Replies to post #80267 on Zeev's Turnips Patch-No Politics (ZEEV)

[mish]

ml, if you are a bear, you may want to start being a little more cautious, consider the following thesis, with consumer confidence already hitting a 10 years low, how much lower can it go? The same with bookings in the semi equip, how much lower than $750 MM can it go (sure, why not $500 which was the low two cycles or so ago, but not too likely with a capacity base twice as large). I am not bullish here yet, since I don't have enough of a panic and "sell everything" type psychology, I am still waiting for Maria to announce that the only way to make money is going short.. but once this thing develops enough of an extreme, it could run up furiously...

Zeev

This sounds like you are beginning to doubt the Nassacre?
Comments?

M

[was Steve]

Hi Zeev,
Just saw this long term chart on consumer confidence. Since you are discussing it i thought i would post a link.
steve

http://www.ttrader.com/mycharts/display.php?p=10001&u=skinowski&a=Wave%20etudes&id=356

[zerofinance]

Zeev, that makes a lot of sense, I think in an earlier post you said that once we get to the 6000 Dow or 950 Naz area, there is a good possibility of a cyclical bull.

But not before that, right?

Zerofinance

[punkle]

In edit, looks like you just responded to this but feel free to provide any more detail on the technicals.

Zeev, seems we are still in Phase 1 of GN-03. Are you saying we may not even complete Phase 1 without a powerful bull up?

First time in a while we see you potentially getting bullish or the turnips are giving mixed signals. You mention some fundamentals in your post but are your technicals giving you bullish signals? Internals still bearish?

thanks

[mlsoft]

Zeev...

I certainly agree that the markets can have furious bear market rallies, and they come with or without outside help although we have not seen one yet that did not have help, in my opinion.

But you ask how much lower can consumer sentiment go when it is at a ten year low - that takes us back to 1993, not even in a bear market much less in one of the worst we have ever had. And most folks would not even say that we are in a recession. I would guess from those observations that consumer sentiment could drop a lot further - maybe even cut in half. I think we are headed straight into a consumer led recession that will not end until about the time everybody in the market sees little hope.

The same is true for the equipments - I think they can easily surpass the old cycle lows because we have not begun to see the worst of the recession. I expect some equipment companies to fail, and others will be taken over - that is what is needed for the sector's health, and the same is true for the chip sector and other tech sectors.

I am obviously a bit more bearish than you, especially for the economy as a whole over the next year or so. We seem to be in basic agreement, though, that it will take more than a short time to get over the bubble both for the markets and the economy. We will have short, sharp rallies but Maria declaring that short selling is the only way to make money merely signals short term bottoms. When Maria throws up on the set and Abbey resigns to become a nun, we will be getting close to "the" bottom.

Just my opinion, though - and I'm no virgin at being wrong. Not even this week.

mlsoft

[podstock]

zeev, lol. I remember once, Maria, in exasperation, declared that perhaps we all should be shorting in order to make money in this market.

and the market promptly skyrocketed the next day, lasting a few weeks --- a vicious bear rally.

[Dances-W-waves]

I listened to our local talk show host, who is a financial advisor, yesterday afternoon while making deliveries. He mentioned the last time the consumer confidence number was so low, and the times previous to that, the market was at, or near a bottom.