Posted by pcampbell66 on 13th of Sep 2008 at 09:37 am
I suggest an examination of the FED - the effects of it and its
eroding credibility in and on bear markets. The decline of the
fed's credibility and capabilities eventually causes a Fed meeting
and/or a rate cut to be seen as negative events...and rather than
getting short covering or a rally before a meeting or a cut - you
get selling. rather than getting a rally on a cut - you get
selling.
The fed is panicing not to mention hapless...henry paulson
is trumped and clueless as to what to do (not to mention doing
the worst job of anyone in his position i can remember)...should he
backstop or should he send a mixed message and not backstop and be
concerned about the moral hazard? In any case he is behaving
erratically...
erraticism is not positive reinforcement for
market participants.
So, we are finally at the stage where a fed meeting is likely a
reason to assume that more bad decisions will be made...more
negatives will be created and more foxes are guarding the hen
house. Watch for VERY heavy selling next week...the bounce is
likely finished as of friday save for a small bout of short
covering on monday AM (or possibly early in the week - unlikely) by
weak hands... the fed meeting and rate cut (if it happens) will
most likely be a selling event.
As a someone I know recently said...difficult times
p.s. calls in WM are a BAD investment as are calls in LEH and
AIG or GE or the market for that matter...GE share prices will
likely collapse next week sending a shudder through the market.
nearly 200 million shares traded on Friday - down big...largest
size of trade (save April this year) in GE's history! Why was that
not on the tube? makes you wonder...ehh?
Posted by dallahoo on 14th of Sep 2008 at 12:18 pm
Interesting view, thanks for sharing,
Given what the Ben-Hankee team had to deal with, wouldn't you
agree they have done a heck of a job. They have wounded the
commodity bull, managed to slow the financial free fall,
sprayed many gold bugs into early exinxtion, have caused short
covering rallies in housing and retail -- they have bought a lot of
time.
I think they have proved themselves better connected and more
imaginitive than many other players in the market. They realized
the fault line of hedgies: leverage, and inadequate risk
management, and pushed them over, and with that went commodities,
and most important of all, future inflation
expectations. what took inflation pundits years to build (it's
all about perception, after all) evaporated in a few weeks.
So far, IMHO, they have been brilliant, like a poker player who
stays in the game on a constant stream of extremely bad hands.
End result may still be the dire conclusion of a bear market,
but they are very clever players.
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I suggest an examination of
Posted by pcampbell66 on 13th of Sep 2008 at 09:37 am
I suggest an examination of the FED - the effects of it and its eroding credibility in and on bear markets. The decline of the fed's credibility and capabilities eventually causes a Fed meeting and/or a rate cut to be seen as negative events...and rather than getting short covering or a rally before a meeting or a cut - you get selling. rather than getting a rally on a cut - you get selling.
The fed is panicing not to mention hapless...henry paulson is trumped and clueless as to what to do (not to mention doing the worst job of anyone in his position i can remember)...should he backstop or should he send a mixed message and not backstop and be concerned about the moral hazard? In any case he is behaving erratically... erraticism is not positive reinforcement for market participants.
So, we are finally at the stage where a fed meeting is likely a reason to assume that more bad decisions will be made...more negatives will be created and more foxes are guarding the hen house. Watch for VERY heavy selling next week...the bounce is likely finished as of friday save for a small bout of short covering on monday AM (or possibly early in the week - unlikely) by weak hands... the fed meeting and rate cut (if it happens) will most likely be a selling event.
As a someone I know recently said...difficult times
p.s. calls in WM are a BAD investment as are calls in LEH and AIG or GE or the market for that matter...GE share prices will likely collapse next week sending a shudder through the market. nearly 200 million shares traded on Friday - down big...largest size of trade (save April this year) in GE's history! Why was that not on the tube? makes you wonder...ehh?
The Fed
Posted by dallahoo on 14th of Sep 2008 at 12:18 pm
Interesting view, thanks for sharing,
Given what the Ben-Hankee team had to deal with, wouldn't you agree they have done a heck of a job. They have wounded the commodity bull, managed to slow the financial free fall, sprayed many gold bugs into early exinxtion, have caused short covering rallies in housing and retail -- they have bought a lot of time.
I think they have proved themselves better connected and more imaginitive than many other players in the market. They realized the fault line of hedgies: leverage, and inadequate risk management, and pushed them over, and with that went commodities, and most important of all, future inflation expectations. what took inflation pundits years to build (it's all about perception, after all) evaporated in a few weeks.
So far, IMHO, they have been brilliant, like a poker player who stays in the game on a constant stream of extremely bad hands.
End result may still be the dire conclusion of a bear market, but they are very clever players.