Very insightful and true in many senses. Although imho,
the masses have been allowed to have some sense of security to
avoid another episode like Nov. '08 to occur. This has been a
false sense though. Imagine the worse credit crisis EVER and
we are still not out of it. Eventhough house sales have
stabalized, prices continue to drop due to short sales and
foreclosures, which will continue to rise as unemployment
rises.
Housing stabalizing has been a farce. Fannie Mae,
Homecomings, GMAC, and many other banks had a moratorium on
foreclosures through April into May. Individuals and families
were allowed to stay in the homes they could not pay for because
these banks did not want vacant homes (no one around allowed for
theft) and assets they would be required to carry in their books
and would not be able to sell. These banks have told realtors
that what is coming in the quantity of foreclosures will amaze them
(14,000 to one realtor alone).
It does not need to be any major event but the idea that things
are truly not getting better and actually getting worse will most
likely be the catalyst. If there is any. The good thing as always
is that we are not required to foreshadow the market...just trade
what is given to us everyday and change with it if it changes.
Posted by junkmaylbox on 8th of Jun 2009 at 11:39 pm
I concur. Even though stocks are said to be driven by earnings
-- which are reported as 1/4 of what they were last year --
it is the masses that bring their money in. When folks need money
-- and they will need it to survive -- they will liquidate their
assets. Foreclosures, job losses, the drop of standard of living
will take their toll. those are involuntary actions, and they will
be taken despite the best assurences to the contrary. We haven't
seen forced bankruptcies yet, which happened in 1930s; extreme risk
aversion for investing, which normal mark market bottoms.
In short, I would ignore what Americans say and will see what
they are up to in the not so distant future. And don't forget that
foreigners who hold US dollars, don't keep them in the banks. When
they decide to call it quits -- and they will after $US drops
enough -- there will be nothing to prop up stock prices.
During the 1930s the only category of stocks that went up were
mining stocks
They went up 4 or 5 times from their 1930 prices. If you
understand everything about how depressions work, you should be
able to explain how on earth that could have happened.
Chris Laird once said that one could buy a house for 10 ounces
of gold then. I am waiting to see this happen again.
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Very insightful and true in
the Wave count
Posted by asantana on 8th of Jun 2009 at 11:05 pm
Very insightful and true in many senses. Although imho, the masses have been allowed to have some sense of security to avoid another episode like Nov. '08 to occur. This has been a false sense though. Imagine the worse credit crisis EVER and we are still not out of it. Eventhough house sales have stabalized, prices continue to drop due to short sales and foreclosures, which will continue to rise as unemployment rises.
Housing stabalizing has been a farce. Fannie Mae, Homecomings, GMAC, and many other banks had a moratorium on foreclosures through April into May. Individuals and families were allowed to stay in the homes they could not pay for because these banks did not want vacant homes (no one around allowed for theft) and assets they would be required to carry in their books and would not be able to sell. These banks have told realtors that what is coming in the quantity of foreclosures will amaze them (14,000 to one realtor alone).
It does not need to be any major event but the idea that things are truly not getting better and actually getting worse will most likely be the catalyst. If there is any. The good thing as always is that we are not required to foreshadow the market...just trade what is given to us everyday and change with it if it changes.
I concur. Even though stocks
Posted by junkmaylbox on 8th of Jun 2009 at 11:39 pm
I concur. Even though stocks are said to be driven by earnings -- which are reported as 1/4 of what they were last year -- it is the masses that bring their money in. When folks need money -- and they will need it to survive -- they will liquidate their assets. Foreclosures, job losses, the drop of standard of living will take their toll. those are involuntary actions, and they will be taken despite the best assurences to the contrary. We haven't seen forced bankruptcies yet, which happened in 1930s; extreme risk aversion for investing, which normal mark market bottoms.
In short, I would ignore what Americans say and will see what they are up to in the not so distant future. And don't forget that foreigners who hold US dollars, don't keep them in the banks. When they decide to call it quits -- and they will after $US drops enough -- there will be nothing to prop up stock prices.
During the 1930s the only category of stocks that went up were mining stocks
http://www.kitcocasey.com/articles/2771/gold-stocks-in-a-depression/
They went up 4 or 5 times from their 1930 prices. If you understand everything about how depressions work, you should be able to explain how on earth that could have happened.
Chris Laird once said that one could buy a house for 10 ounces of gold then. I am waiting to see this happen again.