El Presidente Posted January 22, 2008 Posted January 22, 2008 "A member" very close to us all had a tough day yesterday on the markets. With his main computer still in the shop he is existing on his laptop with a mobile broadband connection .....which he can only connect to by leaning over his (well known) deck at full stretch ;-) With market plummeting yesterday.....he tried to sell some shares while at full stretch 6 metres off the ground and operating on tippy toes His online trading account service closed for a portion of the day as margin calls overloaded the service. Our member...lets call him "Ken" may have lucked out as unable to sell shares yesterday (spoke to him at 4pm)...the market has re-bounded 225 points in the last half hour. He will take full credit. A Warren Buffet of our times :-D
CIGARHead Posted January 22, 2008 Posted January 22, 2008 » With his main computer still in the shop he is existing on his laptop with » a mobile broadband connection .....which he can only connect to by leaning » over his (well known) deck at full stretch ;-) » » With market plummeting yesterday.....he tried to sell some shares while at » full stretch 6 metres off the ground and operating on tippy toes » » His online trading account service closed for a portion of the day as » margin calls overloaded the service. Let me guess, he was overloaded with Technology stocks
First Lady Posted January 23, 2008 Posted January 23, 2008 » "A member" very close to us all had a tough day yesterday on the markets. » » With his main computer still in the shop he is existing on his laptop with » a mobile broadband connection .....which he can only connect to by leaning » over his (well known) deck at full stretch ;-) » » With market plummeting yesterday.....he tried to sell some shares while at » full stretch 6 metres off the ground and operating on tippy toes » » His online trading account service closed for a portion of the day as » margin calls overloaded the service. » » Our member...lets call him "Ken" may have lucked out as unable to sell » shares yesterday (spoke to him at 4pm)...the market has re-bounded 225 » points in the last half hour. » » He will take full credit. » » A Warren Buffet of our times :-D Oh I so wish I was there with a camera :-D That would have been gold to capture
jdbrown Posted January 23, 2008 Posted January 23, 2008 Dont panic, dont sell but keep a keen eye..relish the bloodbath and buy, buy, buy
cvm4 Posted January 23, 2008 Posted January 23, 2008 A grossly oversold market. Don't be like normal investors, buy low and buy low again.
habanablue Posted January 23, 2008 Posted January 23, 2008 Tying to offload Telstra and Air Pacific shares no doubt!:-D
Ken Gargett Posted January 23, 2008 Posted January 23, 2008 where do you get this? granted that when using the mac, i need to lean out to connect, not so the laptop, another reason all macs should be used only as anchors, but the rest is complete and utter fiction. normally your lies have a kernel of truth but today???? you are the evil spawn of hans christian bending both the brothers grimm over. unbelievable? now, if you'll excuse me, i'm off to the tennis for the evening - can't be a late one as have to get across to adelaide early for the first day of the cricket. a wine writer's life is never easy (and the only reason you posted this lying crap was because you thought i would not be checking the forum for a few days).
csgrip Posted January 23, 2008 Posted January 23, 2008 » You guys crack me up. Here in the states, we are looking at the strong possibility of a recession. The sub-prime fallout will be felt around the world given the popularity of these neatly packaged and highly touted CMO's. The shakeup we saw around the world markets on Monday are a clear indication that no one is sure of how big this sub-prime problem stretches. Not until a true "cleansing" occurs and no doubt more write-downs from the money center banks will this market begin its climb back to the black there...my .02
tigger Posted January 23, 2008 Posted January 23, 2008 In addition to the subprime mortage/CDO issues, I believe that there's an additional drag to come from credit card defaults. The construction/real estate sector, which has been a bright point for the US economy for quite some time will be soft for another year or more IMO. I wouldn't be surprised if there were increased defaults in borrowings in tiers higher than subprime as well. It concerns me the the Federal Reserve used a considerable portion of its powder yesterday (in the form of a 75 bp rate cut) in response to equity market conditions instead of waiting to see how the broader economy is faring. I would not be an eager buyer of shares right now.
zuma Posted January 23, 2008 Posted January 23, 2008 » It concerns me the the Federal Reserve used a considerable portion of its » powder yesterday (in the form of a 75 bp rate cut) in response to equity » market conditions instead of waiting to see how the broader economy is » faring. » » I would not be an eager buyer of shares right now. I reckon that we will see at least another 2% cut by the US Fed well before the end of 2008, and a deluge of cheap money for the banks... inflation is the least of worries currently (as long as it is kept below 5% pa) and, sooner rather than later, government expenditure in the war effort will be questioned... yesterday's cut by the USFed was a sign of cojones (that they failed to show in the previous cut)... interesting times ahead! Oh, and Watch the gold price! ;-)
habanohal Posted January 23, 2008 Posted January 23, 2008 Alot of people dont like my views on this. I hope the market keeps falling lower.In the housing industry ( flooring ,I do) when market crashes, buisness picks up. It has followed this tred for the past 12 years I dont forsee houseing industry getting better till values go way down. People can afford anything these days for increases are killing us all. You still make the same amount of money each year, though inflation keeps riseing. % years ago houses in most subdivisions could be had for 140 k or so. Thoses same houses today start out at 300K+ sorry for ramblin on , but not much else to do when not workin and sittin at home
Loki Posted January 23, 2008 Posted January 23, 2008 » normally your lies have a kernel of truth but today???? Sounds like this kernel of corn has been processed already. Arggg the sub-prime mortgage fall-out , the credit crunch, and the stock market volitity is screwing the people who are fiscally responsible. Who's to blame? The bottom feeding mortgage companies, The American that can't wait untill he has the money( ie. instant gratification, refinancing and taking out all or most of home equity) or our Corporate run government ? Probably all of the above. But... Every cloud has a silver lining, For those of US that are responsible and in good financial shape there are buying opportunities in the market and real estate. Just my 2 cents.
Ken Gargett Posted January 23, 2008 Posted January 23, 2008 » » But... Every cloud has a silver lining, For those of US that are » responsible and in good financial shape there are buying opportunities » in the market and real estate. » Just my 2 cents. i think that there will be some huge buying opps for the long term. if only i hadn't wasted all my money on those glorified weeds rob sells!
zuma Posted January 23, 2008 Posted January 23, 2008 » i think that there will be some huge buying opps for the long term. if » only i hadn't wasted all my money on those glorified weeds rob sells!
El Presidente Posted January 23, 2008 Author Posted January 23, 2008 » I reckon that we will see at least another 2% cut by the US Fed well » before the end of 2008, and a deluge of cheap money for the banks... » inflation is the least of worries currently (as long as it is kept below » 5% pa) and, sooner rather than later, government expenditure in the war » effort will be questioned... yesterday's cut by the USFed was a sign of » cojones (that they failed to show in the previous cut)... interesting » times ahead! Oh, and Watch the gold price! ;-) 0% interest rates did not stimulate the Japanese Consumer over 10 years. The Japanese bubble burst but unfortunately the bad debt issues were covered over and not addressed. It simply prolonged the recession. Now the US consumer is not the Japanese consumer. The US Consumer "consumes" like no other (although Aussies are close behind). I assume 90% of the American Consumers meet their payments and purchase Responsibly. Low interest rates will no doubt be a boost for business and consumers and a 2nd quarter rebound at ground level appears to be on the cards. Yet you have an inflation snake fueled by the recovery, which will grow stronger via $100 USD Oil (again) and a weak US Dollar. In the interim people will suck up debt and spend. Come mid 2009 5% inflation may seem like a Godsend. Fed Reserve raises rates to counter the No 1 threat. The mild property recovery collapses as does equities and you are back in the same hole but worse as it will capture a greater number of consumers stimulated to take on debt in 08. At some point in time a true cleanout of markets (property, equities and complicated Debt structures) will be required. The longer it is left the worse it will be. Where we stand today in the equities markets, 2007 gains have been wiped. Look over since 2003 and it is not a big deal even if another 1000 points go in the short term. It may be cleansing and beneficial. I would have to say that I am in the corner of those (few) who would rather see a good correction now as opposed to one in 2009/10 This is not specifically a US centric problem. European property prices are falling. Housing slowing. 18 months-2 years behind the US cycle. I am guessing in OZ we are 2 years behind also. Consumers have record debt. Interest rates increasing to curb inflation. Structually full emplyoyment and a Govt about to pump 30 Billion dollars through tax cuts into the economy to fuel inflation some more. The reliance upon monetary policy almost exclusively as a blunt instrument to accelarate or decelarate an economy is a crisis in itself. It appears that governments globally are incapable or scared to use appropriate fiscal policy.
Wiley Posted January 23, 2008 Posted January 23, 2008 » » » » But... Every cloud has a silver lining, For those of US that are » » responsible and in good financial shape there are buying opportunities » » in the market and real estate. » » Just my 2 cents. » » » i think that there will be some huge buying opps for the long term. if » only i hadn't wasted all my money on those glorified weeds rob sells! Good companies on the cheap!
Loki Posted January 24, 2008 Posted January 24, 2008 » » i think that there will be some huge buying opps for the long term. if » only i hadn't wasted all my money on those glorified weeds rob sells! :rotfl:
Loki Posted January 24, 2008 Posted January 24, 2008 Rob, I was looking forward to your response on this issue. Interesting and informative insight. The assumption that 90% of Americans meet their payments and purchase responsibly may be true but I read somewhere that 1 in 6 Americans live paycheck to paycheck with absolutely no savings for the inevitable rainy day.
El Presidente Posted January 24, 2008 Author Posted January 24, 2008 » Rob, I was looking forward to your response on this issue. Interesting and » informative insight. The assumption that 90% of Americans meet » their payments and purchase responsibly may be true but I read somewhere » that 1 in 6 Americans live paycheck to paycheck with absolutely no savings » for the inevitable rainy day. I don't think that 1 in 6 figure varies greatly in any developed economy. Good people struggle to make ends meet. Making ends meet is a joy in itself. Unfortunately you can go from making ends meet to requiring serious assistance very quickly. The US represents 25% of the worlds GDP (down from 32% in 2000) and the consumer makes up 75% of the US economy. It is no wonder that the overseas markets shake at the thought of a US recession. We look to the Chinese monolith as a saviour/buffer against a US downturn and they have been the backbone of the Australian ecomony (commodities). Yet the Chinese have ploughed billions into Mongolian coal mines and now their own Nickle/Zinc/Copper mines in South America and Africa albeit mostly through JV. They realise that they need to be more self reliant on the core materials for growth. Before the current market schisms really took shape, CEO of Rio Tinto predicted commodities to come off 15% in late 2008/2009 due not to a decrease in demand but an increase in world supply (excluding copper). That spells interesting times for the Australian economy particularly if the US goes into a sustained recession. 15% drop in commodities could easily become 30% or more. Everything right now is finely balanced. What is the benchmark world currency? How will Monoline play out? Will Fed rate cuts spur recovery or simply a false dawn? Are we in Oz well covered or deluding ourselves that we are largely impervious? Is Bernanke up to the task? How independent is Chinese growth from world tremors? Is the US consumer mortally wounded or simply maimed? Do you value stocks (good companies going cheap) on what they have done or what they are experiencing financially now? Are we experiencing the tail end of a nasty thunderstorm.....or are we in the eye of a cyclone? Interesting times indeed ;-)
Ken Gargett Posted January 24, 2008 Posted January 24, 2008 » » 0% interest rates did not stimulate the Japanese Consumer over 10 years. exactly and the problem is that if we slice the rate to zero or thereabouts and it doesn't work, absolutely nowhere else to go and huge problems.
tigger Posted January 24, 2008 Posted January 24, 2008 » I would have to say that I am in the corner of those (few) who would » rather see a good correction now as opposed to one in 2009/10 My tent is pitched there as well Rob. Sadly, most governments aren't capable of seeing beyond the next election cycle, and would rather slap a Band-Aid on festering wound rather than let it drain. Your insights about China seem to me, quite valid. It has also occurred to me over the past few years that some day in the not too distant future, the citizens of the PRC may become prosperous enough that US consumers become much less relevant to the Chinese economy because internal demand for goods and services will be so great. That kind of self sufficiency doesn't bode well for the USD, nor for Washington's ability to borrow in a cheap and relatively unlimited fashion. I'm an unabashed free-trader, but we'll have no one but ourselves to blame if our hunger for lots of cheap stuff over the last few decades comes back to bite us in the end.
zuma Posted January 24, 2008 Posted January 24, 2008 » I would have to say that I am in the corner of those (few) who would rather see a good correction now as opposed to one in 2009/10 » » This is not specifically a US centric problem. European property prices are falling. Housing slowing. 18 months-2 years behind the US cycle. Hmm... I do like your insight. Though I do not agree with "the need for a big correction" viewpoint... IMO, and given that the players in the markets tend to behave like a herd, a big correction is likely to lead to a global meltdown akin, or even worse, than the 30's (because there are more things going wrong now than in the 30's... even the possible stimulus that a war could bring due to government expenditure is spent). IMHO, a big correction a-la 30's, would lead to an economic implosion: more foreclosures and massive write-offs, an explosion in unemployment and, shortly after, crime... it can lead to collapse of banks, hedge funds and large businesses (and with it the pensions/retirement-funds of the boomer-generation)... I reckon that it would end up in a global convulsion that could last at least a decade. Though it appears that the US Fed is trying to arrest a recession, I believe that they can only hope to achieve a gradual economic contraction (a less than three year recession and bear market)... significant rate cuts could reduce the number of future foreclosures (with new reset dates approaching) and could enable US manufacturing to be more competitive (unfortunately not with China 'cause their currency is virtually pegged to the greenback), and hopefully avert an explosion in unemployment. One would hope the US consumer spending would be more moderate, though the inflationary role of the oil price is the dark horse... Interesting times indeed...
TexaSmoke Posted January 24, 2008 Posted January 24, 2008 » Dont panic, dont sell but keep a keen eye..relish the bloodbath and buy, » buy, buy Very true
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