really driving the market. Its tough to know what the big players are driving the markets are looking for.
Unless your very well connected in who you talk to its tough to trade off the short term fundamentals simply because your always going to be a step behind the big boys. In the longer term I think its a more level playing field.
The little guy doesnt necessarily need to have good information to make money trading though. I truly believe its more about psychology/discipline/risk management than it is idea generation.
"Oh the ladies ever tell you that you look like a fucking optical illusion" - Frank Slaughtery 25th Hour.
"Oh the ladies ever tell you that you look like a fucking optical illusion" - Frank Slaughtery 25th Hour.
...
...i am very conflicted right now and change my mind frequently...i am not really sure how long its going to last. My point though is that in an enviornment where the money supply has doubled one must be respectful of the distorting effects that can have on prices and so even if u r right on the fundamentals the market could keep going higher. Fundamentals are really meaningless compared to the "technical" of supply of stocks vs. need for money to find returns in an enviornment of loose monetary policy. Friday notwithstanding, right now just about every asset that dosen't have a massive supply overhang (houses) is going up in price.
FT: Fundamentals are weak
http://www.ft.com/cms/s/0/2559e768-88f0-11de-b50f-...
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The WSO Guide to Understanding TARP
For 5,000-6,000
things would have to get markedly worse. While it's obviously possible, I think it's pretty unlikely.
I'm a dumbass and bought
I'm a dumbass and bought some PCS shares at $11.90 two weeks ago right before the approximate 30% decline of both PCS and LEAP. It's now around $8-$9 and I'm wondering if I should hold on to it or cut my losses before it goes down more. Any thoughts if you're familiar with the stock?
yesman... how much of skin
I pulled all my money out of
CompBanker
dollar cost averaging
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I'm making it up as I go along.
Testing lows
.
Hindsight 20/20
yes, growth is slowly
Not exactly perfect, I lost
The opinion of legends
Velocity of Money
I agree
Yesman why SPXU and not SDS?
"Oh the ladies ever tell you that you look like a fucking optical illusion" - Frank Slaughtery 25th Hour.
SPXU
nothing?
most people on this board
something...
This market is unbelievably
"Oh the ladies ever tell you that you look like a fucking optical illusion" - Frank Slaughtery 25th Hour.
...
Yeah man im excited too! "Oh
"Oh the ladies ever tell you that you look like a fucking optical illusion" - Frank Slaughtery 25th Hour.
.