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I think a 10%+ selloff is a reasonable expectation. I also expect the market to be up at least another 2-3% before it happens. No way it keeps going up at this pace for much longer.
Was he wrong when he said stocks were overpriced in 1996? He may have contributed to the greatest stock bubble ever back then, but at least he acknowledged there was a bubble and also warned of it. So I dunno, maybe now he's become senile in his old age and can't recognize it, or maybe from a PE perspective he's correct. He's not the first person that has brought this up before, from a PE perspective stocks are undervalued especially in this climate of free flowing cash. Interestingly, Jeremy Seigel has said the same thing. And you know what, he was also screaming stocks were overvalued and warning of a huge meltdown in 1999. I give more creedence to the guys that can call it both ways when they see it then permabears or permabulls that keep making the same, tired old predictions that are always wrong.
So there will be PE expansion I have no doubt. But will it be through stock appreciation or earnings decreases? Time will tell.
For your reference:
http://www.multpl.com/
Greenspans says that stocks are still undervalued. I think you guys that keep trying to short this market are going to keep enduring pain until this all plays out. I've been the biggest bear on the long term economy but going against the freight train is not financially healthy to say the least. I still maintain we will top on or around April 1st.
http://www.nasdaq.com/article/greenspan-says-stocks-are-very-undervalued-20130315-00291
Nope. Just the usual...QE. Nothing to see here, stay the course. Though there will be a decent pullback soon, but I'm not changing much til it starts. I did sell all of my MCD today. Highly overbought and a big gap-up today. I'll re-enter on a pullback, but the way things have been going the last couple of months MCD will probably just keep going up.
Why do you keep shorting?
Don't expect copper to do anything but go down (along with steel) now that China RE bubble is bursting. This is starting to kill demand.
How apt, black monday on april fools.
I've been watching closely for the blow-off top since the beginning of the year. Quite frankly I'm surprised it's gone this far. I suspect you're correct and we are within 1-2 weeks of it. Historically in huge bull runs, the very beginning of April has marked a several month top. My guess is Monday April 1st for the intermediate term top...how's that for predictions?
I agree. The $10,000 questions is how long will it continue before it bursts
It does invalidate it if the time frame is completely off. And worse, it becomes very harmful to those that believe it to be gospel. Not only those that have been hurt by remaining short, but also those that have missed great opportunity to build wealth in the past 3 years.
Then what's the point of the system?!! Sorry I'm a bit rambuctious today.
System says to stay long, gut says short. gut is usually right
I give no more creedence in that than any other prediction. But at least 3% is more likely than a 40% move.
What I'm saying is in hindsight the doom and gloom predictions have been wrong for a very, very long time. One of these days somone is going to get it right. But not because they know something, but rather the luck of the draw. At any given point in time there is always someone calling for complete catastrophe. The guy that calls it out just before it happens will look like a genious, but that's far from reality.
What's the old saying, "when the last bear throws in the towel..."
Agree, this is a good observation.
Great minds? Seriously guys? I appreciate we all think the economic future looks bleak. But these predictions have been worthless...actually disastrous and downright harmfull to anyone that thought they were "great" in the past 3 years.
Not really interesting at all. This is the same ole drivel zero hedge has been spewing for the last few years while the market keeps going up. How is this article any more interesting then the rest of their worthless predictions?
But aren't we rallying today, Feb 26th?
Like I said, the selloff was just a small reactionary blib to the feds rhetoric of possibly removing the punch bowl. But no one buys it. It's back to status quo now.
They are already past the point of no return just as we are with the fiscal situation. The fed cannot stop QE for the same reason the republicans will not allow sequestration or any meaningful cuts. At this point if you do any of these, they will reak havoc on the country. They should have thought about and acted on all this long ago.
The negative news was yesterday which was the fed notes saying they may not continue QE. That's about the worst news for the market and why we saw the biggest sell-off of the year. But again, that news is going to be quickly dismissed as non-sense.
Well this is in stark contrast to what was released in the fed notes yesterday. So these guy can't even agree on what it is they want to tell the public. But like I said, forget all the words and watch the actions. There will be no backing off of QE.
Don't believe it for a second. The fed is just trying to pull in the reigns on the bubble it's creating by trying to talk it down. The market never falls for that very long. You will have to see some real follow through on stopping QE before the market has any kind of real sell-off. But of course there is no way QE can ever stop because it will cause a collapse. The fed knows this, but they have painted themselves into a corner so they can talk all they want, let's see what actions they really take.
Well the fed is buying about 80bil in bonds per month. What percentage of the entire inflow is that?
Exactly. jumanmi, you've got the tail wag the dog. As long as the fed keeps buying bonds this will keep the artificial demand high which in turn keeps rates low. That's the entire purpose of the QE. Keep buying U.S. debt with printed money.
Nope. There's no paradigm shift. History repeats itself. It always does. The longer it goes up, the more dramatic will be the selloff. But, you have to wait for it.
Buying in oversold uptrends, crashes, and shorting in overbought downtrends is all I ever do any more. I don't feel like I need to trade on any given day and wait for the right times. This, for me at least, has worked way better in puting coin in my pocket
You may think it's a joke. But here's the real funny part. Anyone that did just hold their nose and bought the s&p back then at 1290 would have made a rate of return of almost 4% on their money, while perma bears that shorted at 1290 and thought the market was going to go down forever are underwater. Strange but true.
HD is right. The only thing you need to know is the chart that rotor posted. It's been exceptional at predicting the market direction.
Well I know you're being cynical here but if it was that easy just go long and make money.
Ya I would never touch any of the miners. If you want metal exposure and don't want to buy the metal, the ETFs are the best bet.
He was around for a bit when the board first moved over here from CS but hasn't been around since. Kind of too bad because I miss his insight. Hope he's OK and doing well. Not sure whatever happened to smoothshot either.
rediculous maybe...but one of the most predictable in a long time which makes for some easy pickin's.
This is the only chart anyone needs.
There you go being obtuse again...is that intentional? No one on the board cares what you do. You want respect ON THE BOARD, stop stroking you own feathers and EARN RESPECT ON THE BOARD. In the future I'll be sure to spell things out more clearly for ya.
You sure spend a lot of time here trying to command respect. Why not just post something useful and earn it?
Well you don't want all that nasty guberment over-regulation to get in the way of BAs business do you?
I'm seeing more of this. He's not the only one. The market has obviously gone too far too fast and is long over due for a multi week pullback. I think at least 15% is needed for a good shake out. I've been sitting on more cash than I have in a long while now.