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This is precisely why governments should NEVER intervene in free enterprise.
By the government shoring up the balance sheets of their competitors, then why WOULDN'T the Nissan's & Honda's of the world try to meet that advantage??? Why NOT eliminate high interest paper to the public & replace it with low interest rate paper to the government???
This snowball effect is caused by intervention.
If our government got the message on "protectionism" during the Great Depression in relation to global trade, then they had better get the message on "protectionism" with relation to business and business sectors operating within the American free enterprise arena. The protectionism they are using will keep the unwary/unprepared/overextended businesses in place while dessimating the wary/prepared/solid businesses competing for greater marketshare.
This whole string of conseqences is predictable and, at the same time, gut wrenching.
Okay, bud! I'll be at a keyboard tomorrow. If there is a great (I do mean GREAT) trade in AA, we pounce.... that's the game plan. In the meantime, I will buy ALL the AA you got @ $9.50 for ... uhmmm... (this is how greed works-->) $9.51 !!!!!
Okay, bud! I'll be at a keyboard tomorrow. If there is a great (I do mean GREAT) trade in AA, we pounce.... that's the gameplan. In the meantime, I will buy ALL the AA you got @ $9.50 for ... uhmmm... (this is how greed works-->) $9.51 !!!!!
This is true! But I am t-o-t-a-l-l-y convinced that he would be MUCH better if he were the owner of AA @ $9.00 a share. In fact, he would make SURE he stayed alive to reap the profits of his wife's good trades....
Oooopss... a trade that didn't happen today! Maybe it will happen in Elroy's Great Depression! Either way, it's gotta happen!
I want to grab that bottom (no fill on the order) and you want to grab the top (no fill on the order)..
Do we need to change our ways & settle for "in between"?
I watched it move upward from the moment Bush spoke at the Manhatten meeting. This is the FIRST time I have heard a speech in which he did not beat around the bush (no pun intended) and actually said that we are facing a possible Global Meltdown. He reiterated "meltdown" a second time. Then went on to say what remedies the Gxx meetings of tomorrow night & Saturday would address... then cautioned that the problems are too complex for one meeting... there will be a series of meetings.
The market took off & I think everyone followed suit.
I've been at the hospital since 4:30 this morning (hubby had outpatient surgery)... he's fine... we're home. But I jumped to the TV & watched the carnage (down over 300 points) & couldn't get a feel for the price movement of AA. Then, Bush... then rally...
Dang! AA's low was 9.50 today & I have a GTC sittin' at 9.00.
Isn't that the bad luck we always talk about????!! Wish I wasn't such a cheapsake!
What a chump. He left no money to the maid who had to clean up??? Just words of apology???
Hmmmmmm. That's a chump.
I take issue with that. An "F" is the same as someone who is totally irresponsible & does NOT even attend the class. If someone attends the class & just "doesn't get it", then a D- is fine by me... even if they failed the test percentage-wise.
For flagrant non-attendance, and subsequent "Zero" score, the price should not be the same as full attendance with a "54%" score.
The "F" is telling the world that you would have been just as good as if you had never attended the class.
JMHO
Gaaaaaads... don't answer, k??!!
Which one??
Nice. I'm a happy camper.
Now, they just need to give me about 4 of those windmills..
News Flash:
Robin Hood is the chairman of the Fed Reserve
Robin Hood is the chairman of the Treasury
Robin Hood 'behavior' is being endorsed by the American Gov't.
Who said fairy tales can't come true...
Doggone Richard, when you snooze, I 'might' lose...
Into GE @ 16.71... trigger pulled.
Agreed... I will like AA below the 52 week low.
GE just busted through the 52 week low. What is your thought here?
Thoughts on GE & AA for a buy level today?
Oh yeah...
And can have 3 quarter horses, a zillion deer, ground hogs, blue cranes, squirrels, chipmunks, skunks, fox, minks, wild turkey, every sort of bird, geese, ducks, raccoons, rabbits, possums, doves, and dogs that are never chained.
That's how I spend a weekend... and I love it!
Well, I guess when you leave a smog filled environment & move to the the Bluegrass, then you can certainly live on a farm (non-collective, fully owned) and raise cattle & tobacco in the damn near gorgeous land of Kentucky. That's what hubby does.
If you say your prayers every night, go to church on Sunday, and are good to your neighbor, then when you die, you'll go to Kentucky.
That's a fact.
We contracted before the 2008 crop was planted. We have sold direct to them since '97.
Prior to the quota system being removed, we could sell to about 4 buyers and, if their grading was screwing us, we could sell to the co-op.
Now, Phillip Morris locks the farmers prior to crop, there are not 4 buyers in warehouses (actually, all the warehouses are being torn down now), and the co-op only buys about 3 million pounds a season.
We need more of an open forum with (at least) the 4 main buyers bidding against each other.
I sent the link to my home to read tonight but (I must tell you) I got really excited just at the front page of the link!
Now then, this is priceless. I think I'll click "KEEP"...
This is great news, Nick (she says sarcastically)...
We contract with PM. Every year, there's a new excuse to hammer down the price of the crop. Now, they'll say that funding is short... so the price they pay for top grade tobacco will be lower.
We sell in Dec & Jan. You just wait... they'll pull that funding card...
I will sharpen my nails.
Gaaads! You nailed it!!
I know this is off-topic, but I have to tell you...
My grandmother used to sneak over to the actress changing/make-up area & gawk at the beautiful clothes & wonderful starletts (sp). She befriended some gal that later became pretty famous, but in those days it was not allowed to "converse with such women". Now then... the actress needed sugar & my grandmother went home to get some. She slithered back into the dressing room with the heralded sugar & found her mother at her heels.
I am sooooooo surprised she lived beyond that day...
Oh, those gals. She has soooooo many stories... mobsters & tommy guns in the streets...
Some of the better movies depicting that time barely bring alive her stories.
Very impressive.
Thought you might like my husbands great-great Aunt...
http://en.wikipedia.org/wiki/Carrie_Nation
His great-great... great... grandfather was one of the Kentucky Long Knives ... then, every generation in every war in America... oodles of land gifts from the governors in the New America..
Like I said, JOHN WAYNE.
Hollywood was an awesome place (according to MY granny) once the movies came.
Blood boil number two....
And I was JUST getting my sense of humor back...
And, each pair will only have ONE leg...
Now, now...
Don't pick on Palos Verdes...
Head over to the Avacado Farms, k?
LOL!
Same here... but not in my industry yet.
It's a heartbreaking thing to hear. I become speechless & feel helpless, but I encourage them to keep their dignity & pride as, when these things turn around, it's folks like them who have the experience to lead.
Ohhhhh thank you Court! As if I needed ONE MORE blood-boil today....
It seems to be falling off of a cliff! In some cases, about half of what it was in July/Aug.
Are you still tracking stainless?
That is exactly what I meant about "approach".
Nick has core holdings & trades around them quite successfully. It appears that you were able to do that too during some of the period (and, successfully as well).
Since you have traded for soooo long using technicals & charts, some of the signals (or confirmations) pop out to you. I don't think I would be able to clearly see a confirmation without more education in candlesticks.
An example would be the cup & handle you brought up the other day. I went to the charts & looked at the cup & handle... then went to about three sites that explained cup & handle (how to recognize... time length for validity... probable move thereafter). The sites gave examples of a "U" shape (noting that the bottom needed to be much more flattened than a "V" shape). When I went back to the chart & looked at the cup & handle formation, the sides looked too steep and the bottom didn't seem flat enough to fulfill their definitions. I was lost as I knew you could see it.
Now then... I can't remember which chart (timeframe) I was looking at... but you came back later & said the 60 minute chart showed the cup & handle. Alas! If I had the right timeframe, possibly I could have seen it. The examples I was referred to in the explanations were all 1 to 2 month charts.
My guess is that this is going to take me a long, long time...
Every time the interest rate has lowered, the real estate industry seems to increase the price of the home. And, when interest rates fall, the price of the home seems to get lowered.
With the Treasury financings over the next 90 days, interest rates may very well increase on the 10 year. It could be that further reductions in home prices will follow.
I'm not sure if your model has such a scenario ( sustained falling prices followed by increased mortgage rates ), but it would be terribly interesting to look & see if it does. If it does, what was the outcome?
I think he did awesome! The other night, I found several posts I printed out (and marked: DO NOT LOSE) from Eric & Mike from 2002 RB board. They were talking Bollinger Bands & explaining the significance of the bands narrowing. I'm just wondering if those good ole Bollinger's were used.... just curious... cuz I got the meat on how he does it printed out!
Just kidding, honest.
Hey, I'm headin' home to salute our next Prez... whomever he may be. This might be an all-nighter!
Talk to you tomorrow!
As I posted earlier today, Volvo truck orders were 115 (not a typo) Q3'08 as opposed to 41,000 Q3'07. There isn't a company in the world looking at that type of an order base reduction (so devastated as to 'idle' the workforce) that wouldn't react by reducing the workforce. More importantly, the vendors servicing that industry adversely affected by the downturn must, in turn, follow suit.
I think two things come to play simultaneously: 1) the necessity to focus on monthly or quarterly financial performance and 2) the speed of information disseminated from that focus. Granted, during the Great Depression (or possibly prior to it) companies maintained hope that previous good times would return. Additionally, Wall Street had to send out 'spies' to infiltrate the companies in order to get information as to what was really happening. Most of it was table talk, not too many hard numbers, but that was the way it worked back then. Any high five to calm investors could be mirrored throughout the nation until, by consequence of the downturn, it became a mute gesture.
Now, the speed of information is bringing problems or successes straight to the market for immediate digestion. And, once the market digests that news (assuming it is bad news), then investors make their move... and no 'high five' can stop the speed of an investor with access to a keyboard to trade.
Layoff announcements are all around us. Sometimes, it boggles me as to how hard that will be for our populus to experience. It is tragic and heartbreaking. The financial backlash comes within months of those actual layoffs. That puts a very dark cloud over Jan/Feb.
If the real estate markets decline in areas where large layoffs occur at an accelerated pace, the spill-over to yet "still healthy" areas is inevitable.
If I am reading what you are saying properly, then you believe an acceleration in layoffs has occurred and the spill over in real estate value decline is accelerating as well (albeit at a different pace).
Do I understand you right?
What happened, or what did you learn, in the last 23 1/2 hours (see post #42605) that lopped off February & now rests with January?
I'm on record for two weeks stating that I think Jan/Feb will be brutal, but I haven't changed the timeframe whatsoever. I would, however, change the timeframe if some new information came my way.
Do you have new information?
Mike
"Ultra" means 'twice' in the ProShares world, doesn't it?
So, if you were betting the financials going down, you would invest in SKF (an Ultra fund)... and, if you were betting that financials would go up, then you would invest in UYG (an ultra fund), right? And, via share price, the fund moves up & down at twice the movement of the Dow Financials?
I am soooo intrigued by this. I realize you stated that you used options for protection, short-lived or otherwise, but I'm more interested in how you approached it.
If you toggled between long positions in both funds, then you were toggling around your belief of which direction the financials would be heading. So, then, is the thought (by using two funds with opposite directive paths whenever each fund strategy applies) that you would change funds at either a peak or a valley?
I am up 2%. That means I beat the Dow & S&P performance by 40+ %, but it does NOT mean I am UP the same percentage. You have a 29.6% return...which would mean you beat the Dow & S&P performance by nearly 70%. That is AWESOME, & I'll be the first to say so!
I would have to say that if you did this on a full time basis in the future, you certainly are waaaaaay ahead on the learning curve. I certainly hope I can comprehend how this works!
IMF thesis gives no reason to think the worst is over
By Tony Jackson
Published: November 3 2008 02:00
..."one of the more startling statistics of recent weeks: that Volvo's European truck sales in the third quarter fell from last year's 42,000 to just 115..."
..."The news of collapsing world car sales, it appears, had somehow passed investors by.
That makes yet more pressing the question of how far corporate earnings have to fall. But first, let me touch on an arresting thesis set out in the latest World Economic Outlook from the International Monetary Fund.
In a study covering 17 developed economies over three decades, the IMF came up with three findings of particular relevance.
First, recessions preceded by a financial crisis tend to be deeper and longer than others.
Second, they tend to be worse again if the crisis is in banking, rather than in securities markets or foreign exchange.
And third, the countries hardest hit are those with so-called arm's length financial systems, such as the US or UK. If banks are free to innovate, they tend to build up more pro-cyclical leverage.
In practical terms, the IMF found that recessions linked to banking crises lasted twice as long on average as those not linked to any financial crisis, and the cumulative loss of output was about four times as great.
The present recession, plainly, ticks all the boxes - a fact that makes it unlike any in recent memory.
That of 1990-91, for instance, was only partly financial and not much to do with banking, being preceded by the Japanese stock market collapse and a junk bond crash in the US.
There was a severe Scandinavian banking crisis after that recession had got under way, but that was primarily local. What we have today is an increasingly global banking crisis, which is bad news all round.
With that, let us turn to the Citigroup thesis on the coming earnings recession. Citi envisages a 50 per cent fall globally, of which 10 per cent has happened already. And partly with the IMF findings in mind, it says the process could last up to three years.
Crucially, though, Citi assumes that corporate return on equity will only fall to the 8 per cent trough seen in the past two earnings recessions of 1992-93 and 2001-02.
The fall seems steeper this time merely because of the starting point - the return on equity at the peak having been a record-breaking 16 per cent.
But if the IMF thesis is right, there is every chance this recession will be more severe than the other two. There are also several factors at work that were less powerful before.
One has to do with pensions. The true scale of deficits by this time is anyone's guess, but one estimate last week suggested US corporations might have to put an aggregate $50bn into their funds in each of the next two years. In the old days the effect, such as it was, would have been hidden, not displayed on the face of the accounts.
Similarly, corporations of all kinds now have to mark all kinds of assets to market. Earnings will therefore be dented by the writedown of paper profits recorded in the bubble years.
What about valuation? Citi puts the global price-earnings ratio now at 10.4 times. And since one-fifth of the projected fall in earnings has already happened, that puts the trough p/e at 17 - bang on the long-run average.
Therefore, Citi says, the 50 per cent earnings fall it envisages is in the price. That is not dissimilar to the finding I wrote about last week, that the present p/e in the US is in line with the 10-year trailing average.
But, as I also said last week, that does not by any means imply the market has finished falling.
Equities are going through a welcome spot of calm at the moment. I do not expect it to last.
tony.jackson@ft.com
Copyright The Financial Times Limited 2008
Just an FYI from your friendly FYI poster...
I have a hard time being upset over "Hussein". It means "handsome". Granted, Americans don't give a first, middle, or last name of "handsome", but some cultures do.
If Saddam Hussein (whose mother thought he was handsome) is a rogue, then Saddam is a rogue. If we wrote it better (in English), we could (and would) say "Saddam Handsome" is actually Saddam the Ugly. Then, all press would narrow down to "handsome", rather than "hussein".
Like it or not, Obama's mom probably thought he was handsome. That's a f-a-r cry from her thinking of a Saddam-type.
JMHO
Firing a police officer for mentioning Obama's middle name is extreme, no?
There is (fortunately) a difference between what the press tries to throw down your throat and what the reader trully thinks. Publishers are on a one-way podium in that they do all the talking... and, if they talk long enough, loud enough, and with societal backlashes if the reader doesn't agree, then the readers are silenced.
Trust me, for every reader of a publication there is a different mindset that absorbs the words differently. The only problem with media is that there is no forum for the reader to hit back with the exception of rallies & elections and... uhmmm... all of which are covered by what? The media.
Thank god for the internet. The "hit" back to the media comes in the form of an open forum with one exception: no dirty words.
Now then... how better for a society to communicate than an open forum? I wonder what was said on the internet about the policeman nearly fired for speaking Obama's middle name?
When I say there is no rug, it's because the rug 'hides' things. It is free press, free thinkers, dedicated analysts who are now allowed to lay out their thoughts & research without the bitter backlash from public sentiment that has silenced them for years.
It is articles such as you posted that are destroying the "rug hiding" that has taken place & is exposing the floor for what it truly is. As long as authors are allowed to speak freely, engage in debate, seek solutions whether popular or unpopular, we have a chance to find a solution.
As they speak more openly, their tale could be far more revealing than we intially imagine... and that can be a good thing in that we will formulate a real solution based on knowing the r-e-a-l problem.
There is no rug. We're just now understanding that the Emperor has no clothes, and that the room has no rug.
It must be swept out the door. The room must be cleaned. And we start the weavers on designing the rug the way it was supposed to be.