Current stock market (Nov. 2010) not reflecting reality

Gold $1407, Silver $29.20

Don't cry to me oh baby!

Your future's in an oblong box, yeah

Don't cry to me oh baby!

Shoulda seen it a comin' on....

Die die die my dollar

Don't utter a single word

Die die die my dollar

Just shut your pretty mouth

I'll be seeing you again

I'll be seeing you in hell!

Again, you own US stocks as a PART of your diversified portfolio, and to say so again, as Buffett says, no one ever got rich betting against the United States of America. Believe that.

Sagarin wrote:

Flagpole wrote:

This goes to my summation that there is a lot of cash on the sidelines. Glad to have that confirmed from the horse's mouth.

While mutual fund cash is extremely low and insider selling extremely high, it's certainly possible that the dumb money will flock back in at precisely the wrong time, which could propel us higher. And while INORGANIC growth may improve for a time, that's still no reason to own the US relative to other asset classes.

What am I still doing here? Not learning, that's for sure. Back to the Pat Porter thread.

The market has barely budged on the jobs report. Which tells you that the market wasn't surprised by the numbers. Which tells you that the market has priced in a weak economic environment and isn't out of touch with reality.

Flagpole wrote:

Just to prove I'm not just a market cheerleader, today the market is likely headed for a big fall (I haven't checked yet) because added jobs were much less than predicted, resulting in an increase in the unemployment rate. This is too bad. Long term, I'm still all in of course, but the short term fun has hit a bump today.

I could be wrong but didn't Goldman Sachs make a ton of money betting against the US in 2007?????

Flagpole wrote:

Again, you own US stocks as a PART of your diversified portfolio, and to say so again, as Buffett says, no one ever got rich betting against the United States of America. Believe that.

[/quote]

and didn't the fed save goldman sachs's tail in 2008/9 by providing emergency loans?

why all the histrionics about gold prices, which aren't even close to their inflation adjusted high?

SachUp wrote:

I could be wrong but didn't Goldman Sachs make a ton of money betting against the US in 2007?????

Flagpole wrote:

Again, you own US stocks as a PART of your diversified portfolio, and to say so again, as Buffett says, no one ever got rich betting against the United States of America. Believe that.

_________________

You can make money in a trade. What you describe was a trade. Short term, limited.

GS actually got rich by growing alongside the US economy. Which is what Buffett meant.

Agree with the earlier post about lack of true signs gold is in a bubble.

However IMHO, when sheeple such as Flagpole constantly quote Buffett, THAT is a better sign that stocks (and US-focused investements) are closer to a bubble than gold is.

"Obama is in favor of extending the Bush tax cuts for all but the highest earners."

You mean "...for all but the highest INCOME", right?

Methuselah wrote:

"Obama is in favor of extending the Bush tax cuts for all but the highest earners."

You mean "...for all but the highest INCOME", right?

Since the IRS taxes "earned income" what is the difference, other than perhaps your socialist demonization of "INCOME." The real wealthy don't need to work, and the inventors of socialism to leech off those who earn their living and constantly widen the gap between the haves and have nots.

Flagpole wrote:

Just to prove I'm not just a market cheerleader, today the market is likely headed for a big fall (I haven't checked yet) because added jobs were much less than predicted, resulting in an increase in the unemployment rate. This is too bad. Long term, I'm still all in of course, but the short term fun has hit a bump today.

Well, (and this should prove I do this when it is appropriate to do so) it appears I was wrong. Today the market went UP again instead of down, even with the dour jobs report today.

The Dow is now just 618.44 points shy of 12,000.

since you've posting the daily close of the dow for us the past few days, will you be posting the close on days when the dow is down as well? i guess we'll see how biased you are.

Flagpole wrote:

Flagpole wrote:

Just to prove I'm not just a market cheerleader, today the market is likely headed for a big fall (I haven't checked yet) because added jobs were much less than predicted, resulting in an increase in the unemployment rate. This is too bad. Long term, I'm still all in of course, but the short term fun has hit a bump today.

Well, (and this should prove I do this when it is appropriate to do so) it appears I was wrong. Today the market went UP again instead of down, even with the dour jobs report today.

The Dow is now just 618.44 points shy of 12,000.

Depends. I post when it is interesting on that given day. I have posted the big DECLINES in the past. Two days ago it was interesting because it went up a lot. One day ago it was interesting because it went up a lot again for the second day in a row. Today was interesting because the day began with bad jobs news and I said it would likely drop a lot, and it didn't...it went UP instead.Even after all the years I've been posting here, some of you just don't get me; and I don't think it's because I'm not clear..YOU decide why that is. I don't post to just show evidence of a position of mine (if that were so I wouldn't have posted this morning saying that this was bad news and the market would go down). I post if I find something interesting. I have no agenda. I have no need to be right (if so I would NEVER make a prediction).So, more to the point of your question, if the market goes down 5 points on Monday, then I probably won't mention it as it's not interesting (unless the day begins with bad news or a huge drop or something that makes a small 5 point drop interesting), but if it drops 200 points, I'll likely say something about it...but ONLY because I've predicted 12,000 Dow by end of 2010.Get it?

SachUp wrote:

since you've posting the daily close of the dow for us the past few days, will you be posting the close on days when the dow is down as well? i guess we'll see how biased you are.

Flagpole wrote:

Well, (and this should prove I do this when it is appropriate to do so) it appears I was wrong. Today the market went UP again instead of down, even with the dour jobs report today.

The Dow is now just 618.44 points shy of 12,000.

Flagpole wrote:

Depends. I post when it is interesting on that given day. I have posted the big DECLINES in the past. Two days ago it was interesting because it went up a lot. One day ago it was interesting because it went up a lot again for the second day in a row. Today was interesting because the day began with bad jobs news and I said it would likely drop a lot, and it didn't...it went UP instead.

Ever hear the story of two farmers who keep selling the same pig back and forth between eachother, for $5 more each time, until the pig dies, and the one farmer asks the other farmer who owned at the time, "Why'd you go and let that happen, we were becoming rich?"

All you're seeing is the Federal Reserve buying up the stock market with electronic dollars that devalue the currency. There are hardly any retail investors left, there have consequective outflows from mutual funds for like 30 weeks. It doesn't matter if the stock market goes up, if the dollar keeps going down even more, as it has.

Didn't see you posting results last month when the market had several big (100+ point) sell-offs.....I do get you. Everyone on here does. You are an attention w*ore. By the way...why exactly is it "interesting" if the market has two consecutive days of going up 1% or 2%? That's happened literally thousands of times beofe. March 2000 when the dow gained almost 10% in two days....that's interesting. A 3% move in two days...who cares?

Flagpole just got owned!!!!

SachUp wrote:

Didn't see you posting results last month when the market had several big (100+ point) sell-offs.....

I do get you. Everyone on here does. You are an attention w*ore.

By the way...why exactly is it "interesting" if the market has two consecutive days of going up 1% or 2%? That's happened literally thousands of times beofe. March 2000 when the dow gained almost 10% in two days....that's interesting. A 3% move in two days...who cares?

gtastic wrote:

well! just today the wsj proves at least part of my guess on why gold is rising in a low-inflation environment. The Chinese have been buying gold in huge quantities. Is that sustainable and do you want to buy alongside a huge autocratic government or play against them? I choose play against them.

gtastic,

Something else I found interesting as I learn more about gold is something John Paulson said about a year or so ago. This was the guy that made a ton shorting the housing mortgage-backed securites. Smart guy.

Anyway, he started a gold-fund in the last year or two and put a very large percentage of his own net worth in it. In interviews he was asked why, and why now (after it had gone up so much).

He replied that he anticipated HUGE inflation down the road, but NOT for another several years. However, his feeling was that by the time the huge inflation showed up, it would be next-to-impossible to get large quantities of physical gold (Billions of $ worth, in his case). So, he felt it was well worth it to be a few years early.

I'm interested to see if the guy turns out to be right again.

Question.....what exactly is the level that the Dow should be at? And how did you calculate that?

Flagpole wrote:

1) Consumer confidence is higher than it has been in 5 months with projections to get higher still.

2) Companies are reporting big earnings and have been for months.

3) Voters should be happy as they just put in place what they want (not started yet, but the market is forward looking).

4) Employment numbers are improving ever so slowly...but at least it's going in the right direction.

5) Manufacturing has grown for 15 straight months (will be 16 including November).

6) All projections are that this Holiday season is going to be huge.

A Dow that is continuing to hover at 11,000 is not reflecting reality. Even with some of the global concerns, this market is lower than it should be.

Doww Jonze wrote:

Question.....what exactly is the level that the Dow should be at? And how did you calculate that?

Net Present Value of all future dividend payments. Chapter 1 in a finance book. The value changes because expectations of future dividends change.

I know the answer wrote:

Doww Jonze wrote:

Question.....what exactly is the level that the Dow should be at? And how did you calculate that?

Net Present Value of all future dividend payments. Chapter 1 in a finance book. The value changes because expectations of future dividends change.

OK, now tell me, how many people/institutions buy/sell based on calculations of expected net present value of all future dividend payments.