Replies to post #32641 on Zeev's Turnips Patch-No Politics (ZEEV)

[marvin1946]

augie,
The market peaked end 99/early2000. 3 years a la 1929 is about up. The fact that valuations are still high historical has to do with interest rates being so low. How long will folks be willing to buy money market yields of 1% or bonds at historically high prices. If no depression as you and zeev both agree, sideline money will come back as recovery becomes more clear--first very slowly and later in torrents. Thats the cyclical bull zeev talks about. At least thats what i hope for. marv

[otraque]

<<In short, I agree that there is no "Great Depression II" on the horizon, but I do not think that fact precludes this bubble deflation from being like that of 29-32.>> For sure.
In 74 and 82 the SPX briefly collapsed to evaluations of 7-1, and there was no Great Depression. If this market were to have a dive point to SPX 7-1 , we will have achieved virtual 29-32 levels of collapse and a Great Depression need not(neccesarily) occur with such a circumstance, a simple slow modestly recessionary leakage is all that be needed,imo..
Max

[John126]

Augie-BKX predicting?

It looks like a BKX breakdown below 600 would predict your possible scenario.

http://finance.yahoo.com/q?s=^BKX&d=c&k=c1&a=v&p=s&t=my&l=on&z=m&q=l

I would not expect a slow selloff if the 600 level is lost

Concerns about corporate credit, consumer/mortgage credit got it to here. Is there a failing lender out there somewhere?

I admit I am clueless to what can start us up. Where I work (large chemical co)there is lack of demand and overcapacity- sound familiar? Our cost cutting is getting ready to go deep into the white collars. I expect other companies are having the same discussions.

[mlsoft]

"In short, I agree that there is no "Great Depression II" on the horizon, but I do not think that fact precludes this bubble deflation from being like that of 29-32."
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augie...

Good post - I agree.

That does not mean that this market will be an exact repeat, since all markets are unique with their own surrounding dynamics. It just means we still have a good way to go.

mlsoft