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I didn't say that ... but the big market drop on Monday with the "official" recession news also stated there actually hasn't been two negative quarters of GDP growth ...
Only one quarter so ... 10 percent negative GDP seems really out there at this point.
Look: I don't really care where the short term dips and fluctuations are because I can't predict those ... I'm looking at where this market will be six months from now and I'm convinced it's going to be up.
"We need a nice huge sell off so the market can begin to bottom out and recover. With any luck, October will be the month ... which, if history is an indication ... usually is the time for the big one."
Oh, Sheri, I hope you're right, but why would you gamble with borrowed money? You know how many of these toxic loans are out there, what a drain that will be on the economy.
I have friends who work on Wall Street and they say the public has no idea how bad it is, how much has been kept from us, how much deleveraging is yet to come, how much pink slipping is right around the corner. Some major retail chains will go under after a bad holiday season, unemployment will soar into the double digits (and is probably already there now, if you look at the real numbers, not the shadow ones) and consumers will barely be able to pay their heating bills for what is already an early, cold winter in the Eastern states, much less spend to get the economy going. CEO's, notoriously unreliable, always paint a rosier picture than is realistic, so if they say six months, you can bet it will be at least double or triple that.
All of us (well, most of us) would love for the economy to recover by mid-2009, but wishing won't make it so. Best case scenario, if that does happen, you have a lot of carnage between now and then, so why buy now? Why reach for the falling knife and get all bloody? But, then, maybe you're buying bear market funds or trading story stocks. I've been doing that, and I'm making some money. So, hopefully, you are, too.
I have friends who work on Wall Street and they say the public has no idea how bad it is, how much has been kept from us, how much deleveraging is yet to come, how much pink slipping is right around the corner.
These were the same guys who were telling everybody to "stay the course" a year ago. If they were still optimistic ... I'd actually be a hellava lot more worried about buying now. This is the buy signal I've been waiting for ... mass pessimism even from the so-called experts.
The unemployment stats totally sucked at the beginning of the early '90s bull market and continued for a couple of years. There were tons of bad headlines about the "jobless recovery" so ... if it happens again this time ... that doesn't mean the market is going to tank.
But, like I said, if you guys were actually agreeing with me then ... I wouldn't be buying stocks right now. The time to buy is when everybody thinks the sky is falling.
Oh, Sheri, I hope you're right, but why would you gamble with borrowed money?
Because the borrowing costs are dirt cheap right now and the potential rate of return is very high. The market is already 40-45 percent down so ... the downside risk at this point is very low. The potential upside, however, is huge so .... it's worth the gamble.
"I think the market is going to crash burn through October then, start to bottom out."
This was wrong. The market continued to crash in November.
And making the prediction that October is going to decline when the market is already declining isn't exactly interesting.
Regardless, you are betting all your money and even money you don't have on some vague similarities while completely ignoring the fundamental issues in the economy today. One really has to think why stocks increased so much from the mid 80's to now. It wasn't because earnings were growing....so I wonder what it was....gee.....can someone say Ponzi Scheme....
Quote:
Originally Posted by sheri257
Because the borrowing costs are dirt cheap right now and the potential rate of return is very high. The market is already 40-45 percent so ... the downside risk at this point is very low. The potential upside, however, is huge so it's worth the gamble.
The downside risks aren't very low and the upside potential is rather low. There isn't just two options, the market can stagnant for many years.
And really, this is just a noobish way to gamble on the direction of the equity markets. Why buy stocks if you think you are so right? You can make much more money if you are correct in options etc. Most likely because you have no idea how these things work, which is just to say you just bet all your money (and money you don't have) on a market you really don't understand.
Because the borrowing costs are dirt cheap right now and the potential rate of return is very high. The market is already 40-45 percent down so ... the downside risk at this point is very low. The potential upside, however, is huge so .... it's worth the gamble.
The downside risk is low while the upside potential is huge ? Was that a typo on your part ? This is a bear market you know..shorting would make you more money than going long.
This was wrong. The market continued to crash in November.
And making the prediction that October is going to decline when the market is already declining isn't exactly interesting.
Again, if you're so bored I'm not sure why you even bother to comment at all ...
However, the market crashed 25 percent in October so ... with nearly HALF of the past year's correction happening in that one month, which is what I predicted.
The market dropped another 8 percent from the October lows during one week in November and then it bumped up again to the current levels so ... I wouldn't exactly call that a crash.
But then you're going to nitpick everything I say anyway so ... we'll see who turns out to be right come spring.
But, like I said, if you guys were actually agreeing with me then ... I wouldn't be buying stocks right now. The time to buy is when everybody thinks the sky is falling.
You keep saying this, yet the fact is most people don't think the sky is falling. Most people are still contributing to their 401(k), because they are "in it for the long haul". I have heard countless times from people how they aren't worried about their loses because "they're not retiring yet". Straight from the feed from the media. Keep enough suckers buying and not selling while the smart money exits the market.
You think its a buy signal because people are getting more negative. But bottoms in markets correlate with a bottom in negativity. How do you know there has been such a bottom? You have no idea.... In fact there is no indication that this is occurring. This correlation is completely useless as predicting where market sentiment is going is just as hard as predicting where the market itself will go. But, I know they don't teach that in the Warren Buffet wannabe handbook...
This is a bear market you know..shorting would make you more money than going long.
Just who on Wall Street are you following ?
Nobody. What's the point of following Wall Street? That's the real disaster ... they told everybody to hold on last year and look at where it got them.
The time to short was last year ... not now. Sure ... there's some short term bets to be made with the daily dips but ... other than that ... the bear market is essentially over.
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