Not me.
Grow up junior.
Not me.
Grow up junior.
agip,
Margin debt was a problem in the Tech Bubble. Wall Street and investors were burned and it went out of vogue in the Housing Bubble. It has been resurrected in a new form the "portfolio loan." Discount the problem if you wish, but another sign this period is not different.
GOI aka Igy
Ghost of Igloi wrote:
agip,
Margin debt was a problem in the Tech Bubble. Wall Street and investors were burned and it went out of vogue in the Housing Bubble. It has been resurrected in a new form the "portfolio loan." Discount the problem if you wish, but another sign this period is not different.
GOI aka Igy
yeah I agree, I sholdn't have been so flip. I'm that guy who just missed dying in a car crash so I'm a little drunk on life. Amazing times.
there's nothing unusual about a 14% correction, but the speed of that thing was shocking. And that it had so little to do with the american economy, which is accelerating, apparently.
ah well one of the things that I like about the markets is that it is always something new.
agip,
It looks like we are entering a new market phase either way. Rates will go up and China is shifting away from an export economy. We'll see.
GOI aka Igy
Ghost of Igloi wrote:
POTO>0,
Earlier in the week were you thinking "I am going to lose this bet sooner than I thought."
Igy
I have never thought I would lose the bet.
mellon wrote:
Who's handle do you think got stolen?
This is the one and only Mellon! You know, the guy who predicted there would be no correction. Do you really think anyone else would try and take credit for that?
Why do you think I'm asking others for the recovery prediction. I'm sure not going to make it.
I am anxious to here everybody come out of the woodwork claiming to have timed the market and are making a killing now.
I timed this market perfectly and I am TOTALLY making a killing now.
POTO>0,
No sense of doubt? OK. We'll see how your confidence holds over the coming weeks and months.
Igy
The Dow is currently above where it closed last Friday. And that was before Monday's big drop. The lowest it got was 15,370 which is a long way from 13,000. This may not be a bull market, but it's certainly not a bear either. Why wouldn't I be confident?
and the US finished the week higher than it started. By a hair, but I'll take it.
with an amazing 6.5% swing from top to bottom.
US stocks down 1.9% for the year.
Maserati, POTO>0 and agip,
I sold half my shorts last week and I hope to add to them on a market rally. My best guess is that the downward trend continues. Think of the Chinese market, went down, rallied up, and dropped further. I am afraid this trend will be followed by our domestic market.
Have a good weekend.
Igy
Chinese Growth or lack thereof:
Ghost of Igloi wrote:
EM Fund Flows:
http://www.bloomberg.com/news/articles/2015-08-27/money-pours-out-of-emerging-markets-at-rate-unseen-since-lehman
money flooding out of EM funds is bullish, right? I think in a contrarian sense you have to go against the dumb money panicking.
Goldman-Sachs has gone...
FROM
SHORT US Dollar
LONG commodities
LONG BRICS (Brazil, Russia, India, China, South Africa)
TO
LONG US Dollar
SHORT commodities
SHORT BRICS
I, of course, was long USDX from early 2012 until earlier this year and now out of that. Otherwise, I wouldn't argue with Goldman (the only firm I follow on twitter, not because they have an ounce on integrity, but because they are right a lot). I do NOT have an account with Goldman; I only listen to them.
agip,
Yes, the conventional view is that funds are departing falling interest rate to rising interest rate environment, whichbwould be good for US stocks. But conventional thought was a lower interest rates were a boon to US stocks. You can have it both ways I guess. Always Bullish, up and away. I suspect there is a more ominous cause and effect.
Igy
There is that 4 letter word RISK that I think China has brought back into peoples' vocabularies. Those that sold into the various declines lost a pile of money, and they should want safer harbors now.
coach d,
Agreed. The pain has been minimal so far, with most investors still predominantly positive over the last couple of years. However, I have a belief that investors will be encouraged to buy on these dips with the general trend to continue down. At some point the buy-on-the-dip strategy will no longer be viewed as a safe and effective strategy. The buyers will decline both from the institutional and retail side. That is how we get to 13,000 Dow or lower.
Igy
You can get to 10000-13000 on the Dow in two quite different ways:
(1) A "normal" correction of 20-30% from somewhere near where the top from this year is;
(2) A blowoff top taking the market to 22,000 to 25,000 over 2 years, then a 50% collapse like 2000.
Why it really might be different this time.... As I've said before, a lot of individuals don't like these 50% collapses and have pulled $1-2 trillion out of equity funds, at least at one point a couple of years ago. These are the exact people that push the market to extreme highs (and then don't sell and ride the market all the way to the bottom). If that money really doesn't come back to equities, then the ammunition to produce a 2000 style top might not be there.
Now, considering that I'm a trend follower, I really prefer the extreme highs followed by a collapse, since I can ride the trend both ways, but we'll see. I do see Goldman talking about liquidity problems in the bond market, and if individuals feel they need to move back that money they moved into bonds from equities in 2002-2009, that might be how we get another massive top.
coach d,
I am open to tha possibilities you outlined. Since I am more fundamentally oriented I see valuation in the normal range at the 10,000-13,000 Dow level. That said, if we get that low we will probably over correct under 9,000. I believe the blow off top scenario is less likely because the market is experiencing divergence in performance between sectors and indices. One could point to the fall of 2011 where the market dipped only to extend higher. If I recall correctly the performance of the two periods was different in time and trend. The market weakness of late seems more structural and signifying a directional change downward.
Igy