NoFate

5 Reasons Stocks Will Keep Falling

Guys - If everything is priced into the market and the market has a 6-9 month forward view, then why did it get cut in half in a week? The market is an emotional crack whore, not a crystal ball. It's favorite drug (credit and high leverage) got cut off a week ago and what we are seeing is DTs.

Further, Obama's increased likelihood of election didn't cause the crash! That is the most ridiculous thing I ever heard! His numbers went up because nobody believes McCain can fix it ...your causation is backwards.

In addition, I also disagree with the author on oil and the US$ for the same reasons as the first post.

Finally, it just stuns me how much disinformation is out there ...and what you all buy into sometimes! I am a Libertarian and am sick of being lied to by both parties and their media outlets.

How to Handle a Snap-Back Rally (If We Get One)

We are in a level 5 hurricane ...there is no investing right now. Investing in this environment is like starting construction on a new office building at the same time Katrina makes landfall.

Back to my trading...

Tuesday Was 4th Largest Point Gain in Dow's History

This seems to provide strong evidence we are in a bear market.

If I counted correctly, it appears only 1 out of the top 12 point gains were in a bull market.

10 out of 12 were during the 2000-2002 recession (and thus sucker rallies).

The final one was today. This would anecdotally indicate that there is a 10/11 probability (91%) we are in a bear market ...though I agree percent changes are better indicators than points.

The Federal Reserve, the Economy, and Stocks

Let Us Have Peace - SOLD TO YOU!

There are NO technical indications that we are at a bottom ...and using treasury yield ratios is pretty friggin arcane if you ask me. You might use that kind of information as a part of your analysis, but are you really willing to hang your entire thesis on that??

And sometimes when more people are bearish than usual it just means stocks are going down further. When people were bullish for 5 years it didn't mean we were peaking did it?

Guys - There are HUGE problems out there ...maybe the Fed will save the day, but we essentially still have the same set of problems we did 6-9 months ago ...except they have just gotten far worse. Nothing has been fixed at all. Why should I have faith that things aren't gonna get alot worse before they get better?

CNBC's Gasparino Joining the Plunge Protection Team?

This was done purposely to manipulate the market. The complete lack of real information and the timing are a dead give away. So where are the GD cops??

For those who think this is ok because you are on the right side of the trade remember that this won't always be the case.

Between the Ambac deal itself (which is fraud ...AAA? Really??) and all the market manipulation we are looking more and more like a banana republic.

Apparently George W. didn't F up everything in 7 years. The SEC, Federal Reserve, state regulators, investment bankers and rating agencies are hard at work finishing the job though.

The Federal Reserve, the Economy, and Stocks

It's called a business cycle Jeff ...get over it.

We are in a confirmed Bear market ...until we confirm a new Bull market we will be in a Bear market and we should act accordingly.

Finally, there are many relevant blogs out there ...the Big Picture, CR , Mish, Roubini, etc. Their arguments are usually MUCH stronger than "the Fed is working on it" or "the Fed said so", so no worries!

The Risk of Missing a Reentry When the Market Turns

I completely disagree ...there were many indicators back in 2002-03 that indicates a bottom:
- double bottom / higher low
- reverse death cross
- 200DMA turned back up
- broke the trend line
- probably a ton of other tech indicators I don't even know

I am far more scared of GETTING another 30% drop than LOSING the first 10% rise in the new bull market. This is particularly true since there is NO indication we are at a bottom yet.

Further, gold is unpredictable ...particularly now that it has gone parabolic! As a small percentage of a portfolio or a tightly monitored trade I think it is great, but the bottom can fall out quickly.

Finally, the only thing I find predictable in this market is that equities will drop further. The trend is your friend ...cash + QID, SDS, TWM, etc. until we confirm a bottom ...then go long again. This really shouldn't be all that complicated ...and if things do turn out like 2001-03 we still have a loooong way to fall yet.

Is the Worst Behind Us?

Zach - Pick a side dude ...long, short or cash ...what's it going to be?

You indicate that you don't think we are at a bottom ...but if investors want to go long that's ok too.

That's kind of like saying there is no water in the pool ...but if you REALLY want to go swimming then jump in!

Investors Get a Glimpse of the Future

Nobody has the right skill set for putting together a bailout plan.

Tell me who has $200billion laying around they want to flush down a toilet? Seriously ...if you are going to lose the money anyway why give it to someone else to lose for you??

Finally, I think your 1.25% cut raised got you about 40 points on the S&P in 8 days. I barely lost anything on my ultra shorts!

Guess we can head back down again now! :)

Selling Over? I'm Just Not Buying It.

Bush is going to sign into law a economic stimulus package that helps POOR PEOPLE! Admit it ...we got serious problems people!

Only Tax Cuts Will Work in the Long Run

Forgive me for being cynical, but I think it is much simpler than that. They are ALL simply pandering to their base. It's just that the Libs base would spend their money quicker than the Cons base.

In politics they all start with the answer they want (more tax cuts, food stamps, whatever...) and then they form an argument to support it.

Good economic policy should start with the problem and then search for the best solution.

It is a mistake to confuse politics and economics.

The Bear Turns Mildly Bullish

7 con't) US consumes 40% of World GDP. Our economy is $13 trillion ...India and China combined is around $2 trillion. They are sceeee-rewed without the US consumer.

The Bear Turns Mildly Bullish

Here are some facts:

1) The trend is your friend. The trend is down.

2) DEFLATION is coming. Bank margins are toast and credit is drying up quickly.

3) Loans are future earnings. MEW got spent allready and foreclosures destroy wealth ($2-3 trillion problem).

4) It doesn't matter how F-ing great America is ...recessions happen. Always have and always will.

5) Cash is KING! BUY LOW ...wait for a true bottom, don't catch a falling knife.

6) Equities can ALWAYS go lower. NASDAQ went from >5000 to 1200 in 3 years. Anyone want to argue this point.

7) The Decoupling theory is BS. Emerging Markets are going down also. They may go from 12% growth to 4 or 6% ...but you think this is not going to affect their stock price??

8) Stock valuations are based on FORWARD looking PEs. Wall Street still thinks US earnings are going to increase 14% in 2008 and this is what the E in the PE is based on. Goldman finally came out with -6% recently. How do you think this is going to affect things?

Any more questions?

Recession Could Be Boon for Stocks - WSJ

Yes, the market usually rebounds prior to recession end (though it did not last time!) ...however average peak to trough is around 20% in the S&P. This is hardly good news...

The Fear Is Palpable. Time To Buy.

The average peak to trough for the DOW during a recession since WWII has been around 10.5 months. If you think this is over you are smoking crack.

If you think there is a near term bottom soon I believe that is entirely possible. There should be at least a few sucker rallys on the way down. It won't go in a straight line.