Stock Markets Current News III (Take Three)

[careinke]

Well yesterday seems to have been a dead cat bounce. Back on track today.

[AirlinePilot]

Not sure that was a dead cat event. More like everyone was holding their breath on the QE thing.....I think we have one more medium strength rally before the big one and we go far below the lows of 08. I'd look for some form of bounce here but would not be surprised if we keep headed down to real world valuations based NOT on fantasy and huge govt injections of liquidity.

[eXpat]

Well well, another bloodbath

NEW YORK (MarketWatch) — U.S. stocks toppled again Wednesday, continuing a manic trend that has had the Dow industrials swinging 400 points each day this week. Intensifying worries about Europe’s sovereign-debt crisis had Wall Street more than erasing the prior day’s rally.
“The turmoil that now envelopes global financial markets has come upon us with a frightening suddenness,” said David Kelly, chief market strategist at J.P. Morgan Funds.
Less than three weeks ago, on July 22, the S&P 500 /quotes/zigman/3870025 SPX -4.42% closed at 1,345, up almost 7% for the year, noted Kelly. At Wednesday’s close, the S&P 500 was off nearly 11% for the year.

Treasurys climbed for a third day; bank stocks were slammed in the U.S. and Europe; the U.S. dollar gained and the euro lost ground.

The Dow Jones Industrial Average /quotes/zigman/627449/delayed DJIA -4.62% fell 519.83 points, or 4.6%, to 10,719.94. On Tuesday the blue-chip index closed with a 429.92-point gain. On Monday, it lost 634.76 points. The three-session stretch of 400-plus moves in either direction last occurred November 2008.

“Fears of a ‘repeat of 2008’ have led many individual investors to sell stocks and other risky assets,” said Kelly. But, the selloff may well be overblown, given the market has already priced in an outcome that is not yet clear. “Over the next few weeks we will get a much clearer idea about whether the economy has the resilience to stay on a growth path,” Kelly said.

http://www.marketwatch.com/story/us-stocks-open-sharply-lower-2011-08-10?dist=afterbell

[OilFinder2]

You doomers will be happy to know that I'm >this< close to becoming bearish - at least over the short or medium term.

I've never been a fan of the Euro, and a couple things I read today made me think it's probably toast. If true, the markets are *not* going to be happy as it unravels - which is what could be happening right now.

The good news is, this isn't a US issue. The bad news is, the US would be affected by it anyway. How much is the question.

[careinke]

You doomers will be happy to know that I'm >this< close to becoming bearish - at least over the short or medium term.

I've never been a fan of the Euro, and a couple things I read today made me think it's probably toast. If true, the markets are *not* going to be happy as it unravels - which is what could be happening right now.

The good news is, this isn't a US issue. The bad news is, the US would be affected by it anyway. How much is the question.

OMG it IS TEOTWAWKI. Say it isn't so OF2. If OF2 is bearish, we have reached capitulation. Time to buy.......well maybe in a little while.

[OilFinder2]

Interesting observation:

- Asian markets peaked in early November
- European markets peaked in February - with the exception of the German market which peaked in late April
- US markets peaked the same time German markets did, in late April

Not sure what that means, except that we've got a rolling series of peaks. Maybe we look to Asia to figure out when the bleeding stops?

EDIT: Just realized the Japanese stock market continued going up after November, so they're the exception to the Asian rule. They peaked in February, but with the earthquake after that it's hard to read anything into their behavior.

[kiwichick]

australian unemployment up to 5.1% from 4.9%

22,000 fulltime jobs lost versus forecast of plus 10,000

markets now pricing in possibility of interest cuts

RBA rate currently 4.75%

[americandream]

australian unemployment up to 5.1% from 4.9%

22,000 fulltime jobs lost versus forecast of plus 10,000

markets now pricing in possibility of interest cuts

RBA rate currently 4.75%

Thanks KC. Be cool if you could put your financial news on a separate thread....thats if you are doing the daily financial calendar..I find it useful.

[peripato]

The good news is, this isn't a US issue. The bad news is, the US would be affected by it anyway. How much is the question.

Well it's all just one market now Oily, if that answers your question.

[americandream]

The swiss are preparing for a flight into the swiss franc.....hmmm. This is going to get painful for the lumpenproletariat.

[peripato]

Not sure that was a dead cat event. More like everyone was holding their breath on the QE thing.....I think we have one more medium strength rally before the big one and we go far below the lows of 08. I'd look for some form of bounce here but would not be surprised if we keep headed down to real world valuations based NOT on fantasy and huge govt injections of liquidity.

I tend to agree with your sentiments here and that the real capitulation is still ahead of us. Perhaps in the October/November time frame? Until then it will be a wild ride in every market, commodity and trading instrument on planet Earth. Got Gold?

[americandream]

Not sure that was a dead cat event. More like everyone was holding their breath on the QE thing.....I think we have one more medium strength rally before the big one and we go far below the lows of 08. I'd look for some form of bounce here but would not be surprised if we keep headed down to real world valuations based NOT on fantasy and huge govt injections of liquidity.

I tend to agree with your sentiments here and that the real capitulation is still ahead of us. Perhaps in the October/November time frame? Until then it will be a wild ride in every market, commodity and trading instrument on planet Earth. Got Gold?

The markets are alternating between risk and safety and have been doing that since the end of the housing boom. I think we are seeing the start of speculative trading and the end of any form of significant investing style of holding. If I am correct, sustained volatility will characterise the new markets.

[peripato]

Not sure that was a dead cat event. More like everyone was holding their breath on the QE thing.....I think we have one more medium strength rally before the big one and we go far below the lows of 08. I'd look for some form of bounce here but would not be surprised if we keep headed down to real world valuations based NOT on fantasy and huge govt injections of liquidity.

I tend to agree with your sentiments here and that the real capitulation is still ahead of us. Perhaps in the October/November time frame? Until then it will be a wild ride in every market, commodity and trading instrument on planet Earth. Got Gold?

The markets are alternating between risk and safety and have been doing that since the end of the housing boom. I think we are seeing the start of speculative trading and the end of any form of significant investing style of holding. If I am correct, sustained volatility will characterise the new markets.

This assumes that central bankers and politicians will do everything right, now and forever, Highly unlikely since we are talking about human nature here and that doesn't change. Not even high-speed algo-trading can change it. In fact, it's symptomatic of declining marginal returns on investment and is leading the destructiveness. More likely the stuffing will hit the fan soon and we will see a dramatic decline in stock market fortunes, wiping out 30 years of excessive risk, extreme bullishness and wishful thinking. This is how all speculative bubbles end.

[americandream]

Not sure that was a dead cat event. More like everyone was holding their breath on the QE thing.....I think we have one more medium strength rally before the big one and we go far below the lows of 08. I'd look for some form of bounce here but would not be surprised if we keep headed down to real world valuations based NOT on fantasy and huge govt injections of liquidity.

I tend to agree with your sentiments here and that the real capitulation is still ahead of us. Perhaps in the October/November time frame? Until then it will be a wild ride in every market, commodity and trading instrument on planet Earth. Got Gold?

The markets are alternating between risk and safety and have been doing that since the end of the housing boom. I think we are seeing the start of speculative trading and the end of any form of significant investing style of holding. If I am correct, sustained volatility will characterise the new markets.

This assumes that central bankers and politicians will do everything right, now and forever, Highly unlikely since we are talking about human nature here and that doesn't change. Not even high-speed algo-trading can change it. In fact, it's symptomatic of declining marginal returns on investment and is leading the destructiveness. More likely the stuffing will hit the fan soon and we will see a dramatic decline in stock market fortunes, wiping out 30 years of excessive risk, extreme bullishness and wishful thinking. This is how all speculative bubbles end.

Where I differ from you is that I view economic systems in states of maturity. For example, there is no way we shall ever go back to the days of bows and arrows unless this civilisation completely collapses and even then, there will always be some reside of modernity until the last human dies. Likewise, I think speculative capitalism is with us from here out till its demise and something new rises from the ashes.

Old investment style capitalism works well in a world where things were much slower and expectations were not as immediate, with thinner competition on the ground. Gone are the days when holders of wealth wuld buy a few bars of gold and wait out a crisis. In fact, that style of wealth holding is fatal for a fund manager...it may work with high net worth individuals but not the business of managing the wealth of others which is still very significant despite stories of investors cashing out. After all, who is going to cash out to any significant degree when to be honest, no one really is sure which way things will be going and there has been no clear signal of decoupling. Which is why I reckon that the professional speculator will liquidise the market speculatively (after all its the safest way to work money that is unsure) whilst position holders will move to safety.

[OilFinder2]

OMG it IS TEOTWAWKI. Say it isn't so OF2. If OF2 is bearish, we have reached capitulation. Time to buy.......well maybe in a little while.

Maybe you're onto something.

Dow up 423

Wild week!

[americandream]

OMG it IS TEOTWAWKI. Say it isn't so OF2. If OF2 is bearish, we have reached capitulation. Time to buy.......well maybe in a little while.

Maybe you're onto something.

Dow up 423

Wild week!

Poor sods spend their every day praying for collapse when it aint gunna happen in their lifetimes. Give it some time and many will do a Savinar. How many have we had who have been predicting all manner of imminent doom in the many years I have been a member on here.

We even have a Polish fellow on here who doesn't seem to know whether he wants to revert back to some more simple life that he never wanted in the first place. Talk about confused!!

Capitalists are not going to oblige by killing the goose thats laying the golden egg. Not until they have no choice and that will be determined in the malls and workplaces, not on doomer sites.

[peripato]

Poor sods spend their every day praying for collapse when it aint gunna happen in their lifetimes. Give it some time and many will do a Savinar. ...
Capitalists are not going to oblige by killing the goose thats laying the golden egg. Not until they have no choice and that will be determined in the malls and workplaces, not on doomer sites.

AD,

We could get collapse, tomorrow, or in 10 years or 30 years. Who knows? No one has a crystal ball and the world is not some wind up clock that is easily managed. The bankers and politicians are not really in control of things as well as they like to pretend. A sure fire indication of that is, after two bouts of money printing (QE's 1 and 2) the DOW (the virtual economy) is back to where it was before it all took place, but it seems that food and energy prices went on a tear as a result during that time, hurting the real economy. Yet, they, the bankers and politicians, intend to inject more money into a system which is clearly not responding to monetary stimulus. All this fruitless manipulation, as we have witnessed, has lead to huge instability around the world, with the system lurching from crisis to crisis. The end may not come all at once, as you predict, but in steeper and steeper gradients until, before we know it, we're eating cat-food outside the shipping container we now call home.

The worse doom comes steadily and silently.

[Outcast_Searcher]

I did notice what, to me, looked like a significant change during Wednesday's drop.

Monday, it really did look like "the machines" were indiscriminantly pressing down on just about EVERYTHING. If it was a stock, it was basically weak, and very much like the rest of the market.

Wednesday looked MUCH different. The high quality midstream energy MLP's, for example, rallied decently (after being beaten up like everything else). Since these (see AMZI index or AMLP ETF) will tend to have solid earnings, likely growing dividends, etc. even in BAD times (see Value line data for past few decades, and especially for 20008-2009 while everything else was badly deteriorating). PEOPLE were apparently making choices and voting for real QUALITY - for the long term. (And NO,I don't care if the tax break on MLP income goes away. That's just icing on the cake to me. Since I trade (mainly hold for growing dividends) AMLP (physical ETF), not much tax advantage there. Of course I avoid the 100% NON RECOURSE credit risk of AMJ (an ETN) if JP Morgan implodes, and I don't get the ETN tax break. Boo hoo. I'd rather keep my capital safe and not rely on idiots in Washington extending tax favors).

Another example. The MREIT industry (see NLY and REM) tried hard to rally (after being beaten up recently) until the meltdown the last couple hours, where they capitulated with the final market meltdown. Given the Fed's (idiot) promise of low rates for two years (or more) -- these looked pretty nice yielding double digit dividends on guaranteed (agency) paper. So, though far less safe and certain than AMLP components above, these seemed like a rational choice for PEOPLE to be allocating medium or possibly long term capital to.

One more example - IBM, a super-liquid tech. blue chip got creamed all day Wednesday. If European fears and a soft global economy were driving the market -- this was a logical pattern for PEOPLE to be shifting out of -- who were shifting into something they saw as safer/better, IMO.

I could be wrong here. Perhaps the programmers / Hedge Fund managers were just picking winners and losers for the machines to trade -- but this really felt markedly different to me yesterday.

Of course, I presume today is largely euphopria over Europe. What's a couple trillion Euros among "friends" anyway? (Total size of "rescue" fund likely needed, according to the "experts".) Of course, Germany won't like it and France can't afford it (despite being rated AAA by S&P), but the appearance of Northern European leaders gathering to "rescue" things sure seems nice -- for a day or a week, anyway.

Assuming the banks don't explode, IF people are actually trying to trade "rationally" via strategic planning/allocation, at least that would seem to avoid another 2008 scenario. (Volatility can be fun -- until it kills you).

Now -- I have NO clue how safe the banks are. I suspect almost no one, including the idiot bankers does either... Just one man's opinion.

[eXpat]

Traiding in the 10k range now -463 as i write this
U.S. stocks drop sharply on global worries

NEW YORK (MarketWatch) -- U.S. stocks plummeted Thursday, with the benchmark indexes down about 4% or more, on worries about Europe and the global economy.

“Market sentiment continues to deteriorate amid concerns about the euro-zone banking sector,” Marc Chandler, global head of currency strategy at Brown Brothers Harriman & Co., wrote in a note.
U.S. economic reports did not help in allaying concerns, as the number of Americans filing new claims for jobless benefits rose last week; consumer prices climbed 0.5% in July; and the Philadelphia Federal Reserve said factory activity in the region fell sharply in August.
Morgan Stanley reduced its forecast for global growth, calling Europe’s policy answer to its sovereign debt crisis insufficient; The Wall Street Journal cited people familiar with the matter in saying U.S. regulators had intensified scrutiny of the U.S. arms of European banks, and Sweden’s financial regulator said the nation’s lending institutions must take further steps to ready for Europe’s debt crisis to darken further.

http://www.marketwatch.com/story/us-stocks-drop-sharply-on-global-worries-2011-08-18

[TheAntiDoomer]

Been a while!!!