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Old 12-30-2008, 07:18 PM
Location: Los Angeles, Ca
2,884 posts, read 5,296,240 times
Reputation: 2737


I'm not a pure technician or chartist, but the long term chart of the S&P is so ominous and disturbing.

The credit bubbles show up better than on a Dow or Nasdaq chart. It looks a little bit more pure.

Look at like a 30 year weekly chart. Two gigantic bubbles that went off the page. Accelerating in 95/96, Greenspans exuberance. A gigantic top in 99/00. And a gigantic top in 07.

We've had a marginal bounce off the lows so far.

I dont think the market has discounted all the bad news about the economy. Hard for me to believe that (it's discounted everything on banks balance sheets, it's discounted higher unemployment, discounted long bonds ultimately going higher).

How do stocks go higher if bonds decline, and yields go up? I think we get a second leg down in 2-3 years when the economic revival doesn't happen. We have to test the 1995/96 levels, thats when this bubble started accelerating.

In reference to Japan, people thought it was overvalued at 18-20,000. Then it went to 40. Then it bounced around for awhile, but ultimately broke 18-20. The long term bears/pessimists get vindicated (but it takes awhile).
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Old 12-31-2008, 08:31 AM
458 posts, read 701,084 times
Reputation: 156
Originally Posted by CouponJack View Post
My point was the analysts at that bank you posted are no better at making predictions than a bunch of monkeys throwing darts at a dartboard...

So you believe we still have another 45% to drop yet (on top of a 40% drop)? I'm not so sure about that......we'll see.
I am saying it could, not that it will. Historically, like in Japan in the 1990's and in our country in the 1930's it has happened.
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