T Nation

Wall Street Teeters

http://www.therealnews.com/t/index.php?option=com_content&task=view&id=31&Itemid=74&jumival=2355

uhh…

You might want to stay a little more up to date.

The market gained back 410 points today. The biggest single day gain in recent memory.

This is a bear market. The markets are erratic as hell because of panic sellers, opportunistic buyers, and the naked shorters.

[quote]rainjack wrote:
uhh…

You might want to stay a little more up to date.

The market gained back 410 points today. The biggest single day gain in recent memory.

This is a bear market. The markets are erratic as hell because of panic sellers, opportunistic buyers, and the naked shorters. [/quote]

I forget, but how much did the market lose that one day in 1987? And what was the DJIA at? People make a big deal out of this, but wasn’t the market at app 1/3-1/4 of what it was back then?

[quote]tom63 wrote:
rainjack wrote:
uhh…

You might want to stay a little more up to date.

The market gained back 410 points today. The biggest single day gain in recent memory.

This is a bear market. The markets are erratic as hell because of panic sellers, opportunistic buyers, and the naked shorters.

I forget, but how much did the market lose that one day in 1987? And what was the DJIA at? People make a big deal out of this, but wasn’t the market at app 1/3-1/4 of what it was back then?

[/quote]

It lost almost 25% on Black Monday. It went from 2247 to 1739 - 508 point drop.

So before the crash, it was about 1/5th of what it is today.

Well let’s make this a better debate:

What does everyone think of the proposed plan today by Bernanke today to possibly buy out all the bad debt?

Link:

http://online.wsj.com/article/SB122177442732653979.html

[quote]AssOnGrass wrote:
Well let’s make this a better debate:

What does everyone think of the proposed plan today by Bernanke today to possibly buy out all the bad debt?[/quote]

I think the government has to come out and be very clear in what it is trying to achieve by taking over failing companies and also what it intends to do with them once they have assumed control - most of these companies are failing for very good reasons and simply changing out the management team ain’t gonna do it - the taxpayer (effectively the new shareholders) have the right to know what ‘The Plan’ is and associated risks are.

The DJIA is up another 400 points today. Nasdaq and S&P are posting similar type numbers.

The biggest “crisis” right now is the inability of investors to invest for the long term and hedge themselves enough to ride out these bumps.

Everything else, with the exception of oil (which is readjusting, but is a problem for the US regardless), is just the market correcting itself. The sky isn’t falling, 2009 will likely see gains.

Don’t worry. I am sure the government will fix it.

[quote]tedro wrote:
The DJIA is up another 400 points today. Nasdaq and S&P are posting similar type numbers.

The biggest “crisis” right now is the inability of investors to invest for the long term and hedge themselves enough to ride out these bumps.

Everything else, with the exception of oil (which is readjusting, but is a problem for the US regardless), is just the market correcting itself. The sky isn’t falling, 2009 will likely see gains.[/quote]

I think the blanket ban on shorts is a bit too much. If the rules already on the books against naked shorts were enforced,that would stop a lot of the volatility in the market.

Shorting stocks is not a sin. Naked shorting should be punishable by jail time.

Oil still as about $30 (assuming $100/brl) to fall before you can say it is readjusting, IMO.

What’s a naked short?

[quote]PRCalDude wrote:
What’s a naked short?[/quote]

I hate wiki but this is a pretty good definition:

[quote]tedro wrote:
The DJIA is up another 400 points today. Nasdaq and S&P are posting similar type numbers.

The biggest “crisis” right now is the inability of investors to invest for the long term and hedge themselves enough to ride out these bumps.

Everything else, with the exception of oil (which is readjusting, but is a problem for the US regardless), is just the market correcting itself. The sky isn’t falling, 2009 will likely see gains.[/quote]

You are right, the sky isn’t falling, but, unfortunately, the stock market is. A clear downtrend is established and it would be foolish to invest for the long run until the down trend is broken. There is still plenty of room for these markets to drop further and there is still more bad news coming.

A market like this is suited only for short term trading, imo. These 400 point rallies are, in the words of John Hussman, “fast & furious and prone to failure”. If you want to play this market buy when new lows are established, then sell on these explosive rallies. That’s what I’m doing. I bought heavily the day before yesterday and I sold first thing this morning. I won’t buy again until I see fresh lows. It may be a few weeks or a few months but they are coming.

Do you guys know what is spurning this rally? I think the main thing is the ban on shorting financials. With the short sellers restricted to only being able to buy back the stocks they’ve shorted, that’s what they’re doing. They’re buying back and driving up the prices. This isn’t the type of rally that is likely to last.

http://bigcharts.marketwatch.com/quickchart/quickchart.asp?symb=spx&sid=0&o_symb=spx&freq=2&time=20

This chart clearly shows the S&P 500 can easily drop to 850 in a year or so. The current corporate problems seem to be much worse and widespread then they were when the tech bubble burst, so I wouldn’t be surprised if the market drops much further this time.

Side note; look how long the trend lines in the S&P 500 stay established. So far, a minimum of 3 years.

[quote]on edge wrote:
tedro wrote:
The DJIA is up another 400 points today. Nasdaq and S&P are posting similar type numbers.

The biggest “crisis” right now is the inability of investors to invest for the long term and hedge themselves enough to ride out these bumps.

Everything else, with the exception of oil (which is readjusting, but is a problem for the US regardless), is just the market correcting itself. The sky isn’t falling, 2009 will likely see gains.

You are right, the sky isn’t falling, but, unfortunately, the stock market is. A clear downtrend is established and it would be foolish to invest for the long run until the down trend is broken. There is still plenty of room for these markets to drop further and there is still more bad news coming.

A market like this is suited only for short term trading, imo. These 400 point rallies are, in the words of John Hussman, “fast & furious and prone to failure”. If you want to play this market buy when new lows are established, then sell on these explosive rallies. That’s what I’m doing. I bought heavily the day before yesterday and I sold first thing this morning. I won’t buy again until I see fresh lows. It may be a few weeks or a few months but they are coming.

Do you guys know what is spurning this rally? I think the main thing is the ban on shorting financials. With the short sellers restricted to only being able to buy back the stocks they’ve shorted, that’s what they’re doing. They’re buying back and driving up the prices. This isn’t the type of rally that is likely to last.

[/quote]

This week was the perfect time to dive in and take some deals. GE was trading at 22 on Monday, giving it a PE of less than 12. That is it’s lowest price in years. A person would be a fool to pass up a deal like that.

Pretty much all of the Dow 30 was a good buy at some point this week.

Look at the the company if you are playing long term. The charts are for day traders and swingers.

Put down the charts and read up on old Warren. He really makes a shit ton more sense in this kind of market than does the chart whores. This market is where value is exposed.

[quote]rainjack wrote:
on edge wrote:
tedro wrote:
The DJIA is up another 400 points today. Nasdaq and S&P are posting similar type numbers.

The biggest “crisis” right now is the inability of investors to invest for the long term and hedge themselves enough to ride out these bumps.

Everything else, with the exception of oil (which is readjusting, but is a problem for the US regardless), is just the market correcting itself. The sky isn’t falling, 2009 will likely see gains.

You are right, the sky isn’t falling, but, unfortunately, the stock market is. A clear downtrend is established and it would be foolish to invest for the long run until the down trend is broken. There is still plenty of room for these markets to drop further and there is still more bad news coming.

A market like this is suited only for short term trading, imo. These 400 point rallies are, in the words of John Hussman, “fast & furious and prone to failure”. If you want to play this market buy when new lows are established, then sell on these explosive rallies. That’s what I’m doing.

I bought heavily the day before yesterday and I sold first thing this morning. I won’t buy again until I see fresh lows. It may be a few weeks or a few months but they are coming.

Do you guys know what is spurning this rally? I think the main thing is the ban on shorting financials. With the short sellers restricted to only being able to buy back the stocks they’ve shorted, that’s what they’re doing. They’re buying back and driving up the prices. This isn’t the type of rally that is likely to last.

This week was the perfect time to dive in and take some deals. GE was trading at 22 on Monday, giving it a PE of less than 12. That is it’s lowest price in years. A person would be a fool to pass up a deal like that.

Pretty much all of the Dow 30 was a good buy at some point this week.

Look at the the company if you are playing long term. The charts are for day traders and swingers.

Put down the charts and read up on old Warren. He really makes a shit ton more sense in this kind of market than does the chart whores. This market is where value is exposed.

[/quote]

I’m sure there are plenty of stocks that will never go lower than they were two days ago. Unfortunately, I don’t have the time to research them or the know how to compete with the professionals at it.

Fortunately, I can make a quick glance at the chart of the S&P 500 and I know where the market is going. If it should make history and turn around faster than it ever has before, I can be back in with only a little lost opportunity. My methods are proven.

The last year I didn’t beat the market was 2003 and that was only because I got hammered at work and wasn’t checking the markets. When they turned I got caught short and missed my exit points.

This year I’m barely in the negative in tax deferred accounts and I’m on the plus side in taxable accounts. The general markets are all down 15-20%. This is with minimal effort. Only at extreme times like this I spend a lot of time looking at charts and my accounts. I will go weeks with out looking during boring times.

[quote]on edge wrote:
rainjack wrote:
on edge wrote:
tedro wrote:
The DJIA is up another 400 points today. Nasdaq and S&P are posting similar type numbers.

The biggest “crisis” right now is the inability of investors to invest for the long term and hedge themselves enough to ride out these bumps.

Everything else, with the exception of oil (which is readjusting, but is a problem for the US regardless), is just the market correcting itself. The sky isn’t falling, 2009 will likely see gains.

You are right, the sky isn’t falling, but, unfortunately, the stock market is. A clear downtrend is established and it would be foolish to invest for the long run until the down trend is broken. There is still plenty of room for these markets to drop further and there is still more bad news coming.

A market like this is suited only for short term trading, imo. These 400 point rallies are, in the words of John Hussman, “fast & furious and prone to failure”.

If you want to play this market buy when new lows are established, then sell on these explosive rallies. That’s what I’m doing. I bought heavily the day before yesterday and I sold first thing this morning. I won’t buy again until I see fresh lows. It may be a few weeks or a few months but they are coming.

Do you guys know what is spurning this rally? I think the main thing is the ban on shorting financials. With the short sellers restricted to only being able to buy back the stocks they’ve shorted, that’s what they’re doing. They’re buying back and driving up the prices. This isn’t the type of rally that is likely to last.

This week was the perfect time to dive in and take some deals. GE was trading at 22 on Monday, giving it a PE of less than 12. That is it’s lowest price in years. A person would be a fool to pass up a deal like that.

Pretty much all of the Dow 30 was a good buy at some point this week.

Look at the the company if you are playing long term. The charts are for day traders and swingers.

Put down the charts and read up on old Warren. He really makes a shit ton more sense in this kind of market than does the chart whores. This market is where value is exposed.

I’m sure there are plenty of stocks that will never go lower than they were two days ago. Unfortunately, I don’t have the time to research them or the know how to compete with the professionals at it.

Fortunately, I can make a quick glance at the chart of the S&P 500 and I know where the market is going. If it should make history and turn around faster than it ever has before, I can be back in with only a little lost opportunity.

My methods are proven. The last year I didn’t beat the market was 2003 and that was only because I got hammered at work and wasn’t checking the markets. When they turned I got caught short and missed my exit points.

This year I’m barely in the negative in tax deferred accounts and I’m on the plus side in taxable accounts. The general markets are all down 15-20%. This is with minimal effort. Only at extreme times like this I spend a lot of time looking at charts and my accounts. I will go weeks with out looking during boring times.[/quote]

With the fed coming in and bailing out everyone who has lost a dime, I don’t know how accurate your graphs are going to be in the future.

I expect another down turn next week when it is realized that the dipshits in DC aren’t going to do anything with the bailout proposals put to them by the Fed until after the elections.

We’ll see. I’m glad you have a system. It’s not the system I use, but I guess we are playing different positions. The market has lost 20% this year, but I am down only 1%. In any normal year, I would probably hang my head - but only losing 1% is like winning this year.

[quote]rainjack wrote:
tom63 wrote:
rainjack wrote:
uhh…

You might want to stay a little more up to date.

The market gained back 410 points today. The biggest single day gain in recent memory.

This is a bear market. The markets are erratic as hell because of panic sellers, opportunistic buyers, and the naked shorters.

I forget, but how much did the market lose that one day in 1987? And what was the DJIA at? People make a big deal out of this, but wasn’t the market at app 1/3-1/4 of what it was back then?

It lost almost 25% on Black Monday. It went from 2247 to 1739 - 508 point drop.

So before the crash, it was about 1/5th of what it is today.

[/quote]

And while a 5% or so downturn isn’t good, I get very irritated when it is reported with such horror, as if nothing was ever this bad.

[quote]AssOnGrass wrote:
Well let’s make this a better debate:

What does everyone think of the proposed plan today by Bernanke today to possibly buy out all the bad debt?[/quote]

Bernanke will buy up all the bad debt, get it in one place and then trash the dollar. He’ll have no choice.

The Fannie Mae / Freddie Mac bailouts effectively doubled the national debt. Now he’s going to add more? Who’s going to bail out the entire United States?

One of these days we’ll wake up to an announcement that the Fed has declared the dollar worth 50 cents, or less, effectively cutting the debt in half. That’s how fiat currency works. Of course, you can work with these guys if inflation bothers you:

As much as I like seeing the stock market soaring, you can’t help but say “who cares”, knowing the cluster fuck our government has gotten us into with the bailouts. Make 10% profit on your “equities”, while your grand children pay back billions? It’s like a pretty face on an obese woman.