2008: Ten Unforgettable Days 15 comments
-
Font Size:
-
Print
- TweetThis
Seeking Alpha's realtime Market Currents blog offers a unique window into the events and opinions that shape Wall Street - as they happen.
2008, a year many would rather forget, will more likely be seared in our memories for a long time. Use the links below to see how 10 of the year's most unforgettable days unfolded, through the eyes of Market Currents:
July 14: IndyMac is seized.
Sept. 8: Fannie and Freddie collapse.
Sept. 15: Lehman bankrupts. AIG gets bailed out. BofA buys Merrill.
Sept. 17: Reserve Primary breaks the buck.
Sept. 22: Bye bye I-banks.
Sept. 25: JPMorgan buys WaMu.
Nov. 5: Obama.
Dec. 12: Madoff.
Dec. 16: 0% interest.
Dec. 19: Automakers get their bailout.
Update: Readers chime in with some great suggestions:
March 17: Bear Stearns goes. The end begins.
Oct. 9-10: Meltdown.
Nov. 20: Markets hit (interim?) bottom.
Which days stick out in your mind? What are the events you can't seem to shake? What do you like about Market Currents? How can we improve it? Speak up in the comments.
Related Articles
|
Find People on SA
-
The Seeking Alpha 100
See allThe top 100 stock
market authors
selected for publication
Seeking Alpha 100 » -
Fastest Climbers
Authors with the largestSee all
increase in followers
in the last 7 days
Fastest Climbers » -
Top Commenters
Top commenters,See all
as ranked by their peers
Top Commenters » -
Top Instabloggers
The 100 most activeSee all
Instabloggers.
Top Instabloggers » -
Top StockTalkers
TopSee all
StockTalkers.
Top StockTalkers »
This article has 15 comments:
I'd add the March 17th collapse of Bear Stearns on your list. IMHO, this marked a turning point from in the public's understanding of just how bad the deleveraging process was...and just how very dishonest the I-banks were to their shareholders.
the great depression II was no longer impossible.
A depression is still on the table as long as unemployment continues to worsen.
The most memorable experience of 2008: (besides an American olymipic athlete winning more gold medals than anyone in history) would have to be the government sell out of taxpayers..... the TARP, and the autobailout that the taxpayers are paying for. It just proves to us that our own government could care less what happens to the taxpayer in America
thats pretty much it.
I love SA.com!
On Jan 01 03:10 PM Lawrence Schnurmacher wrote:
> need to add... Bank of America rescues CountryWide Financial, Bank
> of England rescues Northern Rock, Treasury rescues CitiGroup...include
> one of the dates it injected capital, FED announces various debt
> facilities to rescue banks, Goldman Sachs & Morgan Stanley rescue
> (they convert to commercial banks...investment banks no longer exist),
> $700billion bailout bill fails in congress, Iceland goes bankrupt,
> exact dates hard to remember....its all a blurr.
1. Microsoft Proposes Acquisition of Yahoo! for $31 per Share
2. Apple Announces Its Last Year at Macworld
3. Google Chrome, Google's Browser Project
4. To Our Developers (from Apple)
5. Google Is Taking Questions (Spoken, via iPhone)
6. Google to buy Valve (turned out to be incorrect)
7. Music Industry to Abandon Mass Suits
8. Google, Microsoft Said To Be Preparing Bids For Digg
9. Introducing Windows 7
10. iPhone 3G Launch Date Confirmed
The remarkable thing about the TechMeme list is how little impact most of those stories had on the overall stock market or the price of individual securities. The exceptions were the Microsoft bid for Yahoo, and rumors of Steve Jobs' declining health, perhaps behind Apple's decision to end Macworld.
This highlights the fact that tech was almost irrelevant to the overall market this year. The key market drivers, as we know, were the credit crunch, the implosion of the banks, the continued decline in the housing market, the bailout and the end of the commodities boom.
But perhaps the lack of stock market impact of 8 of the 10 top TechMeme stories also suggests that those stories weren't objectively important at all, because the stock market put no discernible value on the news. Which suggests that the attention given to many tech news stories and the blogs that cover them is perhaps exaggerated.
When times are not good, tech is the first to get cut, usually resulting in a swift, jolting decline in tech equities. This has played true this year. All of these stories you cite rely on good markets - when markets are bad, all the chips suddenly disappear from the table. That explains your lack of correlation.
On Jan 04 07:54 AM Hedged In wrote:
> It's fascinating to compare this list to TechMeme's "Top 10 objectively
> biggest tech stories of 2008" (news.techmeme.com/0812...).
> They were:
>
> 1. Microsoft Proposes Acquisition of Yahoo! for $31 per Share
> 2. Apple Announces Its Last Year at Macworld
> 3. Google Chrome, Google's Browser Project
> 4. To Our Developers (from Apple)
> 5. Google Is Taking Questions (Spoken, via iPhone)
> 6. Google to buy Valve (turned out to be incorrect)
> 7. Music Industry to Abandon Mass Suits
> 8. Google, Microsoft Said To Be Preparing Bids For Digg
> 9. Introducing Windows 7
> 10. iPhone 3G Launch Date Confirmed
>
> The remarkable thing about the TechMeme list is how little impact
> most of those stories had on the overall stock market or the price
> of individual securities. The exceptions were the Microsoft bid for
> Yahoo, and rumors of Steve Jobs' declining health, perhaps behind
> Apple's decision to end Macworld.
>
> This highlights the fact that tech was almost irrelevant to the overall
> market this year. The key market drivers, as we know, were the credit
> crunch, the implosion of the banks, the continued decline in the
> housing market, the bailout and the end of the commodities boom.
>
>
> But perhaps the lack of stock market impact of 8 of the 10 top TechMeme
> stories also suggests that those stories weren't objectively important
> at all, because the the market put no discernible value on the news.
> Which calls into question the hype around many tech news stories
> and the blogs that cover them.
Tech only under-performed the S&P 500 by a few percentage points over the last 12 months (finance.yahoo.com/q/bc...). While it's intuitively clear that capex gets cut in a weak economy and tech is highly leveraged to capex budgets, I wonder if there's any hard data to support the claim that tech profits are unusually leveraged to the economy.
My sense is that most of these stories weren't truly impactful, even if the economy had been stronger.
On Jan 05 02:01 AM Ricard wrote:
> Tech suffers from any market downturn because they tend to be a "derivative
> industry" - when markets are good, companies invest in tech, and
> tech makes outsized profits during this time.
>
> When times are not good, tech is the first to get cut, usually resulting
> in a swift, jolting decline in tech equities. This has played true
> this year. All of these stories you cite rely on good markets -
> when markets are bad, all the chips suddenly disappear from the table.
> That explains your lack of correlation.
About hard data, I'd point to fat tech operating margins. They have large R&D budgets, which they have to sustain during downturns (large fixed costs). However, when things pick up, those margins lead to huge gains that make those R&D commitments bear fruit. It's kinda like bio-tech in that sense, but the research bears cumulative benefits, and are thus (to me at least) more predictable and sustainable.
You're probably right about those stories. But, when times are good, even small shifts in revenue can lead to large gains in a company's earnings report, due to the above argument.
Cheers, happy investing.
On Jan 05 12:38 PM Hedged In wrote:
> Ricard, interesting point. Thank you.
>
> Tech only under-performed the S&P 500 by a few percentage points
> over the last 12 months (finance.yahoo.com/q/bc...;s=SPY&l=on&am...
> While it's intuitively clear that capex gets cut in a weak economy
> and tech is highly leveraged to capex budgets, I wonder if there's
> any hard data to support the claim that tech profits are unusually
> leveraged to the economy.
>
> My sense is that most of these stories weren't truly impactful, even
> if the economy had been stronger.
>
> On Jan 05 02:01 AM Ricard wrote:
CIEN for instance, is priced at net cash, or half its gross cash account. It's priced that way today because it's fallen nearly 90% from its high. I just bought this one a month ago, after watching it for years.