The Official Dow 7000 thread

[wimpy77]

at this point i think what needs to be done needs to be done. bernanke is right until the banks are fixed no amount of stimulus will work. how much more do you think they will end up asking for? another $700 billion.

I don't think you quite understand the plan.

The 700 billion is what the people of the USA get to rebuild the infrastructure and what not

The bankers are promised an amount more like $9 Trillion in cash and guantees for their toxic debts.

i wasn't talking about the stimulus. senators in the congress are already preparing for another bank bailout for atleast another 700 billion.

 

[wimpy77]

Here we go.... 30 points above 6999 in DOW futures because of the GDP and because of Citigroup.

Would that be the SAME CITIBANK which we were recently told was solvent?

NONE of them are solvent, folks.

some are and some aren't. cit in most economist eyes are probably the most insolvent of all the banks and most believe that the stress tests will prove that the ceo of bofa is an outright liar.

 

[Ravi]

I'm feeling oddly calm about this all of a sudden.

I don't even care if we fall another 20%. I am feeling pretty confident that this mess is solvable, that the end of the world is not here and that the economy, despite perhaps even being in a depression, we are not going to collapse. I think the banking system is beginning to repair itself.

What is making you feel confident?

 

[Toro]

I'm feeling oddly calm about this all of a sudden.

I don't even care if we fall another 20%. I am feeling pretty confident that this mess is solvable, that the end of the world is not here and that the economy, despite perhaps even being in a depression, we are not going to collapse. I think the banking system is beginning to repair itself.

What is making you feel confident?

Corporate bond issuance is strong.
Home prices are no longer over-valued, at least not materially so.
The government has developed a mechanism for stress testing and injecting capital into the banks.
There will be no material price deflation.
The banks are stuffed to the gills with reserves
The inter-bank market, i.e. LIBOR, has stabilized.

And most importantly, this.

http://www.usmessageboard.com/economy/70488-why-the-banking-system-will-not-collapse.html

Understand that the single most important thing is not the economy. It is the financial system. We know (more or less) how to fix the economy. The black hole is the financial system. If it is on the road to repair, which I believe it is, then we will effectively deal with the economy.

 

[Ravi]

I hope you are right, Toro. We've not felt a pinch at all, truth be told (well, except for those nasty sep-ira statements). In fact we finally replaced the boat we lost in Wilma...at a steal even for a used boat...and it has a bathroom.

 

[wimpy77]

I'm feeling oddly calm about this all of a sudden.

I don't even care if we fall another 20%. I am feeling pretty confident that this mess is solvable, that the end of the world is not here and that the economy, despite perhaps even being in a depression, we are not going to collapse. I think the banking system is beginning to repair itself.

What is making you feel confident?

Corporate bond issuance is strong.
Home prices are no longer over-valued, at least not materially so.
The government has developed a mechanism for stress testing and injecting capital into the banks.
There will be no material price deflation.
The banks are stuffed to the gills with reserves
The inter-bank market, i.e. LIBOR, has stabilized.

And most importantly, this.

http://www.usmessageboard.com/economy/70488-why-the-banking-system-will-not-collapse.html

Understand that the single most important thing is not the economy. It is the financial system. We know (more or less) how to fix the economy. The black hole is the financial system. If it is on the road to repair, which I believe it is, then we will effectively deal with the economy.

tell this to jim cramer. he was having a mini tantrum. he blames obama daily for the market dropping. i think geithner ultimately has a plan and when the stress tests are completed he will but it into action.

charles gasparino on cnbc actually disagreed with kudlow that he thought it was a could idea to increase their stake in citi because when the government takes the bad assests of of their books they will have capital leftover

 

[wimpy77]

any prediction for this week? dow below 7k and the s&p at 720?

 

[Toro]

Don't listen to Cramer.

That's another piece of advice I'd give anyone.

Not that he's always wrong but rather that is usually just reading the tape.

 

[DavidS]

Don't listen to Cramer.

That's another piece of advice I'd give anyone.

Not that he's always wrong but rather that is usually just reading the tape.

Come on! I'd always listen to Cramer! He can make or break stocks like there's no tomorrow.

He can say "buy" on a 15 cent stock and tomorrow it'll be over $2. Then the next day he can say sell and he can make a huge profit. He could run his own ponzi scheme!

 

[editec]

Don't listen to Cramer.

That's another piece of advice I'd give anyone.

Not that he's always wrong but rather that is usually just reading the tape.

Come on! I'd always listen to Cramer! He can make or break stocks like there's no tomorrow.

He can say "buy" on a 15 cent stock and tomorrow it'll be over $2. Then the next day he can say sell and he can make a huge profit. He could run his own ponzi scheme!

He's very entertaining.

 

[Toro]

Don't listen to Cramer.

That's another piece of advice I'd give anyone.

Not that he's always wrong but rather that is usually just reading the tape.

Come on! I'd always listen to Cramer! He can make or break stocks like there's no tomorrow.

He can say "buy" on a 15 cent stock and tomorrow it'll be over $2. Then the next day he can say sell and he can make a huge profit. He could run his own ponzi scheme!

He can spike a stock, I know that. For a while, the big houses like Smith Barney on their morning calls were highlighting what Cramer said on his show the previous evening. However, I have a subscription to his site, and he basically reads the tape. Plus, as has been demonstrated countless times, his recommendations on his show underperform.

 

[wimpy77]

craner for me is about 50/50. but i can't understand for the life of me why he blames obama for the markets wows. like when he announced his budget and when biotechs and health stocks dove it was obamas fault. cramer said that obama is the most anti market president since carter.

 

[DavidS]

Dow futures are down 68. If the market opens like this tomorrow, we'll have an intraday low BELOW 7000. Who would have ever thought??

 

[wimpy77]

the government just announced a $30 billion deal with AIG no doubt probably has the market spooked.

 

[wimpy77]

Dow futures are down 68. If the market opens like this tomorrow, we'll have an intraday low BELOW 7000. Who would have ever thought??

i think we might see a 20% more drop in the dow below 7500 so that's what 1300 points.

 

[Toro]

Maybe we'll go to 300.

Just remember in 2000 when the Nasdaq crossed 5000, and everyone was telling us that the frenzy was real and you should buy stocks, and the world looked rosy forever. That was a great time to sell.

Today, the opposite is happening. It is a great time to buy. America is on sale.

 

[wimpy77]

so you're saying 6700 tomorrow?

 

[DavidS]

I think it's time to REALLY get into the market when the dow hits 6500 and the S&P hit 690.

 

[wimpy77]

that might happen this week.

 

[DavidS]

that might happen this week.

This week? It might happen today. Futures are down 141. We won't even see 6900 at the open!