Replies to post #346018 on SPDR S&P 500 (SPY)

[Robbinhood101]

Cool

[Wishthiswasmyjob]

Excellent Post -
Thanks...

and there's many, many different sparks that could drop into this Powder keg room to start a solid selloff.

We already know many sparks have already dropped in, just like occurred 20 years ago and also 13 years ago, but at some point, one of the sparks truly acts as that single piece of straw that breaks the camel's back.

We can also see in the charts how long it took for the market to "get ugly"... How long it took, even after everyone was aware, for reality to set in, for the denial to stop and the downward action to take hold.

If you recall, everyone knew there were time bombs, and then even after the fact, the ratings agencies were critisized -
What took you so long ?

Housing

As of February 2008, Moody's had downgraded at least one tranche of 94.2% of thesubprime RMBS issues it rated in 2006, including 100% of the 2006 RMBS backedby second-lien loans and 76.9% of the issues rated in 2007. Overall, Moody's hasdowngraded 53.7% and 39.2% of all of its 2006 and 2007 subprime tranches,respectively.
As of March 2008, S&P had downgraded 44.3% of the subprime tranches it ratedbetween the first quarter of 2005 and the third quarter of 2007. This included 87.2%of securities backed by second-lien mortgages.
As of December 2007, Fitch had downgraded approximately 34% of the subprimetranches it rated in 2006 and in the first quarter of 2007. In February 2008, Fitchplaced all of the RMBS it rated in 2006 and the first quarter of 2007 backed bysubprime first-lien mortgages on Ratings Watch Negative.'

IMVHO, we won't see a denial of problems for months....
This time, everyone is aware and everyone is itchy.
This downside will be as fast as the covid drop -
when it happens