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Some argue that there’s plenty of cash on the sidelines and there is - some $3 trillion to be exact. With the markets oversold, that’s a lot of buying power. Markets are forward-looking and investors aren’t seeing any reason on the horizon yet to assume greater risk-taking. When they do they’ll start buying but be careful of bear market rallies that are just flashes in the pan.

Capitulation? Well, if one measure is high traffic and questions we receive from the public, especially financial advisors, we must be getting close. It makes sense, doesn’t it? When times are good investors and advisors sit back confident in their own well-planned portfolio structures and performance. Such is not one of those times.

This blog is truncated as I must go to the dentist on an emergency visit…..ugh!

Have a pleasant day.

Disclaimer: Among other issues the ETF Digest maintains long or short positions in: SDS, QID, SIJ, SMN, SCC, SRS, XLY, IYR, SDP, XLU, GLD and DGP.

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Comments
10
  •  
    Blaming the government and mortgage lenders for the current financial meltdown, is akin to blaming McDonalds or the candy aisle at Wal*Mart for making us fat. Yes they offer the product for sale, but ultimately we have the choice of whether or not to buy it.

    With the exception of those families who truly faced financial hardships beyond their control (medical emergencies, jobloss, etc.), a significant number of American Families willingly positioned themselves within a paycheck or two of bankruptcy due to their own greed.
    2008 Oct 08 05:29 AM Reply
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    3 Trillion is a lot of money to be out of this market! I hope that some of it begins moving back in soon. I have 20+ years before retirement, but I feel bad for those who are (or will be retiring soon)
    2008 Oct 08 05:31 AM Reply
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    I dont think the govt will actually purchase stocks to stop the slide -but it wouldnt surprise me if they closed markets at this point while they fix some seriously screwed up fundamentals - at the same time closing banks across the nation and limiting ATM withdrawals -
    If they do it they will load the deck for a rally when the market reopens
    2008 Oct 08 06:59 AM Reply
  •  
    Mr g,

    That wouldn't be a bad idea at all. Very similar to what they did after 9/11.

    Intervention of some sort is inevitable.
    2008 Oct 08 07:11 AM Reply
  •  
    The Rome is burning ...
    2008 Oct 08 07:12 AM Reply
  •  
    Oh, please! W. Buffet would take all those nice looking charts, shuffle them, glued them end-to-end, turn the resulting super-chart upside down, and see that it was just as predictive as any of them or the whole lot of them or the flip of a fair coin. Its no wonder we have bubbles.
    2008 Oct 09 01:46 AM Reply
  •  
    Vancan, so why even bother to post or read the charts if you don't believe it has any merit or value in the first place? What a waste of your time and this space.
    2008 Oct 09 11:27 AM Reply
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    Trader Vic:

    Because if it is possible that technical analysis is part of the reason we have bubbles which are terribly disruptive to our economy and our lives, then I am going to say so.

    But how did I get to this post and hundreds of others like it? I am forced to read this stuff to know what the tech herd is thinking, because I am forced to play-the-players as a bubble inflates and again when it deflates. I have to do the same thing with the shorts. Figuring out which rumor is true and which is not takes time. (Who knows maybe their rummers will bring down another bank today. Great.) I hate playing-the-players because I should be working full time doing bottom-up research. But I can not do that. It would be ruinous as a bubble deflates to concentrate on a company's value. So once in a while I say so. You know. Free speech.


    2008 Oct 09 03:03 PM Reply
  •  
    "You are FORCED TO READ THIS STUFF TO KNOW WHAT THE TECH HERD IS THINKING?
    I hate playing-the-players because I should be working full time doing bottom-up research. But I can not do that."

    Vancan: Take your meds. Get back to your bottom up research and stop this pathetic drivel.
    2008 Oct 09 10:18 PM Reply
  •  
    Hey Ben Dinsmore...

    Why do you feel sorry for folks who are already in retirement? We don't have to sweat a paycheck like you do. Most of us have executed our plan with sufficient income and safely invested nesteggs so we don't take big risks in equities or commodities like folks your age do. I'm sleeping very well the last couple of weeks.

    However, I do agree with your feeling for those who are (were) getting close to retiring. Their schedule will probably be delayed some.
    2008 Oct 10 03:24 AM Reply