fjd10595

Bear Market Rallies and Lessons of History

True, but with the consumer being an extremely large part our service economy (we make very little here), and with consumer credit contracting faster than at any time since the Great Depression (I believe) and with the consumer no longer being able to take money out of his house to the same degree as before, would this have the effect of contracting, or expanding PE's

'You made some very good points and did not deserve any thumbs down. It is true that low interest rates and low inflation support higher PE ratios'


On Nov 01 04:16 PM John Lounsbury wrote:

> E Nuff Said - - -
>
> You made some very good points and did not deserve any thumbs down.
> It is true that low interest rates and low inflation support higher
> PE ratios. I had a feature article published in 1996 (AAII Journal)
> that analyzed that very point. Dave Wrixon made a very good reply
> regarding the forward looking nature of the market that might have
> a more negative effect in the future (with respect to interest rates
> and inflation). No one mentioned it, but continued deflation is not,
> in general good for supporting higher PE ratios. You might say a
> little bit of medicine is a good thing but an overdose can kill you.
>
>
> untrusting - - -
>
> I frequently read John Hussman. I am guilty of not quoting him and
> giving links often enough.

'Dollar Up Stocks Down' Will Likely Change Soon

US markets are permanmently broken, despite what the market says. It is only a question of time when it manifests itself and we have 'blood in the streets', now, 10 years or 50. I do not want that outcome, but I know it is guaranteed to occur at some point. We continue to mortgage our children's future. We continue to pay for current programs by spending our children's money. What reforms have been made? Practically none. We have not broken up large banks, as we should have. Early in 2008 the markets said that US stocks were worth far, far more than they were.

Global Markets in Review: Reversal in Financial Markets

OK, just tell us the titles of the books you read on the subject. Keep handing the bill for the resources you use to your kids. And try sleeping at night.


On Nov 01 07:09 PM ebworthen wrote:

> Actually, the "experts" were predicting global cooling in the 1970's;
> they needed to find a new dog and pony to keep the money flowing.
>
>
> Stewardship yes - indentured servitude to GE and Utilities and the
> FED - NO!
>
> I believe you have good intentions and your heart is in the right
> place. Please consider the possibility that you are being duped when
> you are told that the sky is falling, with your good personage being
> used as the fulcrum to make very few a very lot of money.
>
> (Privatized gains - socialized losses - again)

Global Markets in Review: Reversal in Financial Markets

Sorry Joe,, some of us like to pay our bills- not hand them to our kids. I suggest you try reading some books on climate change at which point you will understand it is real. The price of carbon fuels are kept artifically low by government policies that fail to recognize the real costs to society.


On Nov 01 04:05 PM Joe Shareholder wrote:

> Are you in Obama's inner circle or just a moron? Carbon taxing spells
> doom to a US economy that is searching for itself right now and teetering
> on fragile footing. Green industries were created as profitable scams,
> not for profitable businesses as most of these companies cannot exist
> without strong gov subsidies from which many profit. Good book for
> everyone to read is "architects of ruin" by Peter Schweizer. It will
> open your mind about what is happening right now. Liberals, you want
> to talk about open-mindedness? Open your minds and read this book.
>

Bear Market Rallies and Lessons of History

You have to be kidding. We still have time to impliment proper policies? We don't have the political will for that. It means imparting pain to the public. The public doesn't want pain, it would rather enjoy whatever it can now, and pass the bill for the largess to the future, to our children. Politicians cater to that view, and lean on career public servants who are supposed to be insulated from public opinion to enforce what the public wants, or to enforce what their contributors want, i.e. the big banks. No, sadly there will be no change until there is "blood in the streets." The public would rather watch reality TV shows than to understand the grave issues facing the nation, and facing future generations.

Global Markets in Review: Reversal in Financial Markets

Right, and once government policies properly reflect the true costs of using carbon fuels, environmental damage, smog, fallouot of metals into our waterways, and much more, green fuels will suddenly be competitive. I don't believe in handing the bill for what I use to my kids, you know, the conservative way. Give us cheap gasoline now and force our kids pay the true cost of that usage when they inherit a damaged world.

On Nov 01 11:17 AM jay brebner wrote:

> carbon tax/cap-and-trade to raise revenues and pay off debt is an
> absolute policy proposal must in 2012 election. unfortunately it
> will not happen until then when contribution to GDP of green tech
> can be properly evaluated. the gold bugs will hate this but hyperinflation
> will equal armageddon for the US.

Global Markets in Review: Reversal in Financial Markets

LT PE ratios may be around 16 (according to your article), but is that really the point that this market should assume, with jobs continuing to disappear, and with consumer credit continuing to evaporate.

Extraordinary Popular Delusions and the Madness of Crowds

There was debt contraction then, and debt contraction now, but, now, there''s been a flood, worldwide, of currency introduction that will have dramatically different consequences than the '30's.

I have to admit that your comment was long, and thus I did not read it fully, but I say this: the liquidity that has been added cannot have lasting effect until it is loaned or put to work in the economy. You say the 'banks will soon loan to the vast majority still employed'. I guess so, assuming that they want the money. Is is possible that we are about to embark on a multi year, or decade, time frame in which we spend more and save less? I would expect deflation, or something near it, for an intermediate period of time.

On Oct 15 10:12 PM Tack wrote:

> Just two quick rebuttals:
>
> 1) The current situation is nothing --not even close-- like the '30's
> deflation. In the '30's the money supply, due to a tragic government
> mistake, contracted from 1929 to 1935, whereupon it began to exapnd
> again, but didn't even reach 1929 levels, again, until the end of
> 1938. This was the proximate cause of the deflation, and the government's
> lack of recognition of the mistake they made, followed by a rather
> tepid attempt to correct it, resulted in many years of deflation
> and stagnant economic circumstances.
>
> There was debt contraction then, and debt contraction now, but, now,
> there''s been a flood, worldwide, of currency introduction that will
> have dramatically different consequences than the '30's.
>
> The trouble is that in today's impatient world if we don't see the
> logical and inevitable effects of these actions in a few months or
> a year, we immediately conclude that 'this time it's different,"
> and formulate new theories. It's not different, and the consequences
> of a monetary flood will be the same as they've been in all other
> economic contractions, but possibly more so this time, given the
> unprecedented magnitude of the monetary largesse.
>
> 2) Everybody repeats over and over, ad nauseum, that all that new
> capital is tied up on bank balance sheets and isn't and won't be
> used for anything other than to counterbalance worthless paper, that,
> if it were marked own to true market values, would make many banks
> insolvent.
>
> There are two problems with this argument: a) the mark-to-market
> values that critics espouse were/are nothing more than the result
> of highly-manipulated and thinly-trade debt indices that clever shortsellers
> used, in conjunction with CDS positions, to decimate bank balance
> sheets and the market. They bear no relationship whatsoever to classical
> valuations based on actual cashflows being received and expected
> to be received by the actual note holders. That's why holders of
> debt assets re unwilling to dump them at nonsensical prices, thankfully,
> as this would result in the destruction of the financial system because
> fictitious losses, represented by "market" values, would suddenly
> be realized; b) for those that wish to track such information, the
> beleaguered debt indices that created all this angst have been steadily
> rising for several months, narrowing the gap between the genuine
> value of debt assets and the hysterical values previously created
> in the markets. Soon, this will result in the banks having excessive
> reserves that will start to be released back into earnings and will
> result in the banks being overcapitalized.
>
> When the foregoing happens, banks will start looking assiduously
> to put all that "dead" money to work. Coupled with increasing confidence
> by the vast majority of people employed, this will result in an increase
> in loan demand that will find amply funds to service it.
>
> The real risk for this economy, as with previous periods of monetary
> largesse, is that the government will fail to make timely reduction
> in the money supply until the demand-inflation cycle is well under
> way, so we'll get the same inflation that has followed most recessionary
> recoveries.

Global Markets in Review: Risky Assets Disconnect from Fundamentals

"It is still early days in this period, but 85% of U.S. companies have so far beaten earnings estimates. According to Bespoke, the current beat rate is well above any other quarter since at least 1998."

Gee, did Bespoke explain why we have these tremendous beats? Job cuts that will not be replicated infinitely into the future. What about revenue losses at all of these firms? What about unemployment continuing upward, and consumer credit continuing downward?

This article has too much information. I don't care for this style of writing. I would rather have something more focused. Give us what others are saying, in brief, and then give us your opinion, disagree or agree, and why.

Volcker Should Advocate VAT and Drop the Carbon Tax Recommendation

"there are plenty of scientists who don't believe carbon is the cause..."

Really? My obversation is the opposite of what you say. Most believe in the link between carbon and temperature. What do you define as "plenty". There are always contrary opinions. That is the way science works, there is a constant examination and reexamination of an issue. We understand that. The point is that the consensus is that there is a link. Do you take medicines, or know anyone who takes them? Do you doubt the science behind the use of medicines? Read some books.


On Oct 08 05:08 PM optionsgirl wrote:

> Even if carbon dioxide did cause climate change ( and there are plenty
> of scientists who believe it doesn't) why would you believe a system
> of trading carbon tax credits would "cure" anything? Don't you understand
> that this is still another tax, disguised as a solution to "climate
> change"? All John Q. Public gets out of the deal is higher costs
> for energy.

Volcker Should Advocate VAT and Drop the Carbon Tax Recommendation

"Cosmoclimatology and its accumulating evidence that solar activity and cosmic rays are the primary drivers of global temperature changes, not carbon-dioxide concentrations"

Are you joking, or should we just conclude that you don't know what you are talking about. Solar activity is not a primary driver. The science says that carbon dioxide concentration is a primary driver and is extremely well correlated with global temperatures. Try reading some books on climate change, instead of spreading misinformaton.

Thursday Outlook: Commodities, Global Markets

I see the same thing in the malls in Westchester County, NY. It is very quiet, a lot of sales on clothing, etc. As the dollar has dropped, stocks have risen- I guess because it helps our companies sell overseas. But in my opinion, with or without a weak dollar, the fundamentals don't support sustained earnings growth. I would say that when the dollar makes a rebound, stocks will correct.

Friday Roundup: Reality Bites Bulls

"Bulls were expecting the economic recovery to continue and gain more steam. However, the reality is an economic recovery is going to take some time. "

"Take some time?" Yeah, as in a few years, not months. Stock buyers are delusional. One thing that would concern me from a bear point of view is the VIX- if it rises too fast or too far, then I would tend to think that the market will stabilize.

Options Trader Monday Outlook: Microbe Mania

I am in Westchester County , NY, just above NYC. I went to a mall this weekend. There were a moderate number of people there (it was Saturday evening), but I noticed that most shoppers seemed to be just walking, I saw few bags in people's hands. I needed some clothes and I went into JC Penny. Much of the stuff was steeply discounted, and I was also struck by the lack of choice in merchandise. It seemed to me that there was not a lot on the floor. It is the same thing I've been noticing for a year now.

Thursday Outlook: Commodities, Global Markets

We understand that markets move in anticipation of earnings. But let me ask, do you expect that the higher earnings shown recently will be sustainable? On what basis? Continued cost and job cuts for the next few years? Increased consumer demand? But consumer credit has collapsed, as have home prices. People are being put out of work. The stock market is wrong at these levels, like it was wrong prior to last year's fall. I would look to the smarter bond investor for a truer reading of the economy.


On Sep 17 11:56 AM TLassen wrote:

> Dr. O
> with respect, let me point out that the markets move in anticipation
> of the revenue or earnings growth. Market is forward looking. Waiting
> for confirmation always leaves the investor behind. Now....granted,
> should those earnings not materialize as expected...then we all panic.
>
>
> "One of the greatest declines in history followed by one the greatest
> rallies in history. World wide" and this is worrisome because?..........
>
>
> On Sep 17 07:08 AM Dr. O wrote: