Sunday, June 27, 2010
6/28/10 Reelin' In The Years/ The best minds
You been tellin' me you're a genius
Since you were seventeen
In all the time I've known you
I still don't know what you mean
The weekend at the college
Didn't turn out like you planned
The things that pass for knowledge
I can't understand
http://www.poets.org/viewmedia.php/prmMID/15308
"I saw the best minds of my generation destroyed by madness, starving
hysterical naked,
dragging themselves through the negro streets at dawn looking for an angry
fix"
If some of the best minds in the trading business can't get it right, what does that mean? Personally, I think they will eventually all be right. We need a serious retest of the '09 lows, IMO.
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2nd_ave: I can understand your strategy of not trading the market until it gets really oversold. But in the meantime, there are a bunch of other instruments that have a very low correlation with S&P: UNG and SGG are the ones we have discussed here. Why not trade them in the meantime? Both of them already had spectacular collapses and seem to be at the beginning of the new uptrend -- a perfect time to buy, I think...
ReplyDeleteRecall the 'flash crash' came out of nowhere and caught everyone by surprise.
ReplyDeleteI don't care where they lay the blame for that crash- the next (extended) crash may unfold exactly the same way.
David- I might look into it, but for now I'm actually enjoying time away from watching the ticks. There are two goals- (a) maximizing profits and (b) minimizing losses (capital preservation). Right now I'm more focused on (b).
ReplyDeleteI suppose by definition all crashes must catch us unprepared, or they would o/w not occur.
ReplyDeleteJohn Mauldin said wrote in his latest piece on Saturday that the chance of recession in the next 9-12 months are minimal, but they rise to more than 50% (in his opinion) in 2011 when the tax increases come into effect. If that is the case, then why is ECRI WLI growth index is ALREADY at -6.9%? The negative effects of tax increases can only appear in the economic data with some lag AFTER they are enacted, i.e., starting in the 2nd half of 2011. So what's happening now? Everyone is saying that the current economic data is still reasonably good. So maybe WLI index, is having only a temporary dip and will soon start rising again, putting a positive pressure on the stock market?
ReplyDeleteTo answer my own question, John Mauldin mentions that ECRI WLI growth index has become unreliable lately, as it rose to 25% in April. A more reliable indicator, he suggests, is the ratio of export price to import price, which fits the GDP data just as well (leading it by 1 year) and that currently suggests a 0% growth ahead of us.
ReplyDeleteThere is also a Consumer Leading Indicator at http://www.consumerindexes.com/index.html, which currently suggests -2.5% growth in 6 months. So ECRI WLI is not alone in pointing to troubles ahead.
The housing sector is currently heading down, and it looks like the majority is, once again, expecting the downturn in housing to be self-contained. Well, we know how "contained" it was in 2007. So the drama is slowly unfolding, once again, right in front of our eyes...
Two articles related to ECRI, happy reading if so inclined.
ReplyDeletehttp://yelnick.typepad.com/yelnick/
http://www.zerohedge.com/article/ecri-leading-economic-index-plunges-69-back-december-2007-levels-when-recession-officially-s
David- Of what value is information, even if it proves ultimately reliable, if it fails to help you make money? Let's say a particular leading indicator points down, and accurately portends a recession. What do we do? The tendency is to go short ahead of the event. What indicators fail to do is help us accurately time the move in prices. And if you time it poorly, you are apt to lose money.
ReplyDeleteA better way to use the indicator might be to move to cash, expecting the drop will come at some point. AFTER the drop, and if the same indicator starts pointing up, one can more confidently put the cash to work.
ReplyDeleteI think there is typically a time lag as momentum builds in either direction, before things get crazy, unless the movements are news event driven.
ReplyDeleteIf cash was really money, I'd agree completely with that last statement, 2nd, but its not. We just THINK of it as money. One day we will WISH it was money.
cheapy- 99.9% of the world has no interest in the things we blog about. If the world economy goes into the ----hole, I'm confident that we will at least be ahead of the curve. In the meantime, I think cash holds its value.
ReplyDeleteI see Bill has transitioned into very ST time horizons, which makes sense. How else has it been possible to make money the past few weeks?
ReplyDeleteThe USD is just the currently accepted median of exchange, it can change. Think D mark, Italian Lira, and French Franc to name a few.
ReplyDeleteEverything about the market, indicators, forecasts, guessing tomorrow's direction, gurus, deflation/inflation and the stars are about helping one formulate a plan of attack. It searching for a "Holy Grail" that does not exist.
The closest thing to the truth in the market is price, full stop as Mr. Bill Cara say.
I'll say it again, the closest thing to the truth in the market is price.
Doing nothing is perfectly rational, who says we have to play/trade all the time?
Over time almost all players are reduced to the average return of the market minus the fees they charge the gullible for thinking they know something.
Everyone can get a hot hand, but few very few can beat the market over a 20 year period. Like maybe 8 people out of six billion on the planet. It is all a delusion and ego.
What do you want from the market is a better question.
I want to make consistent gains and take dollars out of the market. If I achieve that I consider myself a success. In lieu of that goal is capital preservation period.
I think we will be fooled en masse till a breaking point, for which there will be little warning, and we will wake to our bond values collapsing and dollars worth 30% less, or maybe 50% less.
ReplyDeleteI know we think in dollars because we almost gave to. And if things were honest, we could count on that, but they aren't, and we should be vigilant both in taking preventative measures, and watching/listening for the creaks that sound before the quake hits.
In the meantime, I at least try to think in increasing nominal account values short term, but in real purchasing power, longer term.
Its not my fault. I'm just doing what I think I need to to protect what wealth I have from their printing presses.
I ask, what can be done in the event of another crisis?
ReplyDeleteCan the Fed cut to negative rates? Will our trillions in debt be paid in dollars of today's value? Not likely on either count.
No, if there is another crisis, and there always is, then the Fed will now be forced to print $$$.
So we are forced to play two games, hedge against monetary devaluation and defend against deflation of hard asset values.
Since we seem to be right on the balance point between up or down, it is probably a prudent move to sit tight and wait for a trend, instead of messing with the trading range we're in now and getting nickeled and dimed to death and frustrated. Right now the big blue arrow is pointing sideways, so there isn't much for a trend following moron to do (me) but to hold my divy payers that are relatively static and maybe throw in a trade on UNG every once in a while when it hits $7.98 for a second or two.
I feel like the one-legged man in the ass kicking contest.
I'll bet I'm like everyone else....waiting for the mother of all flash crashes to go all in on some monster divy payers and reap some cap gains, some income, and short bonds.
Until then there is scotch for my friends and rum and Guiness for me. Cheers!
Gundlach says there are six options that the fed has they are:
ReplyDeleteThere are six ways to get out of debt problem
--Increase GDP growth
--Lower interest rates on government debt
--A transfer of foreign capital (Greece situation)
--Increase taxes (Gundlach says a tax increase is on the way) or cut spending (very difficult to do, little appetite for it)
--Print Money
--Default
You can read the article for his take and expectations.
http://discuss.morningstar.com/NewSocialize/blogs/conference2010/archive/2010/06/23/gundlach-on-deflation-protection.aspx?PageIndex=1
Speaking of getting one's ass kicked- wife asked me to remove two rosemary bushes in the back this weekend.
ReplyDeleteWell, I was able to trim/clear the branches, which filled almost two of those large recycling containers.
Then I started on the roots. Using just a shovel, and by leveraging my entire body weight at times, I was able to dig one out. 3/4 of the way through the second, which is wedged in a difficult to reach space, I had to stop and sit down- no way.
I'll have to buy a pick-ax or something to finish the job.
2nd - Rosemary bush, huh? Funny, in West Texas they call a bush a tree (mesquite) http://en.wikipedia.org/wiki/Mesquite
ReplyDeleteIf the job's too big for digging with a pick/shovel and you need to get the roots and all of nearly any tree or shrub, just rent the appropriate sized stump grinder at you local rent-a-center. These are set up similar to a tiller but the blade is narrower and spins at a higher speed.
My first try at stump grinding was with a palm tree after ruining a chainsaw chain cutting it down (Palm is very rough on a saw chain for some reason) I had my doubts about the stump grinder but it made surprisingly short work of it.
Sounds like Europe isn't going to spend their way to prosperity, would it be a stretch to assume that should provide support under the Euro?
ReplyDeleteN Korea seeks $75 trillion in compensation
ReplyDelete"Cash-strapped North Korea has demanded the United States pay almost $US65 trillion ($75 trillion) in compensation for six decades of hostility.
The official North Korean news agency, KCNA, says the cost of the damage done by the US since the peninsula was divided in 1945 is estimated at $US64.96 trillion."
http://www.abc.net.au/news/stories/2010/06/24/2936414.htm
Just finished scanning all of the S&P industry reports I get every Sun. Neutral across the board.
ReplyDeleteGL with that rosemary bush. Those baby's are a mother ......
CP- I'll be sure to send my check to North Korea next Tuesday :)
So...anyone up to date on the party in Canada??
Maybe we shouldn't be too surprised to find falling T rates coming to a theater near us (and a resumption of QE)?
ReplyDelete"RBS tells clients to prepare for "monster" money printing by the Federal Reserve
As recovery starts to stall in the US and Europe with echoes of mid-1931, bond experts are once again dusting off a speech by Ben Bernanke given eight years ago as a freshman governor at the Federal Reserve."
http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/7857595/RBS-tells-clients-to-prepare-for-monster-money-printing-by-the-Federal-Reserve.html
Printing money and default are the same thing.
ReplyDeleteThe only difference is pace.
Printing money is just s-l-o-w default.
CP- I see it's a little hot in your neck of the woods. Same here. 98 and 100% humidity....In my pool :))
ReplyDeleteWonder how much longer it'll take for the 50DMA to cross the 200DMA?
ReplyDeleteMark - Yep, it's toasty:
ReplyDeletehttp://www.youtube.com/watch?v=M-qN6TCY85c
2nd_ave: the value of a good economic indicator for me is that it shows me the direction in which I should be trading: scaling in and out of ultrashorts or scaling in and out of long positions. Having survived the mother of all short squeezes between the bottom of the January correction (when I thought the market was ripe for going down and opened new short positions) and the April top, I don't fear now any short squeezes we may have during the downtrend. All I need to know, for my trading strategy, is whether the medium-term trend is up or down.
ReplyDeleteI just read Hussman's weekly market comment and he sounds VERY bearish. Some quotes are below.
ReplyDelete"Based on evidence that has always and only been observed during or immediately prior to U.S. recessions, the U.S. economy appears headed into a second leg of an unusually challenging downturn."
"In recent months, I have finessed this issue by encouraging investors to carefully examine their risk exposures. I'm not sure that finesse is helpful any longer. The probabilities are becoming too high to use gentle wording. Though I usually confine my views to statements about probability and "average" behavior, this becomes fruitless when every outcome associated with the data is negative, with no counterexamples. Put bluntly, I believe that the economy is again turning lower, and that there is a reasonable likelihood that the U.S. stock market will ultimately violate its March 2009 lows before the current adjustment cycle is complete. At present, the best argument against this outcome is that it is unthinkable. Unfortunately, once policy makers have squandered public confidence, the market does not care whether the outcomes it produces are unthinkable. Unthinkability is not evidence."
"It is interesting that despite the apparent stabilization of the Euro in recent weeks, the stabilization more reflects sudden concerns about the U.S. dollar than improvement of European debt conditions. Notice that relative to the Swiss Franc, for example, the Euro continues to plunge to fresh lows."
"Again, the historical regularity is for commodities to decline, though with a lag, once credit difficulties emerge."
I don't want to bet against Hussman. As such, I preparing to let go all my UCO if it declines below $10 again. This should put my portfolio squarely in a net short position, and hopefully I'll be able to maintain that stance for the duration of the next leg down in S&P to the 950 area.
Futures lukewarm, not particularly inspiring. Maybe that's the plan, leave everyone sitting on the fence.
ReplyDeletei just hit the bid pal 3.52
ReplyDeletebought TBT at 36.97 in pm
ReplyDeleteLong bond being bid up, TBT bid/ask at new 52-wk low.
ReplyDeleteCould be a good day for the 30-yr fixed.
GMO - Was pretty beat up last week, I'm anticipating some rebound this week.
ReplyDeleteLong bond - Mr. B must be buying gov. debt., and folks wanna get in on the action. Gotta keep the lights on in DC come hell or high water, right?
ReplyDeleteHas anyone heard if the FED is going to reduce payments on excess reserves? This might reverse the alarming money supply trend David's been pointing out.
Considering how they pulled in the reins on so many programs simultaneously, it sure seems the FED's crystal ball is awfully nearsighted. I had expected they would let the programs run until we were out of the woods. Maybe they had no choice...
Wonder who's gonna get rich off cap and trade?
ReplyDeleteSharkie - Looks like you bought 3k shares of PAL...
ReplyDeleteSold, not bought. Sorry if my terminology is off.
ReplyDeleteLandry-
ReplyDeleteRandom Thoughts:
I still think the market has the potential to challenge the bottom if its recent range--and possibly beyond.
However, I'm concerned that it could get stuck in a range.
Summertime blues?
As you know, I look at a couple thousand charts each day.
There were very few setups. In other words, the database is telling me to sit on my hands for now.
Futures are flat pre-market.
Cap and Trade question:
ReplyDelete1. The government. They will give themselves 25% of carbon credits expected to generate an amount equal to 15% of what the IRS takes in. This is wrong because almost 100% of hot CO2 comes from politicians.
2. Coal based utilities that build or partner in clean generation to offset their carbon. There is currently a goldrush for YOUR $$$$$ to build anything considered carbon neutral (whether it is or not) to garner credits to sell/trade. 30% of all project $$$ is paid by you. Fuel credits, accelerated depreciation, paid by you. Fuel subsidies paid by you (farm bill). Fed/State/local tax credits and offsets paid by....yep, you.
3. Clean utilities with nukes, hydro, solar, wind. They will get credits for free to trade.
Anyone that trades offsets.
Carbon credits: $116 billion business in 2008.
Estimated to be $2 T by 2020.
OK PAL does look REALLY good long here IF the market indexes can hold up, and maybe even if they cant:)
ReplyDeletecould today be Black Monday?
ReplyDeleteLoad up on the shorts, boys!
I don't know about an angray fix, but I did just do a bong-hit:)
ReplyDeletegold on the rise and I hope Bill is short:)
ReplyDeleteclosed TBT for $1000 profit
ReplyDeleteprobably sold too early as usual, lol
ReplyDeletebut I was up to over $1 mm at risk, and was happy to get out with $1k more than I started with this morning
ReplyDeleteI ended up quadrupling the position in low 36.90's and 36.80's, with the big buy avg in at 36.88x
ReplyDeletelol, was happy to get out with my skin, but would have done better to set a trailing stop and walking away
ReplyDeleteI keep telling myself I'm going to do that, but by the time it gets to there, I was in so deep I just wanted out with a profit. My emotions seem to control too much. I do my best to control it, but its just too much sometimes.
ReplyDeletePAL/GMO - The usual early morning selling on strength.
ReplyDeleteGood trade sharkie.
trailing stop would have hit at 37.08
ReplyDeleteit would have been about $2000 more profit had i done it that way, but could have caused a $1300 loss had it dropped more.
live and learn
WRLD has been kickin' butt again lately.
ReplyDeleteCPE making a turn?
ReplyDeleteThanks man. I have learned to not expect much from stocks this time of year.
ReplyDeleteThey're gonna fix everything (sure, and BP's gonna stop the oil leak)!
ReplyDelete"Leaders of the wealthiest Group of 20 nations showed common resolve to contain budgets and ballooning debt levels while ensuring that the global recovery remains intact."
CPE - Bounced off the lower trend line just like GMO has.
ReplyDeleteI don't know for sure but at some point PAL might catch some wind from their gold operation. Unless maybe they sold forward and can't deliver the contracted quantities. That would suck, wouldn't it?
ReplyDeleteCopper green again... I like that patina.
ReplyDeleteSpeaking of wind bags, CWS is in favor today.
ReplyDeletePLM - "Polymet Says Environmental OK In Sight For Minnesota Mine
ReplyDeleteBy Laura Kusisto
Of DOW JONES NEWSWIRES
TORONTO (Dow Jones)--PolyMet Mining Corp. (POM.T) says it's now a matter of when, not if, it will receive environmental approval for its sulphide ore mining project in Minnesota. On Friday, the company's stock is higher on the news that all federal agencies have agreed to cooperate to review the project. PolyMet said it won't know for several weeks when the final Environmental Impact Statement will be ready, nor when the mine will actually go ahead. Still, the company says the project will be approved. "It's not a question of if we get permits," said LaTisha Gietzen, a spokeswoman. "It's a matter of when." Until now, PolyMet was involved in two environmental-review processes for the project in northeastern Minnesota, one to get approval for the mine and the other to get approval for a land exchange with the U.S. Forestry Service. Combining these processes streamlines the situation and gives the company confidence all agencies are on board. Investors had been growing impatient, after no news about the project came out in more than five months. Any sign that the environmental-approval process, which began in 2004, is nearing an end is good news, said an analyst. "A long and windy road is looking like it's coming to a destination," said Barry Allan of Research Capital. "The state was taking a seemingly inordinate amount of care and caution," he said. To complete an environmental-impact review, a company produces a series of draft statements, which governmental agencies review and send back with questions or concerns. The company is now in the final stages of preparing the 14,000-page statement. The U.S. government has been cautious because the mining of sulphide ores isn't as well-established as mining iron ores. If PolyMet receives environmental approval, three companies are following close behind seeking similar approval, according to Allan. The Duluth Complex contains the world's largest undeveloped deposit of sulphide ores. A go-ahead for PolyMet "is a bit of a tip of the iceberg," he said. "It's a process that would open up a substantial amount of development." The Duluth complex is PolyMet's sole project. That's why the company's progress towards a permit is vital to its performance, Allan said. In Toronto Friday, Polymet is up 20 Canadian cents, or 14%, to C$1.58 on 364,000 shares. Company website: http://www.polymetmining.com -By Laura Kusisto, Dow Jones Newswires, 416-306-2028; laura.kusisto@dowjones.com (END) Dow Jones NewswiresJune 25, 2010 13:57 ET (17:57 GMT)"
New York Times article on that this is the beginning of the 3rd depression...
ReplyDeletehttp://www.nytimes.com/2010/06/28/opinion/28krugman.html
Bob,
ReplyDeleteAre you in the New York area?
I like Krugman but he is a beady-eyed little collectivist, one of a far-left stripe.
He advocates the stock transaction tax, raising taxes on the upper-middle class, tying the hands of Wall Street and speculators in general. While I laude some of these goals, perhaps, I find myself philosophically at odds with his radically-populist mindset. I think of myself as a leftist of a sort also, so my criticism is measured.....
I believe in confiscatory inheritance taxes on the very very well-to-do, but fairly low taxes for high-income earners.
I believe in cutting spending for "defense", itself a cruel euphamism, but boosting it dramatically for schools and teacher training. I believe that until we really re-invigorate the PUBLIC schools system we are fucked.
Bear in mind, that my left-wing friends think that I'm a right-wing market-sucking Nazi fuck, so I manage to piss off everybody on both sides of the political divide.
The only reason I am even involved in the stock market is that it's the easiest way for me to make money. I am really the LAST person you'd think would be involved in "this thing of ours:)
Krugman believes in that Carter-ewque "we all have to suffer" brand of leftism. I prefer the "let's disgourge the wealth stolen by the ultra rich fucks and let's party on their dime" type of philosophy.
Naaaa, I'm not a follower. I've been saying we are really in a depression since 9/11 hit. Its just interesting to me when the concept finally gets to the New York Times. What's really sad is that by printing like madmen and pretending all is well, the Fed and Govt have changed the setup from bad recession or depression, to a full scale imminent collapse, all the while pretending "all is well", and singing songs by the campfire, wasting what resources and opportunities we had to work our way out of the problems.
ReplyDeleteNobody likes me either, especially my Dad's cousin, the former FRB director, who tried to tell me "all was well" and "invest for the long term" back in 2007/2007.
long TBT again at 37.00
ReplyDeleteI agree with your assertion regarding the 911 "attacks".
ReplyDeleteNot often discussed is the fact that, whether genuine or manufactured internall, how successful the 911 "attack" have and continue to actually be. The "terrorists" really did "trick us" into not only surrendering our rights as individuals, but also caused Fed policy to create the very bubble (in response?) which appears now to be our downfall.
Essentially , and it shocks the shit out of me the free ride the fascist media still give Bush/Cheney, but as time passes it appears that the 911 incident was a U.S. sponsored false-flag operation designed to do what it did, by leaders with interests wholly at odds with what was left of our constitutional democracy.
Bin Laden was working for us, and the 20 hijackers were hired by him, and we never found him after ten years even though we know exactly where he is...it's inconceivable that we do not. And apprehending him is no longer discussed in the lap-dog right wing media...why would it be? He is and has always been "our guy".
With TBT now near 37 it's half what it was as an IPO 2 years ago and near the low of 35.5 late 2008. Looks like downdide is limited here. I may go in with an opening position.
ReplyDeleteSo this is an anti-"Art of War" plot?
ReplyDeleteInteresting idea Shark. Scary as hell, but interesting.
If true it makes BC look like milquetoast. We aren't even chattel if it's true.
out at 37.04
ReplyDeleteTBT, I'm with you guys (have position) but it isn't exactly tracking TLT which isn't at it's high yet TBT is at it's recent low. Just
ReplyDeletenoticing...
36.88 with a trailing stop might have been the deal today Cheapy. BUT, I wouldn't scoff at a grand either.
Things are always different than as presented.
ReplyDeleteRed close.
Stagnant/corrective market 'till mid-July earliest.
Smoking bacon while daytrading isn't easy. Missed a buy point there...
ReplyDeletere: depression, it started with the internet bubble being created/allowed and burst. I think there is a possibility that the Bush w/h either allowed or fostered or made no attempt to stop the 9/11 attack to use it as a rallying cry to start a war that they expected would allow the economy to avoid the depression. IMO, They weren't very bright, and got us into another Vietnam instead
In May, I purchased 500 shares of UCO at 11.70, then added 100 at 11.10 and then added 200 more at 10.29. Today, in order not to "let a profit turn into a loss" on my last purchase, I sold at 10.28 the 200 shares I added at 10.29. I have also placed a hard sell stop limit at 10/9.99 for the remaining 600 shares. Preparing for the long recession and a drop in commodity prices...
ReplyDeleteOne thing that destroys an economy is war. Especially a long drawn-out war with long supply lines. That Sun Tsu was a sharp cookie.
ReplyDeleteI know Bush never read it, but I guarantee the Chinese have and so did OBL. That's how they destroyed the USSR. Back in Sun Tsu's day they conquered and took the spoils of war, which enriched the victors. These days we are busy denying "empire" so the spoils take much longer to benefit the victor...if there is one.
BTW, for Shark's theory to work, Bush would have had to be totally in the dark. He's too big an idiot to be that good an actor.
ReplyDeletePS: IMO, I think depressions end when the debt that caused it is finally erased or repaid to where people are not as afraid to lend or borrow again. If my theory is true, this depression could last the rest of my lifetime. Japan being an example of where we are headed...
ReplyDeleteI have also just noticed that my sell stop order was triggered for SGG at $44.23. It doesn't want to give in without a fight. :) If it gaps up tomorrow, then I'll have to let it go. If it drops down, on the other hand, then I'll be waiting for it, once again, with a buy stop order at $44.
ReplyDeleteCPE was added to the Russell 3000. I'd be careful for a while.
ReplyDeleteFTWR- Looks like their not done Fing around with this one.
ReplyDelete"re: depression, it started with the internet bubble being created/allowed and burst."
ReplyDeleteSo Al Gore invented this depression? ;)
I believe Bush was, at least beforehand, completely in the dark. Being a fairly intellectually fellow, I have no doubt that at some point soon thereafter he did get a clue what was going on, but he was too much a part of it to do anything but start the wars he was told to start, and do the things he was told to do.
ReplyDeleteA lot was accomplished under the Bush administration. They were very, very successful.
Stink bids in for X, PXP, HEK, SD. Stink short on C.
ReplyDeleteSee you guys at the bar....
stink short. ha, that's funny mark.
ReplyDeletei see that my "stink bids" on a few stocks in mid May were eclipsed and am glad I pulled them. They included JNJ, GOOG, and a few others.
I'm still sticking by my 950 or bust and am 99% in cash.
intellectually curious.
ReplyDeleteHe knew something really really big was going on, and that he was a part of it.
No positons (yet)
Will re-buy PAL at/above 3, or on any scary drop that feels cathartic.
Ideally what will happen is the 20 day in PAL will fail decisively.
ReplyDeleteA screwdoodle down to 2.80-2.90 would feel buyable.
I'm afraid to re-buy PAL here...even though it MAY be right.
ReplyDeleteBTW, on Krugman, where I think he is REALLY wrong is that he still thinks stimulus will PREVENT the depression. I think because it will just add more debt, it will WORSEN and PROLONG the depression, and I guess the way we are spending, we should expect a complete and total collapse if my theory is correct.
ReplyDeletePeople need to learn that a small amount of debt for good reason, to buy things on the cheap, and repaid soon thereafter is ok, but a lot of debt is a very bad thing.
ReplyDeleteOur forefathers learned it, but we lost that knowledge.
PAL - I'm not buying anything unless I can lower my basis substantially.
ReplyDeleteI get the feeling the market's unhappy about something, could it be the final vote count on financial reform? I guess it doesn't matter, just watch the prices.
"I guess the way we are spending, we should expect a complete and total collapse if my theory is correct. "
ReplyDeleteYep, with no clear plans on how real jobs will be created, and a government still growing and spending like there's no tomorrow. Seems like we're moving closer to a meltdown, not further.
PXP - New target ~$18.10?
ReplyDeleteI heard talk of the Krugman article on CNBC, so expect the market is thinking it thru. That might be today's "unhappy factor". Jobs numbers on Friday will be ugly, I think. I'm expecting job losses and higher percentage unemployed.
ReplyDeleteAlso, my wife's unemployment ran out, so that means all the people that lost their jobs early in the recession are now getting zero to live on, and will not be spending going forward, because you can figure by now they have tapped out every penny of savings etc. I read somewhere that less than 1/2 got ANY job since.
I guess the stimulus borrowing and spending will continue till election day, but after that I expect the economy to go off the cliff again, and this time the govt and Fed will be going into the next leg down both already tapped out, too.
I went into TBT near the close. Price was 36.81. Hoping there is enough life in it for a nice bounce in the near future. Don't want to hold it long term because of the tracking problem and it could be a long time before the fertilizer really hits the fan with high interest rates.
ReplyDelete"Yep, with no clear plans on how real jobs will be created, and a government still growing and spending like there's no tomorrow. Seems like we're moving closer to a meltdown, not further."
ReplyDeleteSounds like the smartest thing I heard all day)
cnbc - they're talking about these debt to gdp numbers...
ReplyDeletehttp://www.advisorperspectives.com/commentaries/bespoke_052610.php
i expect all governments to print like crazy.
ReplyDeleteA falling tide lowers all boats at roughly the same rate. Didn't I hear the Prez say something at the G-20 about "we can't all pay off debt at the same time" or something to that effect?
So we have some real tension between the printers and Austerians. We are so screwed.....
So if you are wondering why this market is tanking, wonder no more. Here, this should cheer you up: http://noir.bloomberg.com/apps/news?pid=20601109&sid=atxrhPqbty_4&pos=14
ff - Governments have been printing like crazy, and the only recipients have been banks and government as far as I can tell.
ReplyDeleteWhat's been done to restore economic activity and create jobs? Not much, as far as I can tell.
Kyle, I think that article may be a little misleading: "If concerns over debt are the major issue behind the correction, emerging market countries should rebound the strongest in any rebound."
ReplyDeleteAssuming developed countries are the primary customer base for emerging markets and the economies of developed countries are coming to a standstill, where are emerging market profits going to come from?
Cramer is actually making some sense this evening. Main point is that the street is not going to pay up for earnings streams in this environment. Too much crazy stuff going on. Here's a recent post from cc..
ReplyDeleteUS Jobs lost due to environmental rules
Submitted by MoKat (167 comments) on Mon, 06/28/2010 - 17:37 #65105
Tim Sullivan, CEO of Bucyrus, told of a 1000 US jobs to be lost due to the failure of an equipment deal to a power plant complex in India. The US EXIM Bank refused to guarantee loan because although Bucyrus met the initial environmental criteria, the EXIM bank went beyond those standards (carbon impact) and squashed the deal. Bucyrus recently invested $250m in capex at their Wisconsin facility.
POTUS Obama is visiting Wisconsin next week...hope the workers boo him off the stage. Maybe Sen Feingold
can bring home the bacon and get the decision reversed. He is up for reelection in Nov.
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ReplyDeleteFTWR - Possibly this announcement today may have impacted FTWR's PPS? Wonder if the administration has plans to force spectrum holders to use it or lose it in order to free up unused frequency licenses?
ReplyDeletehttp://macdailynews.com/index.php/weblog/comments/25784/