I know this was expect but is there any relief in sight? This is getting pretty ugly to watch and I wonder where will it bottom out 9000K or even lower?
Two scenarios: 1) Massive fed rate cut tomorrow, like 75 or even 100 basis points, and we see the rally that started late this afternoon continue at least until the Dow reaches 10,800. 2) Yet ANOTHER shoe drops, and Dow plunges to 8,800. We're only about 1,200 points away from that support, why not? My take: the market is oversold and scenario #1 is more likely.
What is the point of a rate cut? Pump the markets a little more so someone can dump. The bailout the tax cuts etc. are not going to significantly change the fact that housing prices are going down. Its time to let the market establish a bottom so we know where to get on. No point of delaying the inevitable.
10K is where we have needed to be for quite a long time. With the tech boom, the market has not had a chance to cool itself off since then. We continue to try and fix the problem with debt. We feel like if it falls under 10k, then we are hitting a depression. Recessions WILL happen and NEED to happen. The problem lies with anyone with significant amount of debt, not the banks and not the government. "Keeping up with the Jones" is the single most problem in our country. We take our salary and cut it into 110%. New cars, new houses, new toys, vacations, ect ... we must have it all. W/out it, we are considered a failure. The problem is America can not cut back w/out creating a recession as we spend too much as it is now. Our government needs to quit trying to prevent this recession and just let it happen.
That's a lot of pissed off old people... Retirement accounts have lost $2 trillion http://news.yahoo.com/s/ap/20081007/ap_on_bi_ge/meltdown_retirement
You know, if we had a competent President in office, or a competent one running, one of them would take this time to tell individuals to save, pay down debt, cancel credit cards, and get their own financial house in order. Even suggest that they learn a new job as we painfully transition into a producing economy. Appeal to their patriotism to get back to personal financial sanity that disappeared during the tech bubble, and got worse during the housing bubble. Then again, maybe it's not incompetence. Maybe they and their supporters are too invested in the bubble, and they'll keep pumping our money into it, trying to keep it inflated.
The ban on short selling is a complete joke. I have made a substantial amount of money from ETFs. There is no end this beating the financials and now the Dow is taking. This cleansing process is a necessity to our bloated economy to bring it back on track of normal healthy growth. Moving forward, I am shocked that no one is willing to address the real issue here, neither the government, the media or anyone is putting blame on the average American for living above their income. This is the point at which Americans have to make painful sacrifices. First priority should be to balance your budget and try to reduce personal debt over the next several months. I know this will be hard but we need to make fundamental changes in the way we spend our money and reduce our reliance on credit lines to live comfortable lifestyles. This is the only way to avoid a depression and must be initiated at the most basic level, the average household.
because just because the american spending is an issue, it doesn't justify the creditors handing out credit with no standards. they're the ones who get paid to make credit decisions.
That may be very true. But like a crack dealer who might sell too much crack to a good client only to have the client OD... it's the crack w****'s fault in the end that they died imho. Of course curbing one can help curb the other... but personal responsibility too.
crazy... the stock market is at the same point it was 10 years ago really sucks for people who were planning on the last 10 years of compound investment returns to get to retirement.
This is just plain old panic selling now. It's like Crazy somebody's stereo store, Prices are so low, they're practically insane! Earth to DJIA: people are still going to buy SOME things unless we go to Mad Max beyond Thunderdome barter economy.
Amazing that this thread was started less than 48 hours ago, and we could hit 9000 within 24 hours pretty realistically. And the DOW is the best performing of all these indexes.
I agree, but i think there is real devaluing of a lot of companies, especially in consumer goods. the one thing a reccession is supposed to cure is inflation.
Bingo- nail on the head. Cheap credit (which is the only cause of inflation) resulting in disproportionate debt heats up the economy giving rise to the last 20 yrs of market bliss- that is a bubble economy (debt fueled)... Once the credit bubbles all pop and people are under strain to borrow more and debt's default at a rate that panics big banks and banks collapse because of the risk of loans made; then the credit must constrict- tighten up, banks must look for safety and if the credit bubbles are large enough you end up with a huge constriction of credit and that is exactly what a depression is. Now whether we are going to have a huge constriction or there is some way to heat borrowing back up remains to be seen. What all the Central Banks are doing is trying to heat up some more credit/debt- borrowing so that they can get one more bubble out of this thing before is all blows up. Hopefully they can. If not, I don't think 9000 is a reasonable bottom- look much lower. What compounds this is if the stocks continue the drop panic will speed it up. The longer the very wealthy people are worried about debt and defaults the more they are looking for safer ground, which feeds the speed of correction from a debt based economy to an asset production based economy. If we have a depression, things will be pretty much cash basis for a short time and then the long haul to dig out and get back all the overleveraged loans to a reasonable total. The thing that is causing all this is the amount of total debt outstanding is way too leveraged and too large and starting to scare investors because the borrowers are starting to show signs of weakness through loan default, late payments and unwillingness or inability to borrow any more. Thus everyone starts looking for safety and the banks start collapsing. There is only two ways out- Somehow get both- people borrowing again and banks lending again- in large amounts- Thats why Central Banks are throwing more money at the problem- trying to heat borrowing back up (another bubble) Or let the worthless debt, poor and risky borrowers fall and drag down alot of good people with them. Obviously, no one in the public wants to state the obvious and no one in an election year is going to talk about the fundemental issue- Govt. debt/spending and consumer debt/spending. Both candidates are proposing spending/ borrowing alot more money and they certainly don't want to point a finger at the consumer. So I imagine they will blah blah blah about regulation and greedy banks.
OK so the coordinated rate cut across the globe happened so what do you think is a reasonable bottom for this thing now? I still think it will dip below 8000 however there will be a rally in the short term which would be a good time to sell and cover losses if you already haven't done so. Please don't make the foolish mistake of buying these short rallies cause the long term projections are still dire. This is similar to 2002-2003 where you will see bumps but no real stability. Earnings will be coming up pretty soon and it will be hard to find anything of value from it. Stick with essential long positions on stuff you know has solid fundamentals for 12-18 months down the road and do not invest in these short spikes of the market. We still have to reach a bottom before you can restore confidence in such a volatile market.
