Official Dow 10,000 thread

[Paulie]

Call me a pessimist but I think we will see 6000 before we see 10000, because of what xsited said pretty much, people are going to make some profits and bail when the government cheese ends and then we will also see some kick ass inflation that will exceed any gains for the next several years.

The inflation would most likely spike equities and commodities, as people are going to want somewhere to put all the extra cash. What we MAY be seeing is what's referred to as a "reflation trade". The government is throwing trillions of dollars at a problem, which is going to cause mass increases in the money supply. The monetary base is at unprecedented levels as we speak, so when that money hits the streets it's going to be looking for a home.

That home is most likely going to consist of another bubble, including inflated equities prices. The stock market stands to gain a lot once again, but I certainly wouldn't ignore precious metals.

 

[wimpy77]

dang it didn't take long for the market to go up after the fed announcement did it?

 

[DavidS]

dang it didn't take long for the market to go up after the fed announcement did it?

I'm worried about this decision. Perhaps Toro could chime in here, but the dollar just plummeted when the Treasuries skyrocketed due to the Fed's decision. How much longer can we keep doing this when the dollar is the overall victim?

 

[wimpy77]

most people ive heard think its a good decision what the fed did, but i think it can only be temporary.

 

[DavidS]

most people ive heard think its a good decision what the fed did, but i think it can only be temporary.

We're still in triage after the plane crash, helping stablize the market. We need to get to a point where the market and the economy is stable.

But we did have a near 200 point bounce today. Nice.

 

[wimpy77]

paulie i understand your point about inflation just so you know.

 

[wimpy77]

im thinking tomorrow we might get a hiccup in the rally. i think all this AIG talk is gonna bother some investors. we shall see.

 

[NOBama]

And are Glen Beck or this other joker economists or stock traders? No. Stock traders are the ones that are saying that the market is really cheap right now and oversold.

Psst... Their the same people that have been saying that since Q3-08.

It doesn't take a rocket scientist to see that everything listed on the exchange is cheap right now. The real question is: Cheap in comparison to what; the inflated value or the actual value?

This is just an intuitive suspicion but, soon after everybody jumps back in don't be surprised if the whole mark to market issue comes back into play.

BTW, I doubt we see 10k this summer. (EDIT: but I hope I'm wrong).

 

[wimpy77]

And are Glen Beck or this other joker economists or stock traders? No. Stock traders are the ones that are saying that the market is really cheap right now and oversold.

Psst... Their the same people that have been saying that since Q3-08.

It doesn't take a rocket scientist to see that everything listed on the exchange is cheap right now. The real question is: Cheap in comparison to what; the inflated value or the actual value?

This is just an intuitive suspicion but, soon after everybody jumps back in don't be surprised if the whole mark to market issue comes back into play.

BTW, I doubt we see 10k this summer. (EDIT: but I hope I'm wrong).

im skeptical about dow 10,000 this summer as well. this aig situation may send things back into a tail spin.

 

[Terral]

Hi NOBama:

[FONT=&quot]This is just an intuitive suspicion but, soon after everybody jumps back in don't be surprised if the whole mark to market issue comes back into play. [/FONT]

BTW, I doubt we see 10k this summer. (EDIT: but I hope I'm wrong).

Mark-to-Market Valuation (Wiki) is the ONLY 'fair value' market accounting method that connects ‘true asset value’ to the ‘real’ market. Every other accounting method is a ‘forecast’ or a ‘prediction’ based upon ‘true asset value’ plus or minus any anticipated rise or fall in the ‘real price’ based upon predicted market conditions. Mark-to-Market accounting gives you ‘the price’ that buyers in any given market ‘are’ willing to pay today for your asset/property, but the crooked banks want to raise that amount to a ‘fantasy value’ they pick out of thin air; even though housing prices are COLLAPSING. Transitioning ‘away’ from Mark-to-Market Valuation of real property will only reduce ‘transparency’ and market ‘credibility’ and drive potential buyers out of the market and send home values down even more.

Any discussion about eliminating Mark-to-Market Valuation of real property assets (house, mortgage, bond prices) creates an open invitation for those holding ‘bad assets’ to generate ‘two’ sets of books, so they can trick (swindle) some foolish buyer into paying too much for their troubled assets that will only continue to lose value at the end of every month and every quarter. Think about it: Do you want to pay a ‘fair market price’ for what an asset is worth ‘today’ in the real world, OR do you want to pay an ‘inflated price’ that some banker wants you to believe that asset might be worth at some point down the road based upon ‘his’ rosy speculations and forecasts? :0)

Mark-To-Market Valuation of real property assets is the ‘only’ game in town and anybody trying to say otherwise wants you as their DUPE. My prediction for the Dow Jones by the end of the year is between 5000 and 6000 if the liars keep talking the markets up . . .

GL,

Terral

 

[editec]

Nobam asks the $64 trillion dollar question:

It doesn't take a rocket scientist to see that everything listed on the exchange is cheap right now. The real question is: Cheap in comparison to what; the inflated value or the actual value?

Prices are relative to everything else, folks.

I realize that there's still plenty of wealthy people waiting on the sidelines ready for the market to show signs of true stability, but honestly...

how healthy can the market be if the people in the USA are unemployed, and growing increasingly unemployable, too, because they cannot compete with nations where the average worker works for 1/10th what they MUST have to thrive in this nation?

WE have lived through a GILDED AGE. The top 1% have a combined income greater than the bottom 90% of this nation's population.

That is unsustainable, I think.

This economic meltdown, regardless of the specific way it came undone, is rooted in the excesses and income inequity that this nation not only allowed, but encouraged to happen.

 

[wimpy77]

edit you simply don't understand how the market works. when i used to invest heavily in the markets i looked in terms of long. im pulled my money out in november i was diversified and didn't take that big of a hit. i am still relatively young and have about 20+ years before i retire. im still long in the market and the economy. i think at this point the economy is gonna fix its self. because with the tax legislations being drafted no private investor is gonna help the government now with toxic assets.

 

[wimpy77]

i didn't feel llike making a new thread. i know its not important but the futures are right now at almost 3in the morning est. it will be interesting to see how the market reacts to geithners toxic asset plan.

 

[Terral]

Hi wimpy:

Hopefully this guy really has me on ignore, because his two-dimensional empty-headed rhetoric cuckoo insults our collective intelligence . . .

edit you simply don't understand how the market works.

This is no normal market, which you should realize by the fact that we are at 50 percent of even 2008 values (chart) and there is still plenty of downside and the bottom fishing continues. Rather than the Gov’t supporting ‘certainty,’ by making the right decisions, we have seen a series of backwards and foolish decisions that create even more uncertainty for potential investors. Anybody thinking that we are looking at a normal market is fooling himself.

when i used to invest heavily in the markets i looked in terms of long.

Who cares? Wimpy bumps these threads all day long without one credible source to back up his nonsense. Nobody can even think about investing for the long term with no idea about where the BOTTOM in the housing and stock market might be located. If the Dow Jones goes down to 5000 by the end of the year (which it will), then everyone putting their money into the market today will get murdered on the way down. The smart people (like Gerald Celente) are forecasting DOOM for the stock markets in case you are unaware. Show us one trend forecaster predicting a 10,000 point Dow Jones for this year and perhaps wimpy will have more than a wimpy case. :0)

im pulled my money out in november i was diversified and didn't take that big of a hit.

Lordy . . . Try to prove that the USA is looking at a normal trading pattern within highs and lows in any trading corridor, before you start talking diversification and hedging against potential losses. What method for determining the current housing and stock market bottoms are you using to support ANY trading strategy amid more Gov’t interloping than anybody on earth can possibly forecast? The out-of-control Obama Administration is putting fingers in the leaky dam that is eventually going to break and everyone with money in the market will be a big fat loser, which is the reason that so many smart people are staying liquid through the housing crisis (story). Think about it: If prices continue to slide (and the will), then you can buy the same property cheaper at an opportune time down the road. Let some other sucker own the property until the deflationary spiral is over . . .

i am still relatively young and have about 20+ years before i retire. im still long in the market and the economy.

In other words, you are ignoring the warnings from people like Gerald Celente (predicts collapse of 2009), because he is just a conspiracy theory nut! Right? :0)

i think at this point the economy is gonna fix its self. because with the tax legislations being drafted no private investor is gonna help the government now with toxic assets.

So, wimpy thinks this devastated U.S. Economy, now in the death grips of a deflationary spiral (story), is going to suddenly fix itself! Wonderful. And you also think that proposed tax legislation (heh) has been the right answer all along. Guess what hotshot? No housing bottom (links) means that ‘bad paper’ toxic asset number on all the bank balance sheets is only going HIGHER and there is not enough money on earth to fix this problem in view of rising unemployment and falling house prices. Instead, the number of households going underwater will ‘increase’ (Reuters.com) and fewer people will be in a position to secure a loan to make an offer on your depreciating piece of real property. Obama is pushing even more spending, when the tax base is eroding away right before our eyes; which means none of his forecasts have any basis in market reality.

Here is a nice place to begin looking at Lew Rockwell’s version of “The establishment is going down” (here) if anybody wants to take Dow Jones investment advice from somebody other than wimpy. :0)

GL,

Terral

 

[DavidS]

Please go away with your conspiracy theories you fucking moron.

In other news, dow futures are skyrocketing on news that our government IS actually competent.

Citigroup is up 25% in pre-market trading.

 

[editec]

edit you simply don't understand how the market works.

Okay, no argument from me on that point.

when i used to invest heavily in the markets i looked in terms of long. im pulled my money out in november i was diversified and didn't take that big of a hit. i am still relatively young and have about 20+ years before i retire. im still long in the market and the economy.

Good for you. But how does your situation make the market get healthier, exactly?

i think at this point the economy is gonna fix its self. because with the tax legislations being drafted no private investor is gonna help the government now with toxic assets.

Well I read what you wrote above, but I still don't understand it.

How does the fact that the government is going to own all those toxic debts, and no investor igoing to help the government with those toxic debts, make the market thrive, exactly?

The market will trhive because the government is stuck with a load of toxic debt?

Sorry don't get the connection.

 

[editec]

Please go away with your conspiracy theories you fucking moron.[

Regards terral's last post?

Absolutely nothing even remotely conspiractorial about that post.

As long as the real estate market is unstable, and people whose majority life's saving are in real estate (and that would be far more people than stock market investors, I suspect) people are going to continue to hold back on spending.

And certainly, as long as we're having increasing unemployment and underemployment, people are going to hold back on spending, too.

Now how the market thrives under those circumstances I cannot imagine.

Until the banks start lending, and the people start spending, again, I cannot see why the market would recover much if at all.

And if the price of real estate is going to reach pricing associated with incomes as it once was, then the median price of a home in the USA still have about $100,000 to drop, yet.

And THAT would put most mortgages under water, and make most homeowners feel VERY poor, indeed.

Is the stock market REALLY so disconnected from the financial state of the average American people that it can thrive while they all go broke?

 

[DavidS]

Guess what hotshot? No housing bottom (links) means that ‘bad paper’ toxic asset number on all the bank balance sheets is only going HIGHER and there is not enough money on earth to fix this problem in view of rising unemployment and falling house prices.

No housing bottom, eh?

US Existing Home Sales Up 5.1% in February - Real Estate * US * News * Story - CNBC.com

Dow is up close to 300.

Terral fail.

 

[editec]

Guess what hotshot? No housing bottom (links) means that ‘bad paper’ toxic asset number on all the bank balance sheets is only going HIGHER and there is not enough money on earth to fix this problem in view of rising unemployment and falling house prices.

No housing bottom, eh?

US Existing Home Sales Up 5.1% in February - Real Estate * US * News * Story - CNBC.com

Dow is up close to 300.

Terral fail.

This is good news for real estate?

The inventory of existing homes for sale rose 5.2 percent to 3.80 million from the 3.61 million overstock reported in January. The median national home price declined 15.5 percent from a year ago to $165,400. That was the second biggest decline on record.

An incr4ease in homes for sale and a $45000 decrease in median home prices in one year is good news?

If the market thinks these are good numbers, I will never understand the market, that's for damned sure.

 

[DavidS]

Guess what hotshot? No housing bottom (links) means that ‘bad paper’ toxic asset number on all the bank balance sheets is only going HIGHER and there is not enough money on earth to fix this problem in view of rising unemployment and falling house prices.

No housing bottom, eh?

US Existing Home Sales Up 5.1% in February - Real Estate * US * News * Story - CNBC.com

Dow is up close to 300.

Terral fail.

This is good news for real estate?

The inventory of existing homes for sale rose 5.2 percent to 3.80 million from the 3.61 million overstock reported in January. The median national home price declined 15.5 percent from a year ago to $165,400. That was the second biggest decline on record.

An incr4ease in homes for sale and a $45000 decrease in median home prices in one year is good news?

If the market thinks these are good numbers, I will never understand the market, that's for damned sure.

Increase in sales decreases inventory - we hope. This leads to smaller supply, which will inevitably trickle down into the market and turn prices around. Prices have to decrease over time. They were too expensive.