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Tue 4:20pm ET- Briefing.com
The stock market had a good day on Tuesday with the major indices scoring sizable gains in a low volume rally that saw 1.3 billion shares...
That would be closer to you head end
Do you guys see any possibility of BKX rising much further or are you guys going to play blogging footsie the rest of day.
I don't like real estate too much so REITs look poisonous IMO
I got shorts on VNO and SHLD
Your thoughts
It looks like 1999 like right shoulder on fed fund rates is in.
One would assume that we are going to zero on interest rates in order to save real estate market.
http://research.stlouisfed.org/fred2/series/FF?cid=118
FED gets to play up the rate cut 1 day before SEP options expiry. They did their policy change statement 1 day before AUG expiry and I think S&P went up 70 pts.
IMO the decline in market we have seen is totally controlled and no matter how we retest the AUG lows in next 2 weeks they are going to rally like no tomorrow when rate cut get announced either before Sep 18th if necessary or on the 18th.
noticed 2 things RE economy visiting in-laws in Trenton, NJ.
- Philly news reporters kept repeating themselves that no one is clogging the roads leaving the Jersey shore today.
- I passed a Glen-Gery brick factory on way down and the stacks of bricks filled several acres about 15' high. I don't remember as much product stacked outdoors as compared to being contained mostly inside kiln building.
Reminds me of Port Newark post 9-11 when recession slowed world trade and empty truck containers were stacked 10 high near NJ Turnpike.
You posted previously about similarities between 1999 and 2007 charts.
My side by side dates are Sep 28 1999 and June 28 2007. Both are last trading days of quarter and this month and Oct 1999 saw similar compression in S&P before it broke out late in the year.
We could be 20% higher by end of year. if today's pattern of trading continues.
Today is start of breakout higher for "party like it is 1999" rally before major pain to pay late this year when effects of Wall street lower earnings takes roost. Mega job cuts on Wall Street only a few days away. The musical chairs of refi of debt is coming to an end so those jobs will go with it.
Date Open High Low Close Volume Adj Close*
29-Dec-99 1,457.66 1,467.47 1,457.66 1,463.46 567,860,000 1,463.46
28-Dec-99 1,457.09 1,462.68 1,452.78 1,457.66 655,400,000 1,457.66
27-Dec-99 1,458.34 1,463.19 1,450.83 1,457.10 722,600,000 1,457.10
23-Dec-99 1,436.13 1,461.44 1,436.13 1,458.34 728,600,000 1,458.34
22-Dec-99 1,433.43 1,440.02 1,429.13 1,436.13 850,000,000 1,436.13
21-Dec-99 1,418.09 1,436.47 1,414.80 1,433.43 963,500,000 1,433.43
20-Dec-99 1,421.03 1,429.16 1,411.10 1,418.09 904,600,000 1,418.09
17-Dec-99 1,418.78 1,431.77 1,418.78 1,421.03 1,349,800,000 1,421.03
16-Dec-99 1,413.32 1,423.11 1,408.35 1,418.78 1,070,300,000 1,418.78
15-Dec-99 1,403.17 1,417.40 1,396.20 1,413.33 1,033,900,000 1,413.33
14-Dec-99 1,415.22 1,418.30 1,401.59 1,403.17 1,027,800,000 1,403.17
13-Dec-99 1,417.04 1,421.58 1,410.10 1,415.22 977,600,000 1,415.22
10-Dec-99 1,408.11 1,421.58 1,405.65 1,417.04 987,200,000 1,417.04
9-Dec-99 1,403.88 1,418.43 1,391.47 1,408.11 1,122,100,000 1,408.11
8-Dec-99 1,409.17 1,415.66 1,403.88 1,403.88 957,000,000 1,403.88
7-Dec-99 1,423.33 1,426.81 1,409.17 1,409.17 1,085,800,000 1,409.17
6-Dec-99 1,433.30 1,434.15 1,418.25 1,423.33 916,800,000 1,423.33
3-Dec-99 1,409.04 1,447.42 1,409.04 1,433.30 1,006,400,000 1,433.30
2-Dec-99 1,397.72 1,409.04 1,397.72 1,409.04 900,700,000 1,409.04
1-Dec-99 1,388.91 1,400.12 1,387.38 1,397.72 884,000,000 1,397.72
30-Nov-99 1,407.83 1,410.59 1,386.95 1,388.91 951,500,000 1,388.91
29-Nov-99 1,416.62 1,416.62 1,404.15 1,407.83 866,100,000 1,407.83
26-Nov-99 1,417.08 1,425.24 1,416.14 1,416.62 312,120,000 1,416.62
24-Nov-99 1,404.64 1,419.71 1,399.17 1,417.08 734,800,000 1,417.08
23-Nov-99 1,420.94 1,423.91 1,402.20 1,404.64 926,100,000 1,404.64
22-Nov-99 1,422.00 1,425.00 1,412.40 1,420.94 873,500,000 1,420.94
19-Nov-99 1,424.94 1,424.94 1,417.54 1,422.00 893,800,000 1,422.00
18-Nov-99 1,410.71 1,425.31 1,410.71 1,424.94 1,022,800,000 1,424.94
17-Nov-99 1,420.07 1,423.44 1,410.69 1,410.71 960,000,000 1,410.71
16-Nov-99 1,394.39 1,420.36 1,394.39 1,420.07 942,200,000 1,420.07
15-Nov-99 1,396.06 1,398.58 1,392.28 1,394.39 795,700,000 1,394.39
12-Nov-99 1,381.46 1,396.12 1,368.54 1,396.06 900,200,000 1,396.06
11-Nov-99 1,373.46 1,382.12 1,372.19 1,381.46 891,300,000 1,381.46
10-Nov-99 1,365.28 1,379.18 1,359.98 1,373.46 984,700,000 1,373.46
9-Nov-99 1,377.01 1,383.81 1,361.45 1,365.28 854,300,000 1,365.28
8-Nov-99 1,370.23 1,380.78 1,365.87 1,377.01 806,800,000 1,377.01
5-Nov-99 1,362.64 1,387.48 1,362.64 1,370.23 1,007,300,000 1,370.23
4-Nov-99 1,354.93 1,369.41 1,354.93 1,362.64 981,700,000 1,362.64
3-Nov-99 1,347.74 1,360.33 1,347.74 1,354.93 914,400,000 1,354.93
2-Nov-99 1,354.12 1,369.32 1,346.41 1,347.74 904,500,000 1,347.74
1-Nov-99 1,362.93 1,367.30 1,354.05 1,354.12 861,000,000 1,354.12
29-Oct-99 1,342.44 1,373.17 1,342.44 1,362.93 1,120,500,000 1,362.93
28-Oct-99 1,296.71 1,342.47 1,296.71 1,342.44 1,135,100,000 1,342.44
27-Oct-99 1,281.91 1,299.39 1,280.48 1,296.71 950,100,000 1,296.71
26-Oct-99 1,293.63 1,303.46 1,281.86 1,281.91 878,300,000 1,281.91
25-Oct-99 1,301.65 1,301.68 1,286.07 1,293.63 777,000,000 1,293.63
22-Oct-99 1,283.61 1,308.81 1,283.61 1,301.65 959,200,000 1,301.65
21-Oct-99 1,289.43 1,289.43 1,265.61 1,283.61 1,012,500,000 1,283.61
20-Oct-99 1,261.32 1,289.44 1,261.32 1,289.43 928,800,000 1,289.43
19-Oct-99 1,254.13 1,279.32 1,254.13 1,261.32 905,700,000 1,261.32
18-Oct-99 1,247.41 1,254.13 1,233.70 1,254.13 818,700,000 1,254.13
15-Oct-99 1,283.42 1,283.42 1,245.39 1,247.41 912,600,000 1,247.41
14-Oct-99 1,285.55 1,289.63 1,267.62 1,283.42 892,300,000 1,283.42
13-Oct-99 1,313.04 1,313.04 1,282.80 1,285.55 821,500,000 1,285.55
12-Oct-99 1,335.21 1,335.21 1,311.80 1,313.04 778,300,000 1,313.04
11-Oct-99 1,336.02 1,339.23 1,332.96 1,335.21 655,900,000 1,335.21
8-Oct-99 1,317.64 1,336.61 1,311.88 1,336.02 897,300,000 1,336.02
7-Oct-99 1,325.40 1,328.05 1,314.13 1,317.64 827,800,000 1,317.64
6-Oct-99 1,301.35 1,325.46 1,301.35 1,325.40 895,200,000 1,325.40
5-Oct-99 1,304.60 1,316.41 1,286.44 1,301.35 965,700,000 1,301.35
4-Oct-99 1,282.81 1,304.60 1,282.81 1,304.60 803,300,000 1,304.60
1-Oct-99 1,282.71 1,283.17 1,265.78 1,282.81 896,200,000 1,282.81
30-Sep-99 1,268.37 1,291.31 1,268.37 1,282.71 1,017,600,000 1,282.71
29-Sep-99 1,282.20 1,288.83 1,268.16 1,268.37 856,000,000 1,268.37
28-Sep-99 1,283.31 1,285.55 1,256.26 1,282.20 885,400,000 1,282.20
* Close price adjusted for dividends and splits.
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You can't keep the Chinese market down for long
http://cn.finance.yahoo.com/q/bc?s=000001.SS&t=1d
I got an offer for my office building in July and closed in Oct.
I truly feel sorry for the buyer as long as his mortgage payment comes each month.
He had it for rent at first; then for sale for 6 months; now back for rent.
added TCO to reit shorts had VNO already.
Do you expect BKX to crack or to continue a slow bleed.
It seems that credit risk repricing is costly if HD dropped price of deal by 18%.
That deal was only $ 10 B of the $300 B in the M&A pipeline. If this trend continues that means $ 30-50 B going to Zeev's "money heaven" just from pending M&A deals.
Every other debt class getting good haircut
high FICO score jumbo mortgages from TMA shaved 5%
total pool is at least $ 7000 B or $ 350 B at 5%
sub prime stuff discounted 20% or $ 600 B out of $ 3000 B
and now HD M&A off 18%.
Enron & MCI was only what $ 200 B.
I think that most brokerage firms were carrying customers home equity lines on margin. Customers will get a big shock when they reduce buying power on those "leveraged" assets and hike the margin interest rate to cover soe of the deadbeats.
People will prbably decide to sell some stock assets to cover some real estate debt in their potfolios.
When I grew up in Franklin Lakes, NJ in the 60's it was a community developed from 600 acres donated to the Catholic Church who handed to an Catholic developer who hired a Catholic real estate agency so you ended up with a a mostly Catholic community after the homes were sold.
We are talking about mostly large Catholic families with some having 10-11 children. Grandparents and aunts living in the same house were common.
Anyone who built a 3,000+sq ft house in the 60's had at least 6 kids.
I see these 4000 sq ft houses today with 1-2 kids and say whats going on. Maybe I am feeling out of tune with the 30 something crowd.
50 bp would be a big deal at par but with the markdowns being requested and FED giving 98% of loan value it is a brand new game IMO.
All mortgage assets written before last month do not have true risk premium accounted for so every loan now selling for less then par.
It is truly funny how investment banks are demanding 5% discount for prime loans like Thornburg was offered; 20% or more for sub prime and alt A loans and getting it from overleveraged mortgage loan holders.
Then, the way I see it, investment banks are taking these varying degree of credit quality loans over to the FED discount windows and getting 98% of face value at 5.75% and going to town with the money.
How can market be effectively shorted if every potentially stinky loan can be potentially converted into cash at a tidly profit at the discount window and never be marked to market while in the hands of fed vs if same loan was held by mortgage firm.
FED not going ask about condition of loans since they assume they will get repaid from banks.
Later as in the next few weeks. Market timing is not my forte.
Market at best taking profits after Ben's "Bring us your trash for cash" call this morning.
Rate cut comes later after we retest yestrday's levels.
Cancer rates are pretty much in line with calorie intake and obesity levels. Fats being the worst offender. Poly unsaturated fats being the worst for you because of the higher oxidation potential vs good fats like monounsaturated olive oil.
http://news.nationalgeographic.com/news/2005/03/0321_050321_oliveoil.html
I am more worried about hormones and similar highly aliphatic carcinogenic compounds that then to separate out with the fat in dairy products.
http://www.raw-milk-facts.com/hormones.html
http://archive.greenpeace.org/toxics/reports/azd/azd.html#Food
I just happen to read the BBC news preferrentially so I can be somewhat informed if not especially gramattically correct. I remembered this article from last week.
Th overlying reason for dairy prices going up worldwide is the offical push by the Chinese government to stress increased comsumption of dairy products.
http://news.bbc.co.uk/2/hi/uk_news/magazine/6934709.stm
I am listening recently to Lucinda Williams and the Springsteen Live in Dublin CDs. The East Asians rarely play any music from their homeland while they pump but the people from the former Soviet republics always play their music loudly.
Fuel economy display tells me it's 19.1 MPG I was constantly in the 20-21 range before ethanol.
Since I am drifting into the corn for yeast vs mammals topic, I been noticing that the majority of corn fields in NJ have
large signs identifying what type of genetic corn variety is planted.
The majority of fields are planted with a variety from a company whose initials are NK. That is the seed division of Sygenta SYT.
Any thoughts on any stock plays related to corn.
$2.49 is in Northwest Jersey near NY and PA where they don't put as much ethanol in the blend since they have cleaner air.
Closer to NYC it is $ 2.55 even though it is closer to refineries.
OT gas prices
Lowest price in NJ I am seeing now is $2.49
They are going to hold the S&P above 1440 at all costs.
We need to stay above 200 day MA
http://finance.yahoo.com/q/ta?s=%5EGSPC&t=3m&l=on&z=m&q=l&p=m200,m50&a=&....
We rallied to that price or reversed from that level later in the day 6 times today.
What wonders FED dollars can do.
Shorts will get tired if we hold this level by Tuesday
The pain will hit harder the lower down the economic ladder you go.
In Newark NJ (90%+ minorities), offers 5 year tax abatement to anyone who redevelops vacant land remaining from the 1967 riots.
You have seen a lot of 2 family homes go up in the $400-500K range that increasingly having for sale signs or for rent signs on them. Mixed in the 20 square block Central Ward are many cement foundation shells that have been abandons by their builders.
Property tax assessments on these 2 family houses are about $12,000 and will kick in over the next 2-3 years as the tax abatement wears out. If the interest rate uptick doesn't make them go empty surely elimination of the 100% tax abatement will.
Futures off 12 it's getting fugly
The fact that it has gotten to this point tells you we are in serious problem. We got central banks around the world providing liquidity to institutions as the average investor gets nervous and sells while they got a profit.
ECB Moves to Add Liquidity to Market
http://biz.yahoo.com/ap/070809/europe_ecb_liquidity.html?.v=5
My broker has gone into his defensive semi catatonic persona reminiscence of 2001-2 when I open a new short position. Say goodbye to Mr. Bull market.
forgiven loans (debt discharge income) and home sale gain exclusions don't seem seem to be routinely taxed on federal level.
http://finance.yahoo.com/real-estate/article/102969/Taxes-When-You-Sell-Your-Home-at-a-Loss
I am more worried about the money hungry NJ Department of Treasury rules which usually exclude most federal tax preferences like recapturing all estate tax deductions, capital losses offsetting of capital gains etc.
Some semi analytic foreclosure data
I was talking to person in Warren County, NJ (pop. 104,000) clerk's office today where they are doing a brisk business.
They said they typically had 2-3 foreclosure per week but now they are up to 5 per day.
Banks are saying f***em to homeowners; no such thing as walking away scot free.
CSCO 31.41
I noticed that Cablevision in NJ was pushing Scientific Atlanta cable endpoints with VOIP boxes instead of Motorola. However, the SA boxes are crappy and would take the Motorola anyday.
Previous Congress got what they wanted by clipping the wings on the GSE's power to underwrite large amounts of good loans claiming the earnings smoothing scandal as the justification.
Big banks clamored to fill the void created by legislation and also looking for big profits got greedy by selling loans to many people who were clearly not capable of paying back those loans.
Now the big banks are looking for GSE's to get their backsides out of the fire.
Unbelievable
S&P futures 1466 which is about 1458 so market has sold off 10 pts from 1468 since 4 PM.
More lower highs, lower lows IMO
Fed either bails out market big time tomorrow or market tanks big time to next support level which looks way down below 1400.
I think a saw a chart with some reasonable support at 1280.
Bond Crisis is an economic 9/11 IMO
I have been donating platelets several times a year at a church drive in Basking Ridge NJ for several years now and know implicitly the attendance level of donors at this church as well as helping run the blood drive at our church in the next town over.
They are on one of the main commuter train lines out of lower Manhattan and Jersey City where Wall Street moved to after 9/11. 11 parishioners lost their lives on 9/11 from this parish out of 1500 families.
Today the crowd was extremely heavy for a summer Sunday. I mean there was 6 people lined up for the 6 available aphoresis machines at 12:15 PM and about 5 for whole blood donations. Usually there is 2-3 total donors at this time. I don't attend this church but I don't think they were making any special preparations to attract a larger attendance since they didn't even have coffee, donuts or fruit for the donors. Nor do I think they got a bunch of runners preparing for NYC marathon in Oct.
Since the only other time I saw this type of upswing in donor pickup at our church was after 9/11 and the start of the Iraq war. I don't think any one in Basking Ridge is going to lose their house for any increase in the teaser interest rates on their mortgage but for the fact that they may lose their well paying job in financial services with the brokerage firms in lower Manhattan or Jersey City.
I think that worrying about the losing of your job could make you want to the right things in life if you think the job cut axe may not fall on your head if you do a good deed.
I thought 70%+ were home owners already. It just may be a smaller number a year or two from now.
It is hard to justify staying in a house if your in negative equity position or if the reset adjustable rate mortgage payments are unaffordable or you lost your job or if your pay scale has been reset like the UAW workers.
I think we will just glance 1484 intraday and then do reverse of this afternoon to the close.
Any jobs number will do the trick execpt if below 100K or over 175K
Market makers can only extract extra cash without making chartists panicky by squeezing the greedy shorts and any dip buyers who think things will reverse quickly.
Give me the 10% correction then I would feel much more comfortable just being long.
Its been like shooting arcade ducks being short homebuilders, anything associated with mortgages and investment banks.
Gold and energy not safe from correction either.
It will get to crisis proportions in these sectors before and meaningful turnaround.
Next stop touching 1485 again.
I going to close my long S&P at that point to close out a hopefully profitable trade started when everything looked like crap. Market is still crappy but it's been very tradable as it goes through an orderly decline.
1450-1485 box too tight to stay enclosed in for very long.
Oddest looking comparison chart I've sen in a while.
http://finance.yahoo.com/q/bc?s=%5EGDAXI&t=3m&l=on&z=m&q=l&c=000001.ss
Looking at different time ranges doesn't make it stop cross overs
PS
Hurricane is forming in the tropics
http://www.nhc.noaa.gov/refresh/graphics_at3+shtml/023536.shtml?basin#contents
I basically agree with your lining up cycles to a great degree but wasn't going to post gut feelings from looking at daily charts of 7 -8 years ago and get flamed.
I was thinking that similar pint on timelines was
end of 2nd Q 2007 and end of 3rd Q of 1999.
SEP & OCT of 1999 was a lot of sidewards with lots of down with quick retracements going sideways with sector rotation into tech from balance of more moribund market sectors.
We made explosive move up at EOY and eventually led to sad topping action in Springtime.
I can remember shorting market and not making much headway in late 1999 when I knew things could get very ulgy from a valuation standpoint. Became clown long in FEB 2000 and ran for the hills like everyone else in APR.
We basically gone no where in last 6 weeks.
I see many paralells today to 2000.
Only difference is "lying" is quality of debt on liability side of ledger rather on income side of ledger in 90's.
No one wil go to jail for assuming dead beat borrowers will not pay.
Not that I put any emphasis on what Jim Cramer says on his TV show but I basically assumed he was mostly bullish kind of guy.
He is being quite bearish today.
Homebuilders according to him should close their doors. brokers dealers stock prices are going to get cut in half and bank will cut dividends by 50% or more.
It took all day to retrace last 1/2 hour of Friday. I would like to see it at least retest 1489 where it was Friday morning.
Banks were up today.