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Yeah. Stocks are always cheap before bankruptcy. Watch what happens to the shale oil companies and the hundreds of billions of dollars in junk bonds that they owe "investors".
The problem is that distorted capital investments are now worldwide. They are everywhere thanks to the free money from the Central Banks. The housing Bubble was limited compared to the insanity of the last 7 years. Who knows where all of this will end up but it's going to be ugly.
I'm noticing a lot of chatter about the coming recession. Or whether we are actually currently in it.
I was too young to really experience the start of the last recession with respect to what was happening in the business world. Are there similar scenarios happening today as back then. What are experienced business-peoples thoughts?
Btw, this is not to be a doom and gloom post. Just looking for opinions.
What is coming is huge, great depression huge, not a recession. To answer your question, no, we have not started it. A lot of people were calling for it back in August, and they are calling for it again with recent market volatility. Since August, they pumped the market right back up, and they can do it again this time too. The reason is nothing has "broke." Something needs to break as in a large bank going down, and then you need 2 negative quarters of gdp before the next "recession" can officially be called.
Quote:
Originally Posted by richrf
Look at the commodity chart. It has totally collapsed. It is causing massive destruction and upheavals everywhere in the world. It is the reason the Fed has to start raising rates and why Abe and Draghi can't print any more money for their stock market levitation tricks. It is a catastrophe of incredible proportions. It will be hitting out economy and bond markets very soon. Of course Alcoa's numbers are just the beginning. All a result of the Fed free money policy which totally distorted allocation of capital.
I put my post above yours so I can now explain since it has been a couple days since I posted it. Dow futures are up 159 as I speak. If they hold, this will be the 3rd up day in a row. All the losses from the first of the year can easily be made right back up because nothing has broken. I am not saying that is definitely going to happen, but it is easily possible. The drop this year is most likely another false alarm like August.
All the losses from the first of the year can easily be made right back up because nothing has broken. I am not saying that is definitely going to happen, but it is easily possible. The drop this year is most likely another false alarm like August.
This drop is real and it's well organized, no panic selling, which means it's done by large institutions. So far this is merely a market correcting as reality sets in that the economy isn't as rosy as they think and corporate profitability growth is dropping not rising. This has further to run and may not come back.
I'm sure the institutions hope that individuals buy their way out of their mess, however, after scaring off their prey with all sorts of deviant practices like trading faster than you can type, placing tons of false orders, trading back and forth with each other, and artificially pricing IPOs it will be a tough road to get them to come back in mass.
Enron did not have a product.
They simply brokered energy on the open market.
Remember WorldCom?
You guys are way out of sync with the real business world.
The CEOs borrow billions. Stuff it in their pockets. And let the company go bust. All nice and legal and courtesy of Fed Free Money for the Billionaires policy.
Now, this has only happened twice before in the last two decades so might I ask .... When do you figure you'll wake up and stop being so naive?
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