icandoitdon

U.S. Equities Still Overvalued - U.K. Report

when you can tell everyone with a 95% confidence interval what the "e" is going to be, your judgment that "equities are undervalued" might have some value beyond that of a baseless opinion. as for the historical average of forward p/e, what's that got to do with anything? p/e relationships vary greatly from one year to the next. they are one of many theoretical valuation measures, utterly useless in determining short term (1 year or less) price movements that are based on the dual emotions of fear and greed.

On Mar 26 11:40 PM Cetin Hakimoglu wrote:

> Boo hoo hoo. Market keeps surging anyway. Equities are undervalued,
> actually. The S&P has a forward PE of only 13 while the historical
> average is over 18.

Cheerleading for an 0-9 Team To Go 1-9

that's 16 years of waiting on the nikki...not 26.

i'll say this....the risk/reward ratio of stocks today is a hell of a lot better than it was one year ago and with short t bill rates pushing zero there isn't much of an alternative to stocks. as for picking the bottom, you don't need to do it to make a hell of a lot of money when the turn comes. for those who argue that it won't turn....history is against you. i've been bearish a long time but 've started to buy selectively with relatively small positions in stocks that have good finances that i think have a long term future. and i plan to keep doing so...particularly on those severe downdrafts that will likely be recurring in coming months.

John Hussman: The Market Is Not in Uncharted Territory

if "this sucker's going down" everyone is toast. you included, my friend.

Cheapest Valuations in Decades Will Trump Panic Selling

got that, everybody?

Getting Past the Panic

get real.

the aftermath of a panic is generally not a reversal in confidence and the beginning of a new bull market. confidence hasn't simply eroded...it has been shattered. great damage has been done and we are still a badly overlevereged country. government's hoping that we can resume business as usual as a result of this $700 billion capital infusion is a fantasy with little to support it than the hopes and wishes of those who have been wrong every step of the way through this bear market.

yes, look for a spike if the bill is approved but i suspect it will be short lived. once it becomes apparent that the medicine is not curing the disease the real trouble begins.

as for warren buffet's expression of "confidence" by investing in GS and GE, i'd invest every nickel i had if i got the deal he got.

and let me make another observation. isn't it strange that buffet coughs up just $5 billion and is able to extract virtually usurious terms from companies like GS and GE but the government...with virtually umlimited funds....has to buy worthless securities as a means of keeping these institutions solvent. what's wrong with this picture? why can't the fed's simply say "we'll give you all the money you want" (provided there is a real business there) as long as you give us...the taxpayer...preferred that yields 10%."

instead of selling their balance sheet the stupid bastards are giving it away. they belong in prison.

Defensive Positioning in the Bailout's Absence

now these bastards are adding this bill to a tax reduction proposal to circumvent public opinion. i've mailed both of my senators

welcome to the socialist states of amerika comrades.

The Presidential Speech, in Context

johndough110....

you think a federal bailout of walll street is going to save us. how naieve. this problem goes a lot deeper than falling housing prices and bad loans. we have an overleveraged economy and they are trying to prop it up using the same snake oil of low interest rates and excess leverage that pushed it over the edge.

lenders have been forced to wise up and recognize that capital is a precious resource and can't be squandered on people whose net worth has fallen like a stone...which, by the way, includes about 80% of the population of the u.s.

if you look at the yield on short term treasury bills you will discover that you receive virtually nothing in nominal terms to hold them. in real terms you pay for the privelege. this is stuff straight out of the 1930s. what does it mean? it means the credit markets have no faith in this proposed program. the credit markets think it is irrelevant. equity investors, ever hopeful, will dump stocks like they're poison if these spreads don't normalize soon. it isn't a good sign.

you've been warned.

It's a Bull Market in Government Intervention

jcrash....yes, good point, and i agree that the risk premium on money market funds will disappear. but the problem for banks remain because they've now got enormous competition for insured deposits.

a believer,kelly lieberman and bx capricorn...yes there would have been a massive run on banks and investment houses for all funds, and gold would have gone ballistic. the treasury knew it, as did the fed, and that's why they acted. i have never seriously considered precious metals but it's time to reassess my view on that. what equity investments i do have i've hedged with puts. unhedged, long puts on the SPX and XLF or long SDS/SKF might be a better option. we're in exceedingly dark waters and this bailout plan is no panacea. as someone once said "it's the economy, stupid."

It's a Bull Market in Government Intervention

don't worry about the consumer who is underwater on his mortgage. there is a mortgage bailout plan afoot. when you've committed a trillion or two to help wall street) the only way to keep the natives quiet is to throw them a bone too. look for it.

it's also interesting (and quite funny) to watch the greedy bankers scream like hell about the treasury's plan to insure money market funds. banks will lose billions in deposits if this happens unless they match money market rates. ordinarily it would be hilarious but it's hard to laugh at our country having become a bananna republic. there is more capitalism in china and russia than in the united socialist states of america.

It's a Bull Market in Government Intervention

yes...spot on.

if this doesn't push interest rates substantially higher i don't know what will. the socialists got their bailout. i suspect their euphoria will be short lived.

Current Market Turmoil: You Can’t Explain 'Stupid'

who are the parasites, mixter? is it the greedy, republican socialists on wall street or their republican socialist friends in washington who are desperately trying to keep them afloat at taxpayer expense?

you might want to tell that born-again socialist john mc cain that he's a wild-eyed liberal idiot too, since environmentalism is part of his political brand.

Market Participation: 'Fools Jump In'

your analysis is laughably simplistic.

a weak currency is inflationary for an importing nation because it results in higher import prices. we've seen this in spades with the spiking of oil over the last 3 years and it's helped lay the american consumer flat on his back.

as for a weak dollar helping american exports, why should i care? american manufacturing does not mean american jobs, most of which have been exported to asia, mexico and/or india where they still believe in child and slave labor.









but

Market Outlook: It's Still All About Housing

archman has it right.

the average period of home ownership is what, 7 years? the source of the problem is not ma and pa kettle, who lived in the same house 30 years and who grew up when credit was little used and unwanted even if offered. the problem rests with the millions of homeowners who bought houses at inflated prices they couldn't afford, on credit they didn't deserve.

it's the activity at the margin that sinks markets and stocks. the marginal activity that drove this "crisis" occurred over the last 5-7 years. anyone who doesn't understand the concept of marginal change need only consider what happens to a stock when it misses earnings estimates by even a penny. it's not the 95% of shareowners who don't sell that drives the stock down 10, 25 or 20%...it's the 5% who do sell. they set the price at which markets clear.

this is why the federal reserve took...and continues to take..the unprecedented, dramatic steps they did once they realized what was happening. the current fed funds rate, in a normal environment, with honest inflation statistics coming out of washington, would be at least triple what it is currently. that subsidy...the difference between where the funds rate is and where it should be...exists solely to help these ignorant financial institutions recapitalize their balance sheets without diluting shareowners. it's worth untold billions. that subsidy comes from anyone with a money market account. it's a transfer of wealth from the many to the few who helped father the crisis and if it doesn't enrage everyone it's because they're too naieve to understand what's happened.

the severity of this government-induced, asleep-at-the-switch, crisis is lost on people like jason. our financial system came close to collapse. greenspan helped cause it and bernake handed out the corporate welfare to counter it. but the bill has been footed by the taxpayer and it's a long way from being paid off.

Fear of Higher Taxes a Cause of Sell-off

sbenard,

a few points:

1. people can disagree with me if they choose...it's a free country.
2. many "uneducated" people hold formal degrees...but that doesn't confer upon them wisedom or judgment.
3. you might think the masses are educated, but i dont. i think they're preoccupied with their SUVs, their over-mortgaged homes and finding their next line of credit. they will support any war we start, whatever the rationale, and change their mind about it later if it proves misguided. sound familiar?
3. "elitist" is a meaningless, overused characterization of the smug, intolerant right used to brand those with whom they disagree. if i am elitist what does that make you?

instead of doing the same thing you accuse me of doing (name-calling) why didn't you challenge my view of the author's post? there is another argument to be made, you know, and the author didn't make it very effectively. if you'd like to try, have at it. like rush dumbaugh says i'll tie half my brain behind my back to give you a fair chance.

Confessions of a Former Inflationist

housing was a bubble that got out of hand because of recklessly low interest rates, a lack of prudent lending standards, overleverage and thinly capitalized financial institutions unable to absorb the inevitable fallout of their own making. as a by-product, it is the financial system and our u.s. dollar that are crashing. housing is reverting to it's historic price norm in relation to income and affordability.

as for wages dropping, it is no coincidence that this trend emerged not only with increased competition from foreign sources but with "free trade" (it ain't free), an anti-union bias by both government and the private sector and a defacto policy of using illegal immigrants as a source of cheap labor. but i'll tell you who isn't suffering from wages dropping....the incompetent leadership of our major financial institutions that are at the heart of today's financial meltdown. or our complicit, ignorant and naieve government officials asleep at the switch who didn't believe in regulation but in the "invisible hand" of capitalism to keep our institutions on the straight and narrow. but what the hell....that's america. we have freedom to succeed and freedom to steal. what we don't have any more is freedom to fail. the cost of failure belongs to the taxpayers.

those "idiots in europe" have experienced the effects of worthless currencies before. they're smart enough to understand...unlike self-serving wall street and a clueless federal reserve...that the ultimate by-product of a currency that becomes worthless is inflation...not deflation.

"europeans are not known for their intelligence." that's a good one coming from the likes of a country that's exported it's worthless debt securities to virtually every financial center on the planet. i am an american too and i don't mind pointing out that the enemy is not europe...it's us.