Is the stock market going to tank?

[Brock Landers]

I meant aside from indirectly (rates/FOMC)...is the government buying stocks of companies not names AIG or C

the whole 'indirectly' thing is exactly what the govt is there for, as far as the Fed. Youd be foolish to not expect the governemtn to intervene in those situations where it has to. And if you dont agree with what the government does...theyre doing it anyway so deal with it (invest appropriately)

[Benny Profane]

It never fucking fails. Ask a simple question, like, who the fuck is buying stocks these days, and you get slapped with acronyms and tech talk about futures and contracts. You guys really don't know, do you?

BTW, Kudlow just told me today's dip is Obama's fault. My palm has hit my forehead.

[4matic]

It never fucking fails. Ask a simple question, like, who the fuck is buying stocks these days, and you get slapped with acronyms and tech talk about futures and contracts. You guys really don't know, do you?

BTW, Kudlow just told me today's dip is Obama's fault. My palm has hit my forehead.

Buying index contracts is an easier and more discreet way to buy stocks and it amounts to the same thing.

[Brock Landers]

Wasnt really technical

Who is buying stocks: investment managers are buying stocks. Over the 2nd, 3rd, and somewhat the 4th quarter low quality stocks- those which got hammered the most in 2008- came back. People were buying risk. Emerging Markets. Growth stocks. Cyclical stocks, to a degree. EAFE...sorry...Europe Australasia Far East.

People saw that companies which were still in business at that point may be priced at such valuations that it was a good investment. Sure, the sky could fall, but you wouldnt be paying very much, and theres tremendous upside. Now value stocks- those stable companies with relatively level cash flows- are probably going to surge a bit more, especially in a tough economy.

Even the S&P was up 6% in 4Q. It seemed like it didnt do much, but 6% is a mediocre year nevermind quarter. There are still bargains out there- not like in March or May but if you can find a company with good, solid management that can adapt to the changing and tough economy, you can have it at a good price. And the people finding these companies are buying stocks.

Heard an interesting thought today from a management team- the concept of a bubble in the bond market.

[retirwntm]

It never fucking fails. Ask a simple question, like, who the fuck is buying stocks these days, and you get slapped with acronyms and tech talk about futures and contracts. You guys really don't know, do you?

benny,

i seriously have to question whether you read...even the things you yourself copy and paste. i'm going to re-quote what i responded and explain:

"The idea that this is magic is nonsense," said Barry Ritholtz, market strategist at Fusion IQ and a market veteran. "This was a normal behavior in a recessionary bear market. We saw the Dow plunge 5,000 points in 6 months, which had never happened before and created a dramatically oversold market."
--------------------
translation: ritholtz views the buying as a once in a generation opportunity. sellers oversold when it appeared the world was coming to an end. when the world did not end, buyers rushed in for value across many asset classes. this happened in stocks, high yield bonds, CDS, etc., etc. that got pounded in the liquidation.
--------------------

But "you can't short stocks when the Fed is at zero," Ritholtz said. "Our own institutional clients came on board" as did other big institutional investors, he said.
--------------------
ritholtz is clearly saying institutional clients and big institutional investors came in to buy the equity markets. i will add, it was done in stages as the TARP was enacted, banks were reliquified, mark-to-market rules were relaxed, etc.
--------------------

one note of caution, perhaps this is at the heart of your question: the markets are being traded by a far greater number of participants than they are being invested. there are very few long term investors. institutions and traders will move markets however policies and prevailing business climates seem at any moment in time, and it will change faster than people change their status on facebook.

as far as acronyms & tech talk, here are some definitions if i missed the mark on round one:

VIX = volatility index (contract) wiki it
GS = Goldman Sachs (thought you knew that one)
ZIRP = Zero Interest Rate Policy

larry kudlow is a dyed in the wool reagan republican, he worked as an economist for his admin. of course he will tell you and anyone who listens conservative policies are the only ones that can save the US. what he won't admit to is that several same policies nearly blew it up. the guy is a muppet.

[Benny Profane]

So, you guys confirm my suspicions that it's a casino. Blankfein didn't make 100 mil by folding his cards and passing. And, well, it helped that his dudes were the dealers.

Bonds aren't bubbled, but bond funds are.

[Benny Profane]

benny,

i seriously have to question whether you read...even the things you yourself copy and paste. i'm going to re-quote what i responded and explain:

"The idea that this is magic is nonsense," said Barry Ritholtz, market strategist at Fusion IQ and a market veteran. "This was a normal behavior in a recessionary bear market. We saw the Dow plunge 5,000 points in 6 months, which had never happened before and created a dramatically oversold market."
--------------------
translation: ritholtz views the buying as a once in a generation opportunity. sellers oversold when it appeared the world was coming to an end. when the world did not end, buyers rushed in for value across many asset classes. this happened in stocks, high yield bonds, CDS, etc., etc. that got pounded in the liquidation.
--------------------

I read a lot, amigo. And that is such a tired and silly reaction to what is one of the greatest credit crashes in history. I find it horribly parochial. As though what just happened is a normal cyclical downturn, and all one had to do is rush in and scoop up the bargains. I hear it a lot on CNBC from the salesman on both sides of the mike, you know, the reason we aren't seeing the other side of the V is because the socialists are fucking things up. Just eliminate all taxes and regulation, let everyone crawl to a hospital and kick them in the face if they don't have money, and we'll all be living the good life soon. Markets are without sin. Well, lets just see what happens in '10 when the Fed stops supporting the housing market and they let that be a real market and Greece goes belly up with Spain right behind and the Euros let them be a real market, and the charade of mark to fantasy market comes home to roost. It ain't over until it's over, and this one has a long way to go.

[retirwntm]

i would liken it to a casino in that the odds are against anyone that walks in ignoring the numbers & thinks they can drop down $100 and leave as a baller. the equity markets should be an absolutely do your homework long term value, pick your stocks oriented approach. if you can't or won't do that, then put your money with a good management team that's proven they can. bill gross on the bond side, bill miller on the equity side for mere mortals. if you had multi millions, hedge funds would be approaching you...daily.

[retirwntm]

benny, there are some serious gun slingers out there that were willing to bet their money, careers, mistresses, hamptons houses, everything on the deals that were to be had at the beginning of 2009. there are some people who will double, triple or go in 30x leverage and bet right. when valuations became so oversold, at some point, they were headed to zero or up.

i am not placing moral judgment on it either way. i am just noting that it happened and happens.

[retirwntm]

p.s. you would be better off shorting the markets if you truly have all this angst & worldview. at least you will be directionally right & early some of the time. you would have killed it in 2008.

[Benny Profane]

benny, there are some serious gun slingers out there that were willing to bet their money, careers, mistresses, hamptons houses, everything on the deals that were to be had at the beginning of 2009. there are some people who will double, triple or go in 30x leverage and bet right. when valuations became so oversold, at some point, they were headed to zero or up.

i am not placing moral judgment on it either way. i am just noting that it happened and happens.

Hey, whatever, but DON'T COME FUCKING WHINING TO ME WHEN YOU ROLL THE DICE LIKE THAT AND FAIL and take my fucking tax money to pay your skanky mistress afterwards. We let these MFs play with leverage like that over the last decade, and the only guys who failed were Lehman and Bear, but hey, even they didn't fail, because all the top dudes, if they were smart and didn't spend all their cash, are sitting in a hot tub right now attached to a noice fuck pit on the side of some western ski mountain getting a blow job from said mistress. Do you really think Fuld is hurting these days? Sure, he had to sell the fifth and sixth home and maybe ten Warhols, but, trust me, he's fine. And, here we are, cleaning up his mess, and NOTHING HAS CHANGED! Really, all of that could happen tomorrow. Any new rules? No. Any new regs? No. ANYBODY IN JAIL? Fuck no.
They all say that if we put up walls again and regulate, then all the biz will go to Europe or wherever. Fucking blackmail. I say, fine, let that corrupt, immoral behavior take England or Hong Kong down in five or ten years. We've seen what it can do here, so why not deport it?

[retirwntm]

well, that doesn't stop with the banks. laws don't get passed for the "greater good" because washington is run by lobbyists and revolving door politician / lobbyists.

[ICEHOCEY77]

I think the perma bear has re-awoken from his cave. Three weeks and six hundred points on the dow later. You cash out that index fund yet?

[Spats]

Oh, by the way, we forgot to tell you that the entire year's employment numbers were a complete lie.

http://www.hussmanfunds.com/wmc/wmc100208.htm

"The January employment report Friday was interesting. A month ago, the December employment report indicated total non-farm employment of 130,910,000 jobs. Following revisions, the January employment report indicated total non-farm employment of 129,527,000 jobs, a net loss of nearly 1.4 million jobs - over and above what had previously been reported. Essentially, job creation was vastly overestimated during 2009. While these revisions were spread over the year, particularly March, the extent of the previous overestimation is notable given the large conclusions that market participants lend to monthly "surprises" of even 10,000-20,000 jobs."

[schwerty]

Ahh...someone else that reads Hussman's doom and gloom. Thought I was a lone soul.

[4matic]

Ten percent correction in an uptrend. HEAVY volume this morning on the buy side. A move to 1100 on SP can be shorted with tight stops. Correction came at the right time seasonally so I remain positve that the market should be sideways at worst this year. No gloom and doom. Corporate earnings are pretty good.

[liv2ski]

Ten percent correction in an uptrend. HEAVY volume this morning on the buy side. A move to 1100 on SP can be shorted with tight stops. Correction came at the right time seasonally so I remain positve that the market should be sideways at worst this year. No gloom and doom. Corporate earnings are pretty good.

Side ways can be a profitable market condition for people that do their research. I was a buyer this morning so watch out, the sky will be falling.

[ICEHOCEY77]

HEAVY volume this morning on the buy side.

it was the bullshit news that the EU was going to back Greece's debt, followed almost an hour later by the german finance minister refuting the story. Eur/usd had a 150 pip swing in that time frame. Someone cleaned up.

[Fenrisulfr]

Stocks are not accurately reflecting economic fundamentals. If one wishes to play the market, go short.

[ass-to-mouth]

Matt Taibbi has another brillant article in Rolling Stone - "Wall Street's Bailout Hustle"

http://www.rollingstone.com/politics...t_hustle/print

[grapedrink]

Matt Taibbi has another brillant article in Rolling Stone - "Wall Street's Bailout Hustle"

http://www.rollingstone.com/politics...t_hustle/print

the drug analogies are a bit much but everyone should seriously read that article, start to finish.

[Benny Profane]

Matt Taibbi has another brillant article in Rolling Stone - "Wall Street's Bailout Hustle"

http://www.rollingstone.com/politics...t_hustle/print

Ha. I was thinking about his first article the past few days when Goldman got connected to Greece. Vampire squid, indeed.

[Spats]

the drug analogies are a bit much but everyone should seriously read that article, start to finish.

+1000

......

[liv2ski]

Wow, that Rolling Stone article blew my mind. Once again I am just knocked out by the fact of how bad the US Tax Payer has been/will be fucked to prop up a few companies.
I love how in the 1980's during the S&L crisis, thousands of banks were allowed to fail and the fuckers running them often were convicted of fraud and sent to jail. Not this time though, as the crooks are now running the government too.

[Spats]

Here's a great article about the "sea of debt" we're in, how we got there, and how we might get out:
http://www.telegraph.co.uk/comment/p...a-of-debt.html

"...What is needed is a root and branch re-evaluation of that most curious of cultural inventions – money – how it is created, how it circulates within an economy and how it can best be used to serve the interests of the community itself.

To begin then, the experts owe it to the people to explain to them in the simplest terms how it is that money actually works."