Blog Claim "Markets Flat Before Geithner's speech", Really?

[tobyguy]

Today's blog cliam "The markets were flat before Geithner's speech, and immediately went down afterwards, ending the day down 4.5-5%"

Truly amazing.... do you actually verify what you write? Or do you just regurgitate us the same bull the media feeds us?

Please get your facts right if you're going to make such claims.

What really happened (facts):
Geithner began talking at 11:11am Eastern and finished at 11:30am Eastern (for a total of 19 minutes).
The DIJA was down 207 points when he started talking at 11:11am Eastern (what you call "flat").
The DIJA went up and down about 50 points (range) during his remarks.
When he was done (11:30am Eastern), the DIA was down around 215 points (8 points delta).
Don't believe me (check it out: hxxp://www.google.com/finance?q=INDEXDJX:.DJI, ... SDAQ:.IXIC)

What is accruate is as follows;
The market was down considerably (207 points) before his speach.
The market was basically flat during his speach.
The market went down after his speach, but less than before his speach.

For a forum that criticizes the establishment, you sure take their reporting as accurate.

It took me all of 10 minutes to verify the above by doing basic internet searches.

One could argue that the markets fell harder before his speech than after!

PS. I could care less about Geithner or his speach (nor do I believe anything he'll do will make much of a difference - likely much worse).

I'm sure I'll receive many replies as to who cares!? Why would I mention such a minute error detail?

I mentioned it because I find it amuzing how people try to position that this piece of news or that piece of news causing this market to move or that market to move in this direction or that direction. Believing that the news drives the market is often wrong period. This is all but one example of how quick we are to blame something that is clearly incorrect - and we even resort to providing factually incorrect evidence to try and prove it - simply to prove their point.

Tobyguy

[John]

If you start counting from 11 am when (I believe) the contents of Geithner's speech
became known to the press, then my statement is correct.

Sincerely,

John

[tobyguy]

If you start counting from 11 am when (I believe) the contents of Geithner's speech
became known to the press, then my statement is correct.

Sincerely,

John

hxxp://www.google.com/finance?q=INDEXDJ ... SDAQ:.IXIC

Did you open the above? At 11am, it was already down 1.6% (DIJA). Is that what you call "flat".

BTW. Do you seriously believe that traders sat by their desks waiting for the release of that press release? Then reading it very quickly and reacting negatively? Is that how you think markets work? Seriously....

This isn't the first time I've heard such nonsense. And I guess we had that 200+ point rally the same day that announced almost 600k jobs lost (late last week)?

Tobyguy

[Higgenbotham]

Did you open the above? At 11am, it was already down 1.6% (DIJA). Is that what you call "flat".

BTW. Do you seriously believe that traders sat by their desks waiting for the release of that press release? Then reading it very quickly and reacting negatively? Is that how you think markets work? Seriously....

Dow Jones obtained excerpts of Geithner's speech before hand and released some of them at 10:08 a.m. Eastern. It's still on my news feed.

I don't trade anymore because I think the markets are too dangerous.

Every trader is different, but the way I handled key news events, and this was one, was to watch the market ahead of the news release to try to gauge how the market might react to the news. Sometimes I would go in with a position ahead of the release. Mostly I would enter a position shortly after the release if it looked like the market was taking a direction off of that event. Then I would read the news later. I know for a fact that many and probably most traders read all the news as it comes in or stay glued to CNBC. There is an advantage to CNBC as you can see the exact reaction to the release as that's where most traders hear it.

Typically, markets trade in narrow ranges before important news events and then release their pent up energy upon release of the news. This is typical ahead of Fed announcements.

[tobyguy]

Did you open the above? At 11am, it was already down 1.6% (DIJA). Is that what you call "flat".

BTW. Do you seriously believe that traders sat by their desks waiting for the release of that press release? Then reading it very quickly and reacting negatively? Is that how you think markets work? Seriously....

Dow Jones obtained excerpts of Geithner's speech before hand and released some of them at 10:08 a.m. Eastern. It's still on my news feed.

I don't trade anymore because I think the markets are too dangerous.

Every trader is different, but the way I handled key news events, and this was one, was to watch the market ahead of the news release to try to gauge how the market might react to the news. Sometimes I would go in with a position ahead of the release. Mostly I would enter a position shortly after the release if it looked like the market was taking a direction off of that event. Then I would read the news later. I know for a fact that many and probably most traders read all the news as it comes in or stay glued to CNBC. There is an advantage to CNBC as you can see the exact reaction to the release as that's where most traders hear it.

Typically, markets trade in narrow ranges before important news events and then release their pent up energy upon release of the news. This is typical ahead of Fed announcements.

So I guess the 600,000 job losses announced late last week was a positive breaking news story since the DIJA experienced a 200+ point rally?

Would you have bought stock on that news? Many people certainly did! (Ignoring breaking news, expected news, etc.).

Tobyguy

[MisterB]

I start with the premise that no one can ever “prove” why the stock market rose or fell. Also, I do believe that most days the stock market movement has a large random factor. Most explanations of why the market went up or down for any given day are BS. However, there are indeed true new events that effect the market.

IMO, Tuesday was a true news event and the market fell because the plan outline draft from was very disappointing particularly from the point of view of an equity holder in financials. (A true news event is when people do NOT know what the news announcement will be.) You do need to consider when a significant number of people had advance copies etc. as to timing.

I don’t see the jobs number release as much of a news event. Certainly, everyone was expecting a very poor number. The thinking of many speculators was the bad jobs number would prompt the government into more action hence it was bullish.

[Higgenbotham]

So I guess the 600,000 job losses announced late last week was a positive breaking news story since the DIJA experienced a 200+ point rally?

Would you have bought stock on that news? Many people certainly did! (Ignoring breaking news, expected news, etc.).

Tobyguy

I don't know what most participants were looking for on that one (and I don't know what they were looking for from Geithner). I'm not up on the details of trading at this point and don't want to be. In my opinion, this is not the time to be trading anything.

As far as how others may have approached it, large companies announce their layoffs, and large company layoff announcements in January were up a lot over December. Therefore, I think some participants were expecting medium and small company layoffs to he higher for January, and for the unemployment number to be higher than the 594,000 for December (like more than 600,000).

I'm not a great philosopher on news or what the reactions mean. All I really know is that traders watch news and they react to it. Like I said, a lot of times I don't even look at the news until later because I don't want it to bias my interpretation of what the market is actually doing, but I always made myself aware of the times of important releases.

[John]

> It took me all of 10 minutes to verify the above by doing basic
> internet searches.

Perhaps you should have spent an extra ten minutes to get your facts
straight.

> hxxp://www.google.com/finance?q=INDEXDJ ... SDAQ:.IXIC
> Did you open the above?

No, I couldn't open the above, because it's a broken link.

Apparently your own work is so sloppy and slipshod that you didn't
even bother to check that your own link worked.

This is really amazing, because you posted the same broken link
twice. You're perfectly willing to launch belittling and
disapproving criticism of other people for things that are "mistakes"
only in your imagination, but here you're such a slob that you
repeatedly post broken links.

> BTW. Do you seriously believe that traders sat by their desks
> waiting for the release of that press release? Then reading it
> very quickly and reacting negatively? Is that how you think
> markets work? Seriously....

> This isn't the first time I've heard such nonsense. And I guess we
> had that 200+ point rally the same day that announced almost 600k
> jobs lost (late last week)?

As MisterB points out, job-related statistics come out all the time
-- every week on Thursday morning, and the first Friday in every
month. The 600K figure was widely anticipated, and some people
considered it not as bad as feared.

But Geithner's speech was a one-time worldwide event. Every trading
desk in the world was probably listening to it. It's widely believed
that the stimulus package will make the difference between a
recession and total catastrophe -- partly because President Obama has
said so repeatedly -- and traders wanted to know the details so that
they could place their bets.

The fact that you compared Geithner's speech to an employment report
shows that you're totally unaware of all this. Not only do you seem
to be unable to post valid links, but you appear to be totally
oblivious to what's going on in the world. Would you be able to find
China on a map?

Don't you think that you ought to educate yourself a little bit
before launching into fantasy rants about other people?

> Truly amazing.... do you actually verify what you write? Or do you
> just regurgitate us the same bull the media feeds us?

Not only are you an obnoxious jerk, but you're totally full of crap.

Sincerely,

John

[tobyguy]

> It took me all of 10 minutes to verify the above by doing basic
> internet searches.

Perhaps you should have spent an extra ten minutes to get your facts
straight.

> hxxp://www.google.com/finance?q=INDEXDJ ... SDAQ:.IXIC
> Did you open the above?

No, I couldn't open the above, because it's a broken link.

Apparently your own work is so sloppy and slipshod that you didn't
even bother to check that your own link worked.

This is really amazing, because you posted the same broken link
twice. You're perfectly willing to launch belittling and
disapproving criticism of other people for things that are "mistakes"
only in your imagination, but here you're such a slob that you
repeatedly post broken links.

> BTW. Do you seriously believe that traders sat by their desks
> waiting for the release of that press release? Then reading it
> very quickly and reacting negatively? Is that how you think
> markets work? Seriously....

> This isn't the first time I've heard such nonsense. And I guess we
> had that 200+ point rally the same day that announced almost 600k
> jobs lost (late last week)?

As MisterB points out, job-related statistics come out all the time
-- every week on Thursday morning, and the first Friday in every
month. The 600K figure was widely anticipated, and some people
considered it not as bad as feared.

But Geithner's speech was a one-time worldwide event. Every trading
desk in the world was probably listening to it. It's widely believed
that the stimulus package will make the difference between a
recession and total catastrophe -- partly because President Obama has
said so repeatedly -- and traders wanted to know the details so that
they could place their bets.

The fact that you compared Geithner's speech to an employment report
shows that you're totally unaware of all this. Not only do you seem
to be unable to post valid links, but you appear to be totally
oblivious to what's going on in the world. Would you be able to find
China on a map?

Don't you think that you ought to educate yourself a little bit
before launching into fantasy rants about other people?

> Truly amazing.... do you actually verify what you write? Or do you
> just regurgitate us the same bull the media feeds us?

Not only are you an obnoxious jerk, but you're totally full of crap.

Sincerely,

John

Firstly, I copied and pasted the correct link. It's this web site/forum that didn't take it all for whatever reasons. It put in periods that I didn't paste.

Also, is that the best you can do? Accuse me of being sloppy because the web site didn't take my pasted links? Big man of you I must say. I guess I'm guilty of not confirming the link worked - how damb stupid of me!

Back on topic, your blog said that up until his speech the market was flat (not soon to be released speech).

That is a total load of crap period. It was NOT flat up until his speech - that was my point.

Then when you were clearly wrong, you went on to say, no, it wasn't his speech, but when he released what he was going to say in his speech. Even then you had it wrong, it was NOT at 11am, but almost an hour earlier. Even your chart above shows a spike up around 11am. So which is it? Was it his speech or his release of the text of his speech? Neither occured at 11am. Why the spike up around 11am? Did those traders change their minds about the text in his speech, that was released just after 10am? (Yeah, that's it).

Then you accuse me of saying my work was sloppy, it wasn't, your time periods are what is sloppy, not my points.

My point remains the same, during his speech is the only time things were flat. Prior to it, the market was down and went down further after him actually speaking.

If you want to believe that traders actually read his statement when it was released just after 10am eastern, and that's why the market started tanking - you go ahead and believe that.

In addition, regardless of whether or not you believe the market was down prior, during or after his speech, you need to learn some basics about correlation and causation. That is why I mentioned the huge jobs lost "news" where the market went up. If you failed to understand why I mentioned that, I help you out. "News" has almost nothing to do with markets ups or downs - that was the point!

Lastly, you seem to dish out a significant amount of criticism of others but can't take any.

It says a lot about a person who resorts to personal insults during a technical discussion.

Tobyguy

[Matt1989]

Ah, now it seems appropriate. Who cares?

Whole lot of nothin'