Comments on: Tidings of a bear market rally

By: Marion TD Lewis

Marion TD Lewis — Sun, 09 Nov 2008 02:53:16 +0000

The president elect has been flirting with the idea of another stimulus check/bailout. Is that a sound idea? I wonder. No doubt this is a vicious cycle at the moment. No doubt the artificially fattened bulls will be back - perhaps even in time for Christmas. But might it be more prudent to let them come roaring back on their own, after a little sojourn in the pasture, rather than set up bait? It seems to me that when the bulls are over-fed, they just tune out and go for a really long walk (to work off the carbs, you understand?) But if folks insist on serving these beasts chemically enhanced hay, we could kill em next time.

By Marion TD Lewis, Esq. New York

By: John Dinneny

John Dinneny — Sat, 08 Nov 2008 21:10:55 +0000

Where is Washington going to find a SUCKER to loan it 3 Trillion dollars so it can spend 3 Trillion dollars more than it has? Take this overspending out of Washingtons pockets not mine. They should pay it back not my Grandkids. John

By: shoelover

shoelover — Fri, 07 Nov 2008 18:51:26 +0000

Just watch out for triple witching at the end of December……. could be some nasty margin calls and assignments

By: Peter H

Peter H — Thu, 06 Nov 2008 02:28:59 +0000

The thing that worries me is politicians with mealy-mouths, a technique perfected by ex British Prime Minister Tony Blair (he distracted the entire country for more than half of his tenure with his “Anti Fox Hunting” campaign whenever an important issue reared it’s head… now the politicians have “Climate Change” to trot out as a distraction), which permits the unsustainable antics of the last decade or so to be viewed as purely opportunities rather than potential risks, and permits our “leaders” to be seen to be doing something important… I can think of a couple of other “distractions” cobbled together during this same period as well.
For example; the by-and-large global property prices sky-rocketing, an “opportunity” to invest that could have, and should have been reined-in rather than encouraged with ever dropping interest rates; and another example being the export of industries and jobs on a wholesale basis “off-shore” which to my way of thinking robs the country of origin of jobs, hence tax and spending power but most importantly the tools to rebuilt the economy from the bottom up. What’s going to happen now? is it going to be rebuilt from the top down, maybe with marketing agencies, think-tanks, accountants, lawyers, bankers and consultants leading the recovery?

By: roberto

roberto — Wed, 05 Nov 2008 13:56:35 +0000

Let’s see how far the bear market rally travels. I will not trade in it. I will be patiently wait on the sidelines until it tops (likely January 09) and buy inverse etfs. The depression coming dow the road will be worse than the 30’s. That 800 billion is a small fraction of junk real estate paper (mortgages and insurance) that needs to be reconciled on balance sheets.

By: Peter

Peter — Tue, 04 Nov 2008 07:48:46 +0000

People seem to talk about markets like they’re some sort of living thing that you have to try to predict based on investment guru blather. They aren’t. The stock market is simply a collection of company stocks that are available for sale which are competing with bank accounts, bonds, gold, houses, cars and hamburgers.

If you take the Warren Buffet approach, you totally ignore where the market is and buy a company based on its current valuation and future profits. This seems to work given Buffet’s success.

And if you extend this to the rest of the market, it’s hard to see how profits over the next five-ten years can justify current valuations, given that you can buy corporate bonds yielding 15-20%. Or 70% if you are willing to bet on Ford.

So until individual companies look like they can make at least a 20% return in the coming recession, they’re not attractive investments. Given that profits are starting to plunge, it looks like we’ll need a trailing P/E of about five before stocks start to look attractive vis-a-vis bonds. In the current environment, that looks to be about 30-50% south of where we are now.

And another point, Seer2008, Americans can only be hard working when they have jobs. And right now, the number of hard working Americans with jobs is declining so rapidly that I can’t see them working their way out of this recession in a hurry.

By: Seer2008

Seer2008 — Tue, 04 Nov 2008 01:43:03 +0000

Lord knows we’re due for a bottoming out in global markets, and since Bernanke’s handling of the crisis in short-term lending markets will soon bear fruit, who can say the current recession will not be short-lived? America is a rock, and Americans are the hardest working and most optimistic people in the world—we can’t lose!

By: L. Schaffer

L. Schaffer — Mon, 03 Nov 2008 20:34:06 +0000

The unprecedented wealth of Americans, over the last 50 years, has lead to a cultural decline in which the true value of anything (ie: material, stocks, activities, relations, experiences, faith, philosophy) is lost in marketing/media hype, commercials, distortions, distractions and reductions to soundbytes. We no longer know the true value of anything. We no longer understand what is required of us to obtain that which is valuable. We no longer grasp that all our actions have consequences and that there is no such thing as a “free ride” or individual solution that ignores the common good. Our great wealth has allowed us to place image over substance, quick fixes over long term solutions, “me and mine” over the common good, and fantasy and escapism (drugs, TV, videogames, etc.) over personal development and interpersonal interaction. We have made bad decisions, or no decisions and allowed the unscupulous and uninformed to “run things for us”, while we were diverted with “things” without substance and pursuits without lasting “value”. Now, we Americans find ourselves divided, disconnected, incapacitated, disoriented, stunned and bewildered by the consequences of our actions/inactions. We look for a quick fix. We look for someone/something to blame for the reality of an economic crisis which has yet to deliver its hardest blows. We still deny the demands for personal education, responsiblity and involvement in a government whose stated purpose is “to provide for the common defense, promote the general welfare, and secure the blessings of freedom for ourselves and our posterity” (preamble to the US constitution). Our government doesn’t work when the majority of our populace put “me and mine” at the expense of the common good. Our government and economic system don’t work when the majority of our populace don’t know about what’s going on and don’t get involved in what’s going on. Our economy doesn’t work when the majority of the populace is trying to get something for nothing or demanding inflated wages for poor work. Our economy doesn’t work when the majority of our populace spends more than they can afford and lives above their means. Who is responsible for this financial crisis? We are. There is no one big, bad individual, group, or entity which brought us to this place. We are all complicit, whether by comission or omission. Who will help us out of this crisis? With God’s help and guidance and a commitment to what is true and valuable in our nation and in ourselves, we will. God won’t do it for us, we must take responsibility and do it our part. How long will it take? We will decide, by the length of our denial or by our commitment to do what it takes to made things better. How hard will it be? It most likely inversely related to amount of decadence which has gotten us to this point.

By: Dan

Dan — Sat, 01 Nov 2008 04:10:30 +0000

What the world should do at this juncture or in the past is to leave the US to do it’s own house keeping, the way in which the world left Japan alone for 15 years. Asian growth is key to this very fragile market place but let’s stick to this trend. Use the Mass Media to drive up confidence in Asia/Europe and CIS. A sick patient needs rest and that is what we should encourage as physicians to the ailing US economy.

By: Gary Leeper

Gary Leeper — Thu, 30 Oct 2008 12:17:53 +0000

I asked a year ago what it was about the track record of the Fed/Treasury/Congress combine that recommends them as stewards of anything, and I am still asking. Somehow Paulson and Bernanke appropriated the ability to take a huge share of the world money supply and gamble it into the biggest Black Swan/ Minsky moment we have ever seen, based on an academic study and experience at a firm that gave us the term “quant”.Nobody has experience or models to deal with the leverage and deficits we have created so sure we are going to have market volatility while the great ones experiment with our future. We all know that the leverage and deficit spending are the root of this problem, so where is the new thinking and leadership that deals with the problem instead of the symptoms?
I liken what is going on now to treating alcoholism by increasing the supply and lowering the price of booze.Let’s get out of this crisis management mindset before we turn it into an infamous phrase.
Let’s also get away from letting sitting politicians and candidates set the issues. By focusing on polarizing right /left issues like taxation and abortion, we take our eye off the ball and let the important issues like deficit spending get pushed off into the background, which is exactly where the creators of the problem want it.