Warm_Paw

The Dow: Ominous Parallels to the 1929-1930 Era

I couldn't finish the article.
It wasn't making sense to me.
Past performance is no indication of future performance.
I will say this, the truth about banks and AIG has been suspended.
As long as transparency is deferred, the market will chug higher.
But the truth will come out and then the picture won't be so rosy.
As for AIG, the only reason it's still trading is the Fed.
It's the Feds way of using tax dollars to insure the Credit Default Swaps. Is AIG still a company that earns money - NO.
At this point in time - with the banking system broking - I can only wonder how the DOW is around 9500?
It should be at 5000 and that's being generous. It's probably the influx of govt stimulus floating the market.
No one has a clue what earnings are anymore, if not suspended, earnings are being skewed by accounting changes.
Until the smoke and mirrors susbside, an investor is on a slippery slope putting their money in. No matter what you buy, should the truth surface, you will lose.

Markets Holding Steady, Volume Picks Up

CNBC is cheerleading a rally.
Someone should remind them of this weeks comment when markets head into the next crash.
A 3% increase in used home sales is no signal banks have rid themselves of distressed assets. They haven't dealt with the assets because marking to market would let everyone know where we really are.
Oil's going higher when storage capacity is overflowing.
Obama talks transparency while investors are sold a bill of goods while no one discusses exactly where the top ten banks are in ridding themselves of these toxic assets.
Some clown attempts to buffer higher unemployment numbers as a one time event due to car company layoffs. He's lost the point - it's even more signifgant unemployment numbers are on auto layoffs. Those layoffs aren't temporary.
Yes- one time event ... a final event.
Next week Govt bills are going to be sold in major fashion to pay for this rally. Those bills take investment money out of the market.
How many of those bills are being bought back by govt?
I'm aware mainstream America watches half hour sit coms and can't find their butts with both hands, but the real investment money on the sidelines is held by people with a little more sophistication.
They can withdraw that sideline rally money as quickly as pulling a rug out from under an investor.
This is a sucker's rally.
Little has been discussed of Morgan Stanley or Wells Fargo.
All is not sugar plum fairies and roses.
August brings the conclusion of AIG.
Will it be a paragraph relegated to page 7 bottom corner?
The worst part, money is to be made buying in with the suckers.
Question is, when is the right time to get out before that rug is pulled?

Surprise, Surprise, Surprise: Positive Economic News Everywhere

Hey - he's called "THE GOOD NEWS ECONOMIST"
He reports good news.
Give 'em a break.

The bad news economist is reporting reality.
"2-4-6-8!"
"BOY DID WE DEPRECIATE!"

This Advance Will Be Measured in Days, Not Months

My RIMM prediction was posted here on July 10 2009.
The article was :RIMM Proceed with caution.
It's July 17 and a miracle has occurred. RImm's gained $7 a share.
Was it the settlement of a court case where RIMM has agreed to pay $264 million? I could see how that would help share price...
What settlement, when you pay out $264 million, you didn't have a defense.

This Advance Will Be Measured in Days, Not Months

I agree with shorting from here on in.
I'd go as far as saying we're about to see March's lows after AIG reports in August. They should've blipped off the radar after losing what I believe was $700 + dollars a share.
I'd like to know if any of these banks have turned over any of their toxic assets and how long they are allowed to suspend marking them to market???
Phillip Davis had it right in his article "Here we go Again"
10 days ago RIMM was paying a premium of $7 a put at $65 for this strike date. Everyone claimed this was Bearish.
I knew it was bullish for whoever sold the put.
I also knew RIMM would be about $72 today for those puts to expire worthless.
We wonder how Goldman makes 10 billion in trading and 4 billion in actual banking? They have some very accurate traders at a time when markets are a roller coaster ride.
One can only wonder how events seem so well choreographed.

Wall Street Breakfast: Must-Know News

Bank earnings aren't being reported as they used to be.
Earnings are over positive to hype the economy.
Notice this crisis centers around toxic assets on bank balance sheets yet no one discusses the percentage of toxic assets unwound for each bank, or the amount of these assets left on bank balance sheets.
We have at least two more death spirals dealing with the unwinding of these assets. The public's obviously not to know that.
The public's to take the hit buying bank stocks so they can dump these mortgage backed securities.
The very idea citi or Goldman want to give larger pay to bank execs has me wonder why the tax payer should be on the hook to bail them out.
Let them fail. Greedy pigs should get slaughtered. As for throwing the economy into a tail spin, it's inevitable.
These banks need to go the way of the car companies.
The real challenge is bringing manufacturing back to America.
Jobless people don't pay taxes.
The few working people won't be able to shoulder the burden.
Of course we could raise the tax rates on bankers and right the countries woes.

The Coming Economic Collapse, Part 2

Good articles.
Obama has discussed manufacturing being offshored and has stated America will be where the technology resides. The flaw in that thinking is that idea generation does not allow the masses to pay their bills and the common person is not going to receive funding to stay home and generate ideas.
So what does the common person do without a job?
Besides starve....

Time for Investors to Act Against the Depressing Economic Outlook

There is a reason true capitalism must take some marbling with socialism.
Where once, America could work it's way out of a crisis like this, there is no work.
It's been offshored to India, Mexico and China.
Globalization is now dealing with questions everyone asked when it first began...
If workers in third world countries earn $2 a day, how will they purchase $40,000 SUV's?
If unionized wage earners are unemployed, who purchases the end product?
How long can the American public max out their credit cards without meaningful employment?
What does it mean when Walmart and the Dollar Stores are our only profitable enterprises?
Business owners enjoying profits deferred answering these kinds of questions.
Now we are hearing how awful protectionism is.
It's necessary to keep the last bastion of democratic freedom a superpower.
The new war is a financial cold war and Americans have been suckered into believing they should keep China employed so the elite few can stuff their overstuffed bank accounts.
China continues to suppress their dollar in their own protectionist way, to keep themselves growing.
Technology is making it so we should now be subsidized into a four day work week, but whatever production labor is req'd, should be done in America.
Employed Americans can pay their mortgages.
Subsidizing is socialism.
True Capitalism was fine when there weren't countries with slave labor producing competing products and dumping them on our markets.
But we're globalized now.
There may come a day when the standard of living of these third world countries allows us to sell them product, but by then our standard of living will have drastically fell as their standard of living rises up to meet it.
By then today's businessman will have gorged himself and have died of their second triple bypass.
There's real reason to be pessimistic.
No one's addressing the root cause of what is occurring.
All we know is the excesses have vapor locked the banks and the masses have helped exacerbate the situation by causing a run on the banks.
If the banks conducted themselves in such a way as to instill confidence, this situation wouldn't be so dire.
If Alan Greenspan hadn't become a mortgage broker and promulgated the use of Adjustable Rate Mortgages, over the security of having a fixed rate mortgage (Ask Suzy Orman) this country wouldn't be looking at a financial disaster that will take decades to correct.
How did the price of real estate compared to percentage of wage be allowed to balloon as it has?
People purchasing half million dollar homes on family incomes of $80000 a year or less. China can do it because they have second generation mortgages.
It's time for investors to bail before April shows them that after the insurance companies fail, the banks might as well fail along with them.What good is a claim if the insurance company can't pay it?
There's no sense GM surviving. No one wants their vehicles. Their short sightedness is giving them what they deserve.
Unionized workers better take their pay cuts and be thankful their employed. We'll be buying the same product from China regardless.We can't afford not to,
with our Dollar Store wages.
Do you want fries with that?

Dow Nears 50% Retracement; Tread Carefully

I think Nero would be fiddling right about now.
All of Wall St. and the great economic minds can't propose a solution that makes sense?
How did such a catastrophe happen without anyone having a clue?
Sure shakes the faith.
I've buried my gold and am growing food in the country.
I'd sooner spend it myself than give it to a broker to steal.

Speculating on the Future

Ironically it is the Republican's to deny the bailout package at a time Bush needs it most. This raises a flag with me. The McCain shows up to be the man of the hour and is told to not get involved. (The Lady protests too much methinks) Now McCain is coming up with a plan for Bush to alleviate this mess with the stroke of the pen. Is McCain going to single handedly get us out of the credit crunch only to take the election from Obama at this late stage?
If so, the bailout will be denied again on Thursday so hang on investors.
The stage is set for McCain to be the man in the eleventh hour.
Only it's so elementary school it's laudible.
And on a further note, it was the BBC to explain to America that if the FDIC rate was not increased from $100,000 to a larger amount there would be a run on the banks.
What are US financial officials doing for their salaries?
We should get them to read foreign news to find ideas for their think tanks!