Financial topics

[John]

Yeah I chuckled at those statements, notice they only seem to say stuff like that on days that the market is going up, it is like they all live in a 24 hour bubble and can only think about what is happening right then.

The phrase that I like to use is that these guys "believe that history
always begins this morning."

John

[umoguy]

I love watching the folks on CNBC try to correlate today's news with what the market is doing. It never works, it is just another form of magical thinking. Just because two things happen at the same time, it does not mean there is any type of causal relationship.

[MarshAviator]

I just saw a topic from Yahoo news:
__________________________________________________________________

Stocks rise after 2 days of heavy selling
Friday November 7, 6:07 pm ET
By Sara Lepro and Tim Paradis, AP Business Writer
Stocks end higher on bargain hunting; market advances after 2 days of heavy selling

NEW YORK (AP) -- Buyers returned to Wall Street Friday after two days of heavy losses, mindful of the economy's growing problems but attracted by stocks' lower prices. Analysts said the advance, which also came amid relief that a bad report on unemployment wasn't worse and followed dour third-quarter reports from Ford and General Motors, was to be expected as Wall Street experiences a rocky recovery from October's devastating selling.

Have to admit I am dumbfounded.
What on earth do these people use for criterion of cheap ?
It almost appears that some form of institutional buying is going on to insure the year end bonus.
If a comet was forecast to hit earth and destroy a major continent, the dow (dax,FTSE) would rise 250 points.
Can't understand it at all.
John do you have an insight into this apparent madness ?

Bleak retail results, terrible p/e ratios, poor employment numbers (worst than expected as well), you would expect no better than mixed results.
This system is rigged.
Guess by 1 Jan 2009 "reality" will be different.
Does anybody understand this foolishness ?

[mannfm11]

There isn't a lot of volume out there. I have seen very few up days where they got it up and kept it there. They almost always need to jam the market the last 30 minutes or so. One of the CNBC crowd said a week or so ago that if you took out the 10 worst days, the market would be up or even for the year. If you took out the 10 best jam jobs, it would be under zero. Markets generally bottom when there is blood in the streets. I don't believe anyone alive has seen a market go down for a year straight like this one. They keep talking PE, but you take the excess out of XOM and CVX the PE's jumps a few notches. That is going to happen next. Plus, I think the telecoms are going to start taking hits.

[John]

> Have to admit I am dumbfounded. What on earth do these people use
> for criterion of cheap ? It almost appears that some form of
> institutional buying is going on to insure the year end bonus. If
> a comet was forecast to hit earth and destroy a major continent,
> the dow (dax,FTSE) would rise 250 points. Can't understand it at
> all. John do you have an insight into this apparent madness ?

Hey what's your problem, buddy? I don't know what your problem is.
Don't you know that the world changed on Wednesday? Investors know
it. Why don't you?

And lo, President Obama will rise, and gaze out over the land. And
his gaze will see problems and troubles. And he will say, "I see
great trouble in the land. I will change it, with change you can
believe in."

And lo, he'll raise his hand, and stretch his arm forward, and wave
it back and forth, so that it encompasses the entire land.

And lo, He will say, "Change! I command you to change!"

And the land will change. Idled machines will run again. Foreclosed
homes will once again ring with the laughter of children. Deserted
shopping centers will once again have their drugstores and pizza
parlors open again, bustling with customers. Jobs will be restored,
everyone's income will be above average, and people throughout the
land will be joyous and happy.

And lo, President Obama will gaze out over the land and see how much
has changed, and he will say, "This change is good."

Next, President Obama will gaze out over the world, and he will see
problems and troubles. And he will say, "I see great trouble in the
world. I will change it, with change you can believe in."

And lo, he'll raise his hand, and stretch his arm forward, and wave
it back and forth, so that it encompasses the entire world.

And lo, He will say, "Change! I command you to change!"

And the world will change. Hamas will sit down with Fatah, and
together they will sign the Roadmap to Peace agreement with Israel.
The Janjaweed militias in Darfur will lay down their arms, and will
apologize and offer peace to the farmers whose relatives they've
raped, beheaded and slaughtered. Iran will discontinue its nuclear
weapons program, and Mahmoud Ahmadinejad will beg forgiveness for
saying that Israel should be wiped off the face of the earth. China
will say, "What the f--k, let's give Tibet and Taiwan their
independence, and quit all this hullaballou." And Vladimir Putin
will quit politics and start preparing to participate in the 2012
Olympics.

Your problem, buddy, is that you're too gloomy and negative. If
there's anything I can't stand, it's gloomy, negative people. If you
weren't so gloomy and negative, you'd understand what's going on.

Sincerely,

John

[MarshAviator]

Your problem, buddy, is that you're too gloomy and negative. If
there's anything I can't stand, it's gloomy, negative people. If you
weren't so gloomy and negative, you'd understand what's going on.

Well I wasn't that gloomy until regularly reading your site.
Then again I wasn't that prepared either, so credit to you.
Wonder if President Obama can take away my sins ?

[John]

> Well I wasn't that gloomy until regularly reading your site. Then
> again I wasn't that prepared either, so credit to you. Wonder if
> President Obama can take away my sins ?

Hopefully he can take away all our sins.

My last posting was a joke, of course, but the incredible thing is
that most of it really IS serious. I doubt that Obama will be able
to fulfill even a single promise that he's made (except perhaps the
promise to buy his daughter a dog), but people around the world are
expecting the whole world to change overnight.

And I'm pretty sure that's a component of what happened Friday. The
news Friday was unbelievably bad, and yet the market went up 3%.

It's because in the investor fantasyland, the news is so bad that it
has to stop, and because Obama will make it stop.

There's also the idea suggested by mannfm11 -- that brokers are
making huge buy/sell orders simply to make commissions, with no regard
to whether the the orders themselves make sense. This would be
consistent with the massive fraud that got us into the credit bubble
in the first place.

As cynical as that is, I believe that's the answer to your question.

Sincerely,

John

[goblin]

Dear Mr. Xenakis ! In your Saturday weblog entry about deflation causes and interpretation of such by mainstream economists, you stated that consumption continues regardless of economic situation. But, what happens with consumption level in case of growing unemployment ? Or, lets
imagine , that demand exists , but , because of broken business structure , production or distribution of certain product stops or not sufficient, could be food items , fuel or medicaments. Will this call for government intervention and bringing some kind of military- socialist order, where inflation and deflation have no place ?

[John]

I've moved several postings on President Obama into a new topic in
the Politics forum:

President Barack Obama
http://generationaldynamics.com/forum/v ... p?f=9&t=61

Also, I moved the posting on the Imam to:

Geopolitical topics
http://generationaldynamics.com/forum/v ... p=925#p925

Sincerely,

John

[John]

> Dear Mr. Xenakis ! In your Saturday weblog entry about deflation
> causes and interpretation of such by mainstream economists, you
> stated that consumption continues regardless of economic
> situation. But, what happens with consumption level in case of
> growing unemployment ? Or, lets imagine , that demand exists , but
> , because of broken business structure , production or
> distribution of certain product stops or not sufficient, could be
> food items , fuel or medicaments. Will this call for government
> intervention and bringing some kind of military- socialist order,
> where inflation and deflation have no place ?

You're absolutely right that consumption decreases, and it was not my
intention to imply that it didn't. What I was trying to say was that
it's not deflation that causes consumption decreases. I've added
some text to make it clearer.

Thanks for the correction.

Sincerely,

John