Pay attention to the Market Rally folks BECAUSE it will not hold...

Blackhatjack

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Tue Mar-18-08 02:40 PM
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Pay attention to the Market Rally folks BECAUSE it will not hold...

What was fundamentally wrong with financials before the 3/4 pt short term interest rate cut by the Fed Today is still there, and this will not fix it.

To borrow a phrase, this may only be 'irrational exuberance' by those who think they have found a path out of the wilderness, only to find that all paths remain deadends.

Until there is 'transparency' among lenders, there is going to be a lid on extending credit and selling mortgage backed securities.

And until all the losses which remain 'off the books' are revealed, there is going to be no way to establish financials' values.

THis rollercoaster ride is far from over...

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mac2

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Tue Mar-18-08 02:42 PM
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1. Is there anything the candidates would do about it?

It was fraud to give bad loans for their own profit. No one goes to jail but we the tax payers bail them out.

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On the Road

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Tue Mar-18-08 02:43 PM
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2. Could be, But This One Feels Like a Medium-Term Bottom

Edited on Tue Mar-18-08 02:44 PM by ribofunk

None of the previous lows did, including the last. The VIX didn't show complete capitulation, but it was getting close.

Personally, I think the market will rally unless or until there's another Bear Stearns.

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napoleon_in_rags

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Tue Mar-18-08 02:44 PM
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3. I think you're right, a long term correction is at hand.

We are changing the way we do business on a lot of fronts, and when we finally wake up, the key issues will be fixing transportation/energy issues as well is transparency - not just in markets, but in everything. I think we will wake up to the fact that popular access to quality information is one of the quickest ways to make the market boom in the information age.

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Blackhatjack

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Tue Mar-18-08 02:49 PM
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4. Who is going to buy a financial which may have Bear Stearns' type problems concealed?

There will always be speculators and those covering short positions, but in the end the support is not going to remain there until we know exactly where the financials stand.

This is especially true given the Bear Stearns object lesson we just observed.

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LeftHander

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Tue Mar-18-08 02:49 PM
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5. Actually the rally is the cycle of reinvesting short profits...

As investors gain on shorted stocks they turn around and reinvest in stocks and that probably drives prices up. Then as regular schmucks buy those they profit take again the price drop and the shorting begins anew...you can see this in the 5 month chart. A steady roller coaster with a downward trend.

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nels25

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Tue Mar-18-08 03:22 PM
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6. It did not hold in 1929

I was reading today about the market crash in 1929, and I was struck by some similarities.

Then it was run away stock speculation as the bubble, now it is housing.

Then as now some financial institutions were just looking for a buck and not carrying about the future, after all stocks will alway go up, sound familiar.

I could go on but you get a bit of the picture, look it up you will be surprised.

God help this Nation!:scared:

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Ichingcarpenter

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Tue Mar-18-08 03:32 PM
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7. They have cut the rate 5.25% since September they have 2.25% left to play with

It is just a temporary fix.

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Blackhatjack

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Wed Mar-19-08 09:28 PM
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8. 3/4 pt Rate Cut Yesterday and Today 3/4 of Yesterday's Gains Go Poof!!

It had to happen -- and now the truth is known. The FED is trying to rescue Wall Street 'Big Boys' at the expense of taxpaying consumers, and the plan is hopelessly flawed.

I am afraid we are in for some really 'bad news' in the weeks to come, if the Govt does not take a Savings and Loan Bailout Solution to the mounting housing crisis.

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girl gone mad

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Wed Mar-19-08 09:41 PM
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9. In another thread..

I mentioned the rate on short term treasury bonds being less than .5% right now. That's a pretty glaring indication that stocks are heading lower. I think this is the time to be liquid (cash is king) because we are heading into a deflationary spiral. That's just my opinion, I'm not a financial adviser.

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