enigmaman

Wall Street Breakfast: Must-Know News

And to make everybody feel better about the future and the benefits of the 787 billion stimulus bill the AP reports this bit of news


WASHINGTON — A top White House economist says spending from the $787 billion economic stimulus has already had its biggest impact on economic growth and will likely not contribute to significant expansion next year.

Christina Romer, the chair of President Barack Obama's Council of Economic Advisers, said Thursday that the $194 billion already spent gave a jolt to the economy that contributed to growth in the second and third quarters of the year. She told a congressional panel that by the middle of next year, the impact of the stimulus will level off. Romer said spending so far has saved or created 600,000 to 1.5 million jobs but warned that unemployment will remain high, above 9.5 percent, through the end of 2010.

Closing Update: Stocks String Together 3 Straight Wins, Commodities Gain

consumers reduced credit borrowing by 21.6 billion in the month of June, economist predicted the number to be 4 billion so the economic geniuses who tell us what to expect from the future missed by a factor of 5, what else might they have gotten wrong about the economic recovery, for one thing if they are waiting for the consumer to return they will have to wait a lot longer then they expected, multiple by 5 the number of months they had anticipated the return of the consumer and then maybe we will be dealing in reality, this sobering consumer stat has to do something to make the market pause and ask, WHAT!

Speculative Trading Indicates Rally Losing Steam

Something to think about

Taken from The Drunkards Walk "Peering through the Eyepiece of Randomness" by Leonard Miodinow

A lot of what happens to us-success in our careers, in our investments, and in our life decisions, both major and minor-is as much the result of random factors as the result of skill, preparedness, and hard work. So the reality we perceive is not a direct reflection of the people or circumstances that underlie it but is instead an image blurred by the randomizing effects of unforeseeable or fluctuating external forces. That is not to say that ability doesn't matter-it is one of the factors that increase the chances of success- but the connection between actions and results is not as direct as we might like to believe

Sobering Stat: ARMS Index Indicates Market Is at Peak, Not Bottom

Can you provide a graph comparing the S&P 500 move as it relates to your TRIN since the rally began, then you will be able to see the correlation if any.

Speculative Trading Indicates Rally Losing Steam

You said " If I lose it all, I have nobody to blame but myself and not the anthropomorphic market."

So your a gambler not an investor, then your paper gains are not relevant or any indication of your prowess, its what you take home thats signifies whether your a genius or fool, that your willing to throw the dice and risk losing it all means your reckless, especially saying that your willing to take more risks for more reward as the laws of probability stack up against you


On Aug 29 10:26 AM beach bum 2009 wrote:

> Clearly, the return to "normal" from the pit of fear hid enormous
> opportunity. Pickings will be slimmer going forward. I expect never
> to see 100% gain in a mere 5 months on my portfolio again. But I
> will continue to take higher risks in search of higher rewards. If
> I lose it all, I have nobody to blame but myself and not the anthropomorphic
> market. Citigroup looks nice, especially while the MBA's all scoff
> at it. A 6% short interest helps too! Good luck to you ALL.

Speculative Trading Indicates Rally Losing Steam

beach bum- you are the exception and not the rule, being able to do what you did in the face of all the chaos and concern is text book contrarian thinking, great you could do it, because the masses could not. When the fire department is yelling fire and run for your lives its wise to listen to them, doing the opposite is nonsensical, except during certain crazy times in the market place. Now if you are able to keep 80% of your gains I would really be impressed, all you have to do is sell everything on Monday, will you or are you willing to throw the dice a few more times. You looked into the blackness of the abyss and saw opportunity and it worked, was it pure luck or genius, now though your looking into brighter skies but the future is murky and harder to read, what will you do?

Speculative Trading Indicates Rally Losing Steam

The article says about these securities "There’s no value. This is all speculation," from your post it appears your take is "Rally On", good luck with that


On Aug 29 06:34 AM rick12345 wrote:

> LOL... Another clown who thinks equity markets will fall back to
> March levels..
> I hope you all read the following article on the various idiots who
> tried to short sell AIG and had their fingers burned. If not, heres
> a link for you
> www.bloomberg.com/apps...;sid=avo4UmCFM2v8

Sobering Stat: ARMS Index Indicates Market Is at Peak, Not Bottom

No surprise, recent days where 1/4 of daily volume involved handful of securities, double digit daily gains of virtually insolvent companies, market churning going nowhere for the past week, bounce in the morning, flat all day then bounce at the close, market seems to be struggling to stay positive, overly bullish sentiment getting stronger as daily volume has been picking up just as the market appears to be rolling over

Four Reasons We're Headed Even Higher

And now a word from the National Bureau of Economic Research (abstract)
Long-term data for 25 countries up to 2006 reveal 195 stock-market crashes (multi-year real returns of -25% or less) and 84 depressions (multi-year macroeconomic declines of 10% or more), with 58 of the cases matched by timing. The United States has two of the matched events--the Great Depression 1929-33 and the post-WWI years 1917-21, likely driven by the Great Influenza Epidemic. 45% of the matched cases are associated with war, and the two world wars are prominent. Conditional on a stock-market crash, the probability of a minor depression (macroeconomic decline of at least 10%) is 30% and of a major depression (at least 25%) is 11%. In a non-war environment, these probabilities are lower but still substantial--20% for a minor depression and 3% for a major depression. Thus, the stock-market crashes of 2008-09 in the United States and other countries provide ample reason for concern about depression. In reverse, the probability of a stock-market crash is 69%, conditional on a depression of 10% or more, and 91% for 25% or more. Thus, the largest depressions are particularly likely to be accompanied by stock-market crashes, and this finding applies equally to non-war and war events. We allow for flexible timing between stock-market crashes and depressions for the 58 matched cases to compute the covariance between stock returns and an asset-pricing factor, which depends on the proportionate decline of consumption during a depression. If we assume a coefficient of relative risk aversion around 3.5, this covariance is large enough to account in a familiar looking asset-pricing formula for the observed average (levered) equity premium of 7% per year. This finding complements previous analysis that were based on the probability and size distribution of macroeconomic disasters but did not consider explicitly the covariance between macroeconomic declines and stock returns.
Just another opinion, point of view from a non partisan group on the long term prognosis for the economy

Four Reasons We're Headed Even Higher

I will confess I wish I was more invested so I could have taken advantage of this huge move but I wasnt and Im not and I wont, the good news I no longer worry about it, water under the bridge. IMO- this market is looking tired, light volume rally, the market run was not on fundamentals it was all because it was Backed by the US Government, now though those deals are running out, treasury sales are doing OK could be better could be worse and will be, Bernanke is beginning to tighten the reigns ever so slowly by letting programs expire, no more cash for clunkers, first time buyer program is in its 9th inning, higher oil will return, fed tax shortfall will need to be addressed, 2T fed deficit surprise will eventually sink in, China tippy toppy market, 1.5 M soon losing unemployment, I dont know you tell me, is there more juice in this market or has it all been squeezed out, will the smart money try to get the last penny of will they leave something on the table for others to fight over while they slip out the back door un noticed, thats what I would do if I was part of the smart money crowd.

Four Reasons We're Headed Even Higher

You said " that 2009 would be the year of premature top calls" that was a no brainer because there always have been and will always be prognosticators that try to call tops and bottoms based on whatever fundamentals and technicals that appear to reinforce their belief. But eventually one of them will be correct correct. You seem to make fun of Doug Kass a bear who correctly called the bottom, a genius but now a clown because he is calling the top. Believe what you will at your own peril but no matter how good the market appears from its lofty heights, except what is reported the game has not improved on the playing field

The Lunacy Surrounding AIG's Stock Price

Fed gov has been very quiet about the action of it positions in AIG, BAC, Citi,Fannie, Freddie because its working in their favor, they are against any and all so called Wall Street shenanigans except when it is in their favor then they are silent, they cut a deal with GS, do your worst so we can do our best, pump so we can dump, its always about the bottom line

Closing Update for Friday, August 21: New Highs for 2009

Im one of the the market rally doubters to my own financial peril, found to many reason why I shouldnt and not enough reason why I should believe this rally was worth my money,

" A mind all logic is like a knife all blade, it makes the hand bleed that uses it"

Sometimes its true 2+2 doesn't always equal 4