Posted by treid4dou on 4th of Sep 2008 at 04:59 pm
In reality....Gross wants Intervention by Paulson/Fed....to
solve the mess....He said today he would not buy any Bond Offering
from any Financial, referring specifically to
FNM,FRE,C,MER.......as long Paulson did not intervene....with
a Rescue package.....He did the same with the Housing issue
....time ago. Really....what he says is: Without a full Mkt.
Intervention....including flooding the mkt. with paper
money....we are heading directly to the worse depression in
History....thru Deflation....and Deleverage.....which is what is
happening....and will get even worse.....Today we saw ALL sectors
tanking together....not seen in a while.....I think his view is in
this direction.....IMO.....
Posted by pcampbell66 on 4th of Sep 2008 at 06:25 pm
the real issue is that Gross bought a ton of bonds expecting to
capitalize on the spreads given the implied guarantees from his
friends paulson and bernake...now he is siting on a time bomb and
the spreads have moved very far away from him and he is LOOSING a
lot of money. he wanted to play the inside track for easy returns
and the market proved that the treasury guarantee is not the main
issue there are other reasons that spreads will not improve and his
investments will be impaired and that has to do with the spreading
economic and liquidity issues from the rest of the
world undermining the impact of any fed or treasury
backed plan to maintain asset values...for obvious reasons...real
values are much lower...why should anyone be duped by the fed or
the government into thinking anything else...additionally why
should anyone seek to buy impaired or risk valued assets when cash
is tight? So guess what Bill Gross who attempted to capitalize on
getting huge returns guaranteed by the tax payer is now
sitting on HUGE losses - he won't admit it...but that's why he is
on TV complaining about in reality and that's why he is angry...the
free money he was expecting because of his insestuous relationship
with Bernake and Paulson let alone GS and JPM is gone kaput. They
are all a bunch of criminals and should be arrested for crimes
agains the american citizens that they work for.
Posted by treid4dou on 4th of Sep 2008 at 06:34 pm
fully agree......!!!! crooks!!!!....manipulators of main
street.....Why doesnt Bernanke give the $$$$ to each
household....instead than to his friends in Banks/Brokers....
Gross is spot on. This deleveraging and asset deflation
will be devastating. The free market will not solve this
problem - I don't like it but housing prices need to be supported
by the US gov't balance sheet. Otherwise we are in
depression.
Posted by treid4dou on 4th of Sep 2008 at 06:41 pm
Unfortunately..the only way to clean the house and the
mentality.....is to allow assets to deflate and the economy to
deleverage.....including some Banks go bankrupt.....if any
way.....they are giving the money to save them...and not to the US
citizen. They made the wrong rules...let them pay for
that....
This debt deflation will cascade into all asset classes, as it
already has, and then into the real economy, which it already is,
and then further into all asset classes, and so on and so
forth. We are talking systemic financial meltdown the likes
of which we have never seen before unless there is some support for
housing. This isn't fantasyland - this is real hard
economics. Moral hazard is real and true but we are past the
point of making moral hazard an issue. Housing and asset
inflation overshot on the upside and unlike extraordinary measures
are taken housing and all asset classes will overshoot on the
downside. The market along with the Fed have failed and we
cannot just wash our hands and think this is going to go away
without incredible long term effects on the real economy.
Booms and busts occur - but this is the greatest financial and
ECONOMIC crisis ever.
Posted by treid4dou on 4th of Sep 2008 at 09:31 pm
When these things happen...its a matter of who pays the bill.
Banks/Brokers should. Not the individual. Any hyperinflationary
measure will empoverish the individuals while saving the monies of
the crooks who engineered the huge leverage and derivatives. Let
them go bankrupt...and be liable for their responsibilities. Let
them return all the Bonuses they took home......let them have 20
years of earnings paid to their customers/depositors.....not the
shareholders...not the bondholders....those are big guys......let
the big guys learn their responsibilities. If not...they will
get away....once again. And they start all over again.
Come on......how come LEH be talking of a Bad Bank/Good Bank....to
lay off the toxic assets in the first one and keep quoting as if
nothing happened...!!!!!!!! .....in the other.... This is not
serious....Regulation regarding Level 3 accounting should
have been enforced a year ago.....thats what real....and the cro*ks
got away with a waiver......
I know this is a short-term trading blog for many people - and I
daytrade myself. But its also good to remember that the big
money is made by seeing a trend and committing to it. Selling
shorts yesterday afternoon or evening out of fear that the market
might gap up today is very short-term thinking -- good to
realize that. From an intermediate perspective it makes
little sense to sell when the market has just given such strong
confirmation of its downtrend.
I am a scaredy cat who has been burnt recently trading the gold
stocks, so preservation of capital is almost as important to me as
the profits.
You are very right and clearly more experienced - I am learning
and fortunately or unfortunately I sold out of SDS @ $69.00 after
having bought it @ $64.00 when S&P was at 1300.
One of the reasons I like this site is there are savvy guys here
who speak intelligently and calmly like yourself.
Please keep us relative newbies abreast of when you entry new
trades and what stops you use as this can be very helpful. I
am in the hole way too much from getting burnt on gold stocks so I
am really hoping to make a couple of good trades with shorts during
this next bear leg. I would like to get in again at some
point when the market rallies so I can participate and make some
money.
yankee -- one thing I would say, is you have to be clear when
you go in, what your time-frame is and what losses you can
tolerate. I started scaling into precious metals about three
weeks ago which was way too soon! and I'm way down. But I
made the decision to give these positions very wide stops because I
know that with sentiment toward gold so totally negative, the
sector can't just keep falling, there will be no one left to
sell. Yesterday my DGP position was down 20%. And its a
moderate-size position - 1500 shares. But I knew I simply was
not selling it. In fact I added to SLW yesterday and bought
GDX.
I've learned from my mistake and hopefully will not enter a new
position so early next time. But selling is not
necessarily the answer if you believe the trend is still up and do
not really need the capital for other trades. I am a lot in
cash, so I figure it can sit in that position until it comes back,
which it will.
Housing prices can not be artificially supported. I know I hear
this very day but they need free markets to work themselves out.
With Unemployment still rising, rates rising and credit tightening
how can people afford artificially supported prices. In my area
they built huge 750K/1M dollar homes where salaries can not support
them especially when you need 20% down compared to 5% 2 years
ago....
I don't see how this will help....only prolonging the
inevitable...
Do you believe we retest (Backtest) to 1260 on S&P or
not? I didn't want to go short until we back test to confirm
the move down. Is this the wrong approach and did I miss my
entry point?
The odds of it retesting that important of a support trendline
are 80%+ I hate to make that definitive of a statement, but
the market defies all odds. See right now everyone and their
brother sees a bad market so they have short orders and sell orders
going in for tomorrow. Once everyone knows something it
rarely follows through immediately. If that is the case we
should churn around for a day or two to let everyone get short, and
then bounce up to retest the trendline and even poking our head
through it a little bit to scare everyone out of their short
positions and possibly even turning people long. Then it will
be time to fall again. That has been how the market has
worked in the past, grinding away hurting the most amount of
people.
The other option could be this drop caught people off guard so
we could be entering a new phase now; where the blood doesnt stop
until everyone surrenders. Personally I entered short
positions when we broke through 1260, but I only had the nerve to
take on 35% because I had to give huge stop points.
Thankfully my 401Ks have been in 70% using leveraged funds.
If (fingers crossed) we get a retest of 1260-1265 I will move 100%
short. Otherwise my extra day of vacation cost me an
incredible amount of money.... :(
I heard that MER was going to come out with NO more write downs,
and I thought, this will be a shot in the financial arm,
therefore short the skf....luckily I sold as a hedge cc
strikes 110, 105, 95...so
QCOM....should be bought . Nokia used to buy chips
from Tex instruments....and wil soon anounce switching to QCOM...
check out ALL OF HP's new computers...all with GOBI, which is
QCOM's technology wireless everywhere. no more cords..not
selling a nickel of Q until 60's Qcom will get 50 bucks at least
from HP on every computer.
Wait till apple announces that they will second source their
chips from Qcom.
BTW...congrats on the short selling on apple and qcom...you did
good.
Posted by pcampbell66 on 4th of Sep 2008 at 06:33 pm
I have to say delane...i do not understand your argument or what
you must be thinking to want to short SKF...probabilities favor a
collapse of several large financial institutions is
forthcoming if not imminent - there will be lots more writedowns
and debt issuance - so this thing is probably going to take out the
highs...as i said yesterday, it was not a short. Today, its not
likely a short and i must warn you that its seems like you are
trading with your emotions and brain rather than discipline...I am
glad that you sold covered calls...but I can not see an indicator
that would like me short this thing...trust your indicators first
and then your thoughts and brain and don't get hurt...this is a
VERY dangerous market.
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Good thinking - heck he
Gross predicts Dow 5,000 September 6, 2002 (CNN/Money) The manager of ...
Posted by dodgerdog on 4th of Sep 2008 at 04:28 pm
Good thinking - heck he doesn't even trade equities. They need to rinse the pubilc to get long.
This market will most likely now trend lower into the fall so we'll stay defensive and short bounces.
They need to rinse the
Posted by dallahoo on 4th of Sep 2008 at 06:33 pm
They need to rinse the pubilc to get long
A transfer of wealth
In reality....Gross wants Intervention by
Posted by treid4dou on 4th of Sep 2008 at 04:59 pm
In reality....Gross wants Intervention by Paulson/Fed....to solve the mess....He said today he would not buy any Bond Offering from any Financial, referring specifically to FNM,FRE,C,MER.......as long Paulson did not intervene....with a Rescue package.....He did the same with the Housing issue ....time ago. Really....what he says is: Without a full Mkt. Intervention....including flooding the mkt. with paper money....we are heading directly to the worse depression in History....thru Deflation....and Deleverage.....which is what is happening....and will get even worse.....Today we saw ALL sectors tanking together....not seen in a while.....I think his view is in this direction.....IMO.....
the real issue is that
Posted by pcampbell66 on 4th of Sep 2008 at 06:25 pm
the real issue is that Gross bought a ton of bonds expecting to capitalize on the spreads given the implied guarantees from his friends paulson and bernake...now he is siting on a time bomb and the spreads have moved very far away from him and he is LOOSING a lot of money. he wanted to play the inside track for easy returns and the market proved that the treasury guarantee is not the main issue there are other reasons that spreads will not improve and his investments will be impaired and that has to do with the spreading economic and liquidity issues from the rest of the world undermining the impact of any fed or treasury backed plan to maintain asset values...for obvious reasons...real values are much lower...why should anyone be duped by the fed or the government into thinking anything else...additionally why should anyone seek to buy impaired or risk valued assets when cash is tight? So guess what Bill Gross who attempted to capitalize on getting huge returns guaranteed by the tax payer is now sitting on HUGE losses - he won't admit it...but that's why he is on TV complaining about in reality and that's why he is angry...the free money he was expecting because of his insestuous relationship with Bernake and Paulson let alone GS and JPM is gone kaput. They are all a bunch of criminals and should be arrested for crimes agains the american citizens that they work for.
fully agree......!!!! crooks!!!!....manipulators of main street.....Why
Posted by treid4dou on 4th of Sep 2008 at 06:34 pm
fully agree......!!!! crooks!!!!....manipulators of main street.....Why doesnt Bernanke give the $$$$ to each household....instead than to his friends in Banks/Brokers....
Yes, I know what Bill
Posted by dodgerdog on 4th of Sep 2008 at 05:09 pm
Yes, I know what Bill Gross wants and this makes a great deal of sense. Let's see how things play out.
Gross
Posted by yankee19 on 4th of Sep 2008 at 05:57 pm
Gross is spot on. This deleveraging and asset deflation will be devastating. The free market will not solve this problem - I don't like it but housing prices need to be supported by the US gov't balance sheet. Otherwise we are in depression.
Unfortunately..the only way to clean
Posted by treid4dou on 4th of Sep 2008 at 06:41 pm
Unfortunately..the only way to clean the house and the mentality.....is to allow assets to deflate and the economy to deleverage.....including some Banks go bankrupt.....if any way.....they are giving the money to save them...and not to the US citizen. They made the wrong rules...let them pay for that....
Ugh
Posted by yankee19 on 4th of Sep 2008 at 09:11 pm
This debt deflation will cascade into all asset classes, as it already has, and then into the real economy, which it already is, and then further into all asset classes, and so on and so forth. We are talking systemic financial meltdown the likes of which we have never seen before unless there is some support for housing. This isn't fantasyland - this is real hard economics. Moral hazard is real and true but we are past the point of making moral hazard an issue. Housing and asset inflation overshot on the upside and unlike extraordinary measures are taken housing and all asset classes will overshoot on the downside. The market along with the Fed have failed and we cannot just wash our hands and think this is going to go away without incredible long term effects on the real economy. Booms and busts occur - but this is the greatest financial and ECONOMIC crisis ever.
When these things happen...its a
Posted by treid4dou on 4th of Sep 2008 at 09:31 pm
When these things happen...its a matter of who pays the bill. Banks/Brokers should. Not the individual. Any hyperinflationary measure will empoverish the individuals while saving the monies of the crooks who engineered the huge leverage and derivatives. Let them go bankrupt...and be liable for their responsibilities. Let them return all the Bonuses they took home......let them have 20 years of earnings paid to their customers/depositors.....not the shareholders...not the bondholders....those are big guys......let the big guys learn their responsibilities. If not...they will get away....once again. And they start all over again. Come on......how come LEH be talking of a Bad Bank/Good Bank....to lay off the toxic assets in the first one and keep quoting as if nothing happened...!!!!!!!! .....in the other.... This is not serious....Regulation regarding Level 3 accounting should have been enforced a year ago.....thats what real....and the cro*ks got away with a waiver......
Gross
Posted by yankee19 on 5th of Sep 2008 at 05:24 am
This has only begun. The real economic impact hasn't hit the masses - yet.
I hate to be a doomsdayer - this whole thing sucks. And you certainly need to be careful with sohrts here - tight stops rule the day.
This deleveraging and forced sell in all risk asset classes is and will be devastating.
I know this is a
Posted by Michael on 5th of Sep 2008 at 08:37 am
I know this is a short-term trading blog for many people - and I daytrade myself. But its also good to remember that the big money is made by seeing a trend and committing to it. Selling shorts yesterday afternoon or evening out of fear that the market might gap up today is very short-term thinking -- good to realize that. From an intermediate perspective it makes little sense to sell when the market has just given such strong confirmation of its downtrend.
Michael
Posted by yankee19 on 5th of Sep 2008 at 09:09 am
I am a scaredy cat who has been burnt recently trading the gold stocks, so preservation of capital is almost as important to me as the profits.
You are very right and clearly more experienced - I am learning and fortunately or unfortunately I sold out of SDS @ $69.00 after having bought it @ $64.00 when S&P was at 1300.
One of the reasons I like this site is there are savvy guys here who speak intelligently and calmly like yourself.
Please keep us relative newbies abreast of when you entry new trades and what stops you use as this can be very helpful. I am in the hole way too much from getting burnt on gold stocks so I am really hoping to make a couple of good trades with shorts during this next bear leg. I would like to get in again at some point when the market rallies so I can participate and make some money.
yankee -- one thing I
Posted by Michael on 5th of Sep 2008 at 09:52 am
yankee -- one thing I would say, is you have to be clear when you go in, what your time-frame is and what losses you can tolerate. I started scaling into precious metals about three weeks ago which was way too soon! and I'm way down. But I made the decision to give these positions very wide stops because I know that with sentiment toward gold so totally negative, the sector can't just keep falling, there will be no one left to sell. Yesterday my DGP position was down 20%. And its a moderate-size position - 1500 shares. But I knew I simply was not selling it. In fact I added to SLW yesterday and bought GDX.
I've learned from my mistake and hopefully will not enter a new position so early next time. But selling is not necessarily the answer if you believe the trend is still up and do not really need the capital for other trades. I am a lot in cash, so I figure it can sit in that position until it comes back, which it will.
Well said Michael
Posted by jcomptonod on 5th of Sep 2008 at 09:07 am
I'll bet most of us have been guilty of that, including myself.
so gross, what a befitting
Posted by dallahoo on 4th of Sep 2008 at 06:40 pm
so gross, what a befitting name, is out asking for things to be done so that the average person is shielded from a depression? what a nice guy he is!
Papa Theresa maybe
Housing prices can not be
Posted by dylan398 on 4th of Sep 2008 at 06:13 pm
Housing prices can not be artificially supported. I know I hear this very day but they need free markets to work themselves out. With Unemployment still rising, rates rising and credit tightening how can people afford artificially supported prices. In my area they built huge 750K/1M dollar homes where salaries can not support them especially when you need 20% down compared to 5% 2 years ago....
I don't see how this will help....only prolonging the inevitable...
Steve, Do you believe we retest
Posted by cspirit on 4th of Sep 2008 at 04:37 pm
Steve,
Do you believe we retest (Backtest) to 1260 on S&P or not? I didn't want to go short until we back test to confirm the move down. Is this the wrong approach and did I miss my entry point?
Thoughts?
Title: imho The odds of it
Posted by cwa82675 on 4th of Sep 2008 at 09:49 pm
The odds of it retesting that important of a support trendline are 80%+ I hate to make that definitive of a statement, but the market defies all odds. See right now everyone and their brother sees a bad market so they have short orders and sell orders going in for tomorrow. Once everyone knows something it rarely follows through immediately. If that is the case we should churn around for a day or two to let everyone get short, and then bounce up to retest the trendline and even poking our head through it a little bit to scare everyone out of their short positions and possibly even turning people long. Then it will be time to fall again. That has been how the market has worked in the past, grinding away hurting the most amount of people.
The other option could be this drop caught people off guard so we could be entering a new phase now; where the blood doesnt stop until everyone surrenders. Personally I entered short positions when we broke through 1260, but I only had the nerve to take on 35% because I had to give huge stop points. Thankfully my 401Ks have been in 70% using leveraged funds. If (fingers crossed) we get a retest of 1260-1265 I will move 100% short. Otherwise my extra day of vacation cost me an incredible amount of money.... :(
yeah, Im with you
Posted by delane on 4th of Sep 2008 at 04:50 pm
I heard that MER was going to come out with NO more write downs, and I thought, this will be a shot in the financial arm, therefore short the skf....luckily I sold as a hedge cc strikes 110, 105, 95...so
QCOM....should be bought . Nokia used to buy chips from Tex instruments....and wil soon anounce switching to QCOM... check out ALL OF HP's new computers...all with GOBI, which is QCOM's technology wireless everywhere. no more cords..not selling a nickel of Q until 60's Qcom will get 50 bucks at least from HP on every computer.
Wait till apple announces that they will second source their chips from Qcom.
BTW...congrats on the short selling on apple and qcom...you did good.
I have to say delane...i
Posted by pcampbell66 on 4th of Sep 2008 at 06:33 pm
I have to say delane...i do not understand your argument or what you must be thinking to want to short SKF...probabilities favor a collapse of several large financial institutions is forthcoming if not imminent - there will be lots more writedowns and debt issuance - so this thing is probably going to take out the highs...as i said yesterday, it was not a short. Today, its not likely a short and i must warn you that its seems like you are trading with your emotions and brain rather than discipline...I am glad that you sold covered calls...but I can not see an indicator that would like me short this thing...trust your indicators first and then your thoughts and brain and don't get hurt...this is a VERY dangerous market.